Younger generations—specifically Millennials and Gen Z—are reshaping the credit union industry. Their values, behaviors, and expectations are driving a shift away from traditional banking models toward experiences that are seamless, tech-forward, and service-oriented.
The growing dominance of third-party investing apps underscores this trend. According to Cornerstone Advisors, $2.15 trillion has moved out of megabanks, regional banks, and community-based financial institutions into accounts with third-party investment apps, with Gen Z and Millennials accounting for over $1.28 trillion of these outflows. At the same time, satisfaction with traditional checking accounts remains modest, with Cornerstone reporting average value scores of just 7.59/10 for Gen Z and 7.78/10 for Millennials.
This data—and the report as a whole—highlights a clear opportunity for credit unions: by offering more value through the addition of solutions like digital investing services, they can capture and retain younger members while strengthening long-term engagement. Here are three data-driven strategies credit unions can use to meet these expectations and connect with the next generation of members.
1. Provide seamless digital investing tools
Younger members value convenience and integration. Research shows that Millennials and Gen Z are especially interested in digital investing that is built into their existing banking experience. Cornerstone’s data reinforces this, indicating that 45% of Millennials and 40% of Gen Z are interested in integrated investment services offered through their primary checking accounts.
The takeaway? Young members prefer the simplicity of managing both banking and investing within a single ecosystem, rather than opening separate investment accounts. Offering this seamless integration can set your credit union apart in a crowded financial marketplace.
2. Demystify investing through targeted education
Many younger consumers are hesitant to invest, not because they lack funds, but because they feel unsure about where to start. Cornerstone’s research shows that seven in ten non-investing Gen Z and Millennials have more than $5,000 in savings—more than enough to begin investing—but often lack awareness of affordable investment options.
By offering your members integrated digital investing and prioritizing accessible financial education initiatives, credit unions can empower younger members to confidently engage in these solutions. This approach not only drives participation but also positions your institution as a trusted, long-term financial partner.
3. Reduce investing friction with competitive features
Millennials and Gen Z value transparency, accessibility, and efficiency. InvestiFi’s forthcoming 2025 market research reveals that two-thirds of respondents experienced issues when buying or selling assets.
Credit unions can address this by offering integrated digital investing platforms with simplified fee structures and streamlined transaction processes. By reducing friction and making investing straightforward, credit unions can meet the expectations of younger members and foster loyalty over time.
Empowering action
Young members represent the future growth engine of the financial services industry. By adopting these data-driven strategies—seamless integration, targeted education, and frictionless investing—credit unions can evolve to meet their expectations and stand out in an increasingly competitive landscape.
For more actionable insights into addressing deposit outflows and attracting younger demographics, download the full Cornerstone Advisors report, “Stemming the Deposit Outflow: The $2 Trillion Investing Opportunity for Banks and Credit Unions.”
Stay tuned for the release of InvestiFi’s 2025 Market Research, which delves deeper into shifting investment behaviors and opportunities to grow your member base.
