By Ray Birch
BROOKFIELD, Wis.—If a credit union really wants to capture more Millennial members, it must change how it handles its financial education offerings—but not what the CU is talking about—instead, how it is delivering the message, asserts Fiserv.
Jamie Dominguez, director of product strategy, Bank Solutions at Fiserv, emphasized research shows young adults now want financial advice and education delivered to them via curriculum that relates to real life events, as opposed to talking about the nuts and bolts of a checking account or a loan. Moreover, they want messages delivered in bite-size chunks through mediums they use every day.
“Young adults want to receive their financial education through stories they can relate to,” said Dominguez. “Credit unions can talk about the same things they have in the past, the same products, the same essential financial advice, they just have to do it in a different way that will capture young adults’ attention.”
Avoid ‘Boring’
That means no “boring” PowerPoint presentations.
“That puts kids to sleep,” he said. “Kids today would rather watch a YouTube video or visit Instagram than have the bank or credit union CEO stop in the classroom and talk about checking, savings and loans.”
Dominguez described how a traditional CU financial education conversation might go with young adults as well as what needs to change. He said the long-time approach of talking about how to open an account and then how it works is not the best approach. Instead, Dominquez said the more effective messaging is to be more relatable.
Where to Start
“For young adults to understand it, talk about the life event—you want to buy a house, you got a job, you’re thinking about getting a car, how do you put your kids through school,” he said. “Talk about the life event component and then address how the products and services can help.
“For example, talk to kids about how when they get a new job are they going to manage their money, pay their bills, get access to their funds,” continued Dominguez.
He also stressed education should be delivered in smaller chunks and be available on demand. That could mean a two-minute YouTube video.
Dominguez asserted that some banks and credit unions are making this educational shift today, but many are not. He said both banks and credit unions seem to be at about the same point in the evolution of their financial education programs.
What Dominquez is most concerned about is banks and CUs not moving fast enough and losing consumers to fintechs that are well ahead of the game in reaching young adults through financial education programs that are more effective and relevant in their communications.
Jamie Dominguez
What Fintechs are Doing
“Fintechs are reaching out to young adults to educate them on financial services and their own products in ways that appeal to youth,” he said.
“You have fintechs out there that are speaking to young adults in their language and over their mediums. The competition is taking financial education in a new direction. Credit unions need to pay attention to what’s happening because there are external forces, forces outside the traditional financial services industry, that are taking away members through financial education.”
Dominguez noted Fiserv itself has had to evolve, as well, and recreate products and services that can assist credit unions in reaching their younger members through financial education.
Dominguez’s advice follow’s Fiserv research indicating just 38% of consumers are satisfied with their overall financial health, trailing not just physical health and social life (both at 44%), but also emotional health (56%).
How to Best Communicate
That finding, said Dominguez, underscores the significant financial education needs of Americans.
“Pairing that understanding of life events with a sense of how satisfied individual generations are with their financial health helps you learn how best to communicate with consumers,” said Dominguez. “For instance, our survey found 70% of Millennials expressed low satisfaction with their financial health. Clearly, Millennials can be an area of focus for your financial health efforts. But it starts with educating yourself about the best way to speak to younger consumers. Once you have that clear understanding, cascade it throughout your financial institution so everyone, from the teller line to IT, has that knowledge.”