10 things your members must know about their personal finances

Throughout my time in the financial services industry—as a state and federal financial services regulator as well as an attorney representing all aspects of the financial services industry—one topic that always remains in the forefront is financial literacy.

Volumes have been written and countless panels have attempted to find ways we can educate our youth on what they should know about their individual finances, as well as the products available to them.

We have all heard the stories about how high school and even college graduates cannot balance a checkbook, cannot read a monthly account statement, do not know how to budget, are unaware of the importance of saving and cannot compare financial services products to ensure they are getting what is best and affordable for them. And unfortunately, as they get older and need to make even more important financial decisions like car loans, mortgages, saving for college educations and retirement plans, many Americans continue to lack the required financial literacy skills.

This is not to say that government, trade groups, credit unions and consumer associations across the country have not attempted to remedy this situation through classes, seminars and publications, as well as one-on-one coaching. Despite all those efforts, we still are faced with individuals in every generation that lack the needed basic personal financial knowledge.

While some may say we tried and it is a never-ending, never-to-be-resolved battle, we cannot allow those setbacks or attitudes to cause us to diminish or slow down the efforts that must be made to get us and the U.S. on the track to full financial literacy.

In the past I have called on credit unions to be the leaders of the financial services industry. Whether it is rewriting mortgages for their members, holding the line on service charges or hiring veterans, I have always believed that credit unions could show others how it should be done.

I realize credit unions already have a lot on their plates. Just running a credit union is a full-time job; being involved in community activities, another part of the credit union heritage, adds additional time constraints to the everyday schedule. But financial literacy is too important for any of us to say we have more important things to do or we just don’t have the time. Our country’s strength is built on what we know and the ability to get things done. And so credit unions, you again must accept this challenge and lead the way.

So let’s make a list of some of the things that will foster a better understanding of what every individual should know about their personal finances and adopt as many as we can. Let these tasks become part of your credit union’s mission for your members.

1. Provide each member opening a new account a 15-minute education about the account. Aside from required disclosures, tell them how it works and what they need to know for it to work for them.
2. Offer and encourage members already with accounts to read a short booklet on things you need to know.
3. Ask individuals qualifying for a car loan or mortgage the questions that will enable representatives to fully explain what is available and ask the members questions that will create an educational dialog.
4. Educate your employees to know what to ask and what to say in order to provide as much information as possible.
5. Offer monthly education briefings at convenient times for members—30-minute sessions in the morning, afternoon and evening.
6. Get outside of the credit union. Go to the elementary, junior high and high schools, as well as the junior colleges and universities. Offer to provide 30-minute sessions as part of every course.
7. Go to your local city, township or village office. Offer to meet with employees quarterly to let them know what is available to them.
8. Visit senior centers that welcome guest speakers. Yes, even seniors need to know about financial literacy. Don’t forget to bring cookies or doughnuts.
9. Offer online, easy-to-understand short videos on checking, savings, accpimt statements, balancing checkbooks and all the stuff we all should know about.

10. Link your credit union to the wealth of information on the NCUA website such as MyCreditUnion.gov and Pocket Cents.

So there are ten easy steps to start with, but there are so many more. Credit union people: Come up with great ideas. I am certain you could do better than I.

If you already have a program that provides financial literacy education to your members and the children and adults of the communities you serve, share the knowledge of what works and what does not.

Let’s make this a credit union goal—to do all we can to end financial illiteracy and make the people of our country the most knowledgeable about their money and how to handle it.

As so often said, “The more you know, the better the decisions you make.”