April 13, 2010

Credit Union Management magazine’s Web-only “PR Insight” column runs the second Tuesday of each month.

April is the month for the showers that bring May flowers, yes? It’s also the month of spring break and probably a good time to shop for Mother’s Day gifts.

Anything else?

Uh, yeah. April is now officially Financial Literacy Month. The National Foundation for Credit Counseling (including a Web site dedicated to financial literacy for Spanish-speaking Americans) and it kind of makes you wonder if this type of thing works. Does calling a month “financial literacy month” actually accomplish anything? Should your credit union participate, making the most of this month designated for financial education? Or is it all just the creation of PR people with extra time on their hands? has said so. They’ve rolled out some nice programs to tie in with it (including a

Sorry. I don’t mean to sound cynical. But you do have to wonder about all the financial literacy events that make it to the press. Nice headlines, sure, but is it anything more than that? Are these days, weeks, months and maybe years dedicated to financial literacy—and the events that come with them—actually helping your members? And, most importantly, what kind of results can you expect for your efforts?

When planned the right way, with the right goals, an event (think financial literacy fair or workshop) can show members that you take their financial IQ seriously, and that you are here to help them manage their personal finances. It also can be used to showcase how your credit union can really make a difference to members. You can sign up new members at that type of event and enroll members in any financial literacy initiatives you might have in place.

Over and above that, your event can generate media attention which, in turn, can bring in new members, increase your trustworthiness to current members and highlight the credit union difference.

Any more tangible goals (such as having members change their financial behaviors or increasing member knowledge) may have to wait for longer-term programs. But an event can be your launching pad. It can be your starting point.

 According to Financial Education Practices in Credit Unions, a CUES white paper published in January, the most important goals to the credit unions that participated in a survey regarding financial education were (in order of importance to those credit unions): increasing member awareness of what they should be doing financially; educating members; helping members take action to meet their goals; and helping members change their financial behaviors.

 A full 93 percent of respondents felt their members had a need for financial education, which is not surprising. The survey results also detail what credit unions are doing toward building a more educated membership, and it is worth reading. Credit unions are doing financial education through a variety of media, including newsletters, e-mails, Webinars, and at-school presentations. Financial education events scored the following interesting points:

 59 percent of credit unions used community financial education events as part of their programs;

75 percent of credit unions using community financial education events considered them to be effective. (Remember that “effective” here applies as the goals expressed by these credit unions, which suggests you can see increased awareness and changed behavior from financial literacy events.)

Community events ranked among the top three ineffective tools, as well as the top three effective tools. That kind of suggests it can go either way. What makes it effective, as well as evidence of tangible results (Were goals set? What were they? Where they reached?) are not defined.

54 percent of responding credit unions held financial education workshops;

79 percent of those holding financial education workshops found them effective

Workshops also had the highest rate of abandonment, with many organizations reporting they had tried workshops and did not find them to be effective in terms of effort and cost for the results produced.

 One point in the study, however, really sums up the state of financial literacy efforts today: There is more of a need for it than a want. Members actually have to be bribed to make use of available financial education resources. That brings us back to events. If your events surrounding financial literacy month, or international credit union week, are fun, and members want to attend them, you may just have piqued your members’ interest in financial literacy, however you choose to deliver your programming. And that, of course, is a goal worth working toward, because it’s the first step toward the ultimate goals of increased awareness and better financial behaviors. And that end result definitely serves your members.

Laura Enock is CEO of CUVA and publisher of www.CUcontent.com, a newsletter and Web site content service for credit unions.