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Starting with our "Welcome aBoard" post, our weekly blog addresses issues and topics of interest for Montana credit union board members. 

Discovery on Millennials Confidence Levels

by Donya Parrish, MCUN

Did you have a chance to participate in the free online Discovery Conference that CUNA Mutual Group held in mid-October? If not, you missed some engaging and relevant education. But, don’t despair, all the sessions are available on demand through June 2015.

Our staff took the time to gather and listen to Ben Rogers from Filene discuss “Gen Y Personal Finances: A Crisis of Confidence and Capability.” His session wasn’t just your typical message of telling your credit union to attract younger members. Instead, it was an interesting discussion of how badly millennials need financial literacy, and yet how overly confident they are in their ability to handle their finances. 70% of those surveyed rated themselves “high” in terms of their financial knowledge, but only 8% answered five basic financial literacy questions correctly.

That presents an interesting dilemma for credit unions. Simply providing products or education to this group doesn’t engage them. Remember they are already confident in what they know (or don't know). Instead, they want tools from their financial provider to make their life easier. 

A few other observations about this generation that might be of interest to your credit union. They do use debt, but they regularly use more expensive forms of it like credit cards and alternative financial services (34% have used pawn shops or payday lenders in the past five years). In addition, they also have heavy loads of student debt that are impeding their ability to buy homes. Millennials are also good at saving for retirement, but unfortunately, 22% of those surveyed had either borrowed or taken a hardship withdrawal in the previous 12 months.  

Mr. Rogers offered these tidbits of advice to assist your millennial members and potential members:

  • Just-in-time advice is more effective than general education
  • Debt education is best paired with debt service
  • Target student loans, credit cards, mortgages
  • Tools and messaging should be succinct, specific

So, while the millennial generation may look at the credit union’s products and services a little differently than those before, there is a lot of opportunity for credit unions to serve them and to improve their financial lives. Rather than looking at it as serving “that” generation, consider it a step toward bridging the gap of their knowledge and confidence in their knowledge.

Donya Parrish is the VP-Dues Supported Services for the Montana Credit Union Network. She would welcome any questions or comments on this material. You can email Donya or call her at 800-745-5546, ext. 122.

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