Access to financial opportunities, wellness, and literacy is crucial for everyone, yet there are huge discrepancies among demographics when it comes to those matters. Low financial literacy, which is essential knowledge about important financial topics that affect everyday life, is directly correlated with low financial wellness. When financial literacy education is not available, whole communities are gatekept from the boundless financial opportunities that can help set them up for financial success, help them out of financial messes, and help them achieve an overall better quality of life.
While financial literacy is low amongst all age demographics, the financial literacy gap becomes increasingly evident when it comes down to a couple of distinct factors: location and ethnicity/race, which can often go hand in hand. A 2021 report from the Federal Reserve tells us that the average white household in the U.S. earns just about twice as much as Black, Latino, and Hispanic households. Often referred to as the Racial Wealth Gap, this unbelievably prevalent phenomenon can be traced back centuries in America, and the issue continues to this day.
Inequitable access to financial education is a top contributor to the continuance of the Racial Wealth Gap in America, and it truly is on financial institutions like credit unions to get involved and do their part in turning this problem around. Financial literacy is a crucial facet of education that all too many are missing out on, but with the proper tools and motivation, we can all work together to make a positive difference.
Making financial literacy accessible in places where there has historically been a dearth is one of the first and most important steps in this process. Middle and high schools are often some of the very best places to help young folks get a head start on their financial wellness journeys, and with today’s modern educational tools, the task becomes easier than ever. Through continued community and member outreach, credit unions have the power to bring financial power back to the people.
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