Measuring the ROI of financial education for credit unions

Providing financial education from credit unions to their members is critical since it can be the key to a long-lasting partnership. Yet, despite its importance, quantifying the return on investment (ROI) for financial education programs often falls by the wayside. As we gear up for Financial Literacy Month, it’s particularly timely to unpack how credit union executives can measure and maximize ROI from financial education.

The value of financial education

Credit unions have long recognized the potential for financial education to transform their members’ financial well-being, citing wide-ranging benefits. But what are those benefits exactly, and why do they matter?

Boosting member financial health

The clearest benefit financial education yields is improved financial health. By becoming financially literate, members become better equipped to make financial choices such as managing debt, investing for the future, saving for emergencies, and improving their overall financial stability and health. Beyond direct finances, education also mitigates financial anxiety and aids in promoting overall wellbeing. Financial education is more than just a buzzword — it is a fundamental life skill members use to live more prosperous financial lives and achieve holistic personal wellness.

Improved member loyalty

Members who benefit from financial education programs are more likely to develop a deeper relationship with their credit union. This loyalty translates into multiple tangible benefits for the institution, including increased deposits, loan uptake, and utilization of other service offerings.

Educated members also feel more confident in their financial decisions, attributing their improved financial health to their credit union’s guidance. This bond not only fosters long-term membership, but also turns members into advocates for the credit union, helping to drive new member acquisition through positive word-of-mouth.

Benefits for credit unions

Financially literate members tend to be more active and responsible members. They are less likely to default on loans and more likely to utilize a wide array of financial products. Educated members also often become advocates for the credit union, spreading the word as brand ambassadors and elevating the credit union’s reputation.

Implementing effective financial education programs

To harness the full benefits of financial education, credit union executives must first consider how that education is delivered, as not all financial education programs are created equal. Effective financial literacy programs must prioritize accessibility and engagement to reach their full potential. While old-school tactics like live seminars or text-heavy workbooks may have done the trick in the past, they no longer meet the accessibility and engagement needs of the digital world and younger generations. Instead, prioritizing digitally-optimized financial literacy tools will help your credit union achieve the full array of financial education benefits.

Additionally, integrating financial education into every stage of the member’s life cycle — from youth accounts to retirement planning — ensures that members receive the right information at the right time.

Key metrics for measuring ROI in financial education

While the potential for ROI from financial education is evident, sometimes it can be challenging to determine how best to measure it. Depending on your credit union’s primary goals, there are a few possible metrics to consider tracking along with your financial education program.

Product and service utilization

Financial education empowers members to learn about more products and services, and to feel confident utilizing them. Programs that provide education on specific financial skills with pathways to actioning them through your products and services can increase their utilization. For example, education about loans with resources referencing your credit union’s loan options, can increase utilization of that offering. Better yet — it also increases the responsible usage of that offering.

Decrease in loan defaults

Educated members are better equipped to manage their personal finances. A downturn in loan defaults and late payments is a clear indication that the information and resources you are sharing with them are being successful.

Membership growth & retention

In addition to offering financial education to your existing member base, offering financial literacy programming to your wider community can be useful in building brand awareness and positive associations for your credit union. Especially for the millions of Americans desperate for effective financial education, financial literacy can be a great marketing and membership growth tool. It is also valuable in ensuring member retention for members who don’t want to lose access to essential financial education resources.

Improved financial literacy rates

Unsurprisingly, evaluating the improvement in members’ financial literacy is crucial to gauging the effectiveness of educational efforts. Employing both real-time knowledge assessments as well as pre- and post- tests at the beginning and end of different educational initiatives is the best way to comprehensively understand your community’s improvements in financial literacy both overall as well as on a detailed level.

Data collection methods

Assessments and tests

Employing quizzes and tests within your financial education programming can yield valuable data on your members’ financial literacy and improvement over time. Quizzes in the moment can help assess your members’ financial literacy in real-time, while pre- and post-tests can show their improvement over time. In addition to understanding users’ overall financial knowledge, these assessments can offer more specific data on their financial acumen for different subjects.

Not only do these quizzes help your credit union track important data, assessments also adhere to the learning science philosophy of The Testing Effect, which is known to increase knowledge retention long-term so your members can maintain their newfound knowledge.

Surveys and questionnaires

As important as it is to measure quantitative changes in financial literacy, it’s equally essential to gather more qualitative data. Integrating surveys and questionnaires that ask about members’ confidence, preferences, and other insights can be critical in understanding the efficacy of education provided as well as offer a deeper understanding of members and how to serve them.

User engagement analytics

Engagement metrics like lesson completion, time spent learning, referrals, and more can shed light on essential data for how users are learning from your platform.

While this may seem complicated and extensive, some financial education programs are built to make measuring impact and value easy. Fintechs like Zogo leverage data-driven, digitally optimized financial literacy tools to make it easy for you to measure and maximize the ROI of your financial education program. Ready for us to show you how we make it simple? Fill out the form below or contact the Zogo team today.


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Sydney Mayer

Sydney Mayer

Sydney Mayer is a Content Writer at Zogo. Born and raised in Denver, CO, Sydney went on to graduate from Carnegie Mellon University with a master’s degree in Professional ... Web: Details