September 14, 2010

Credit Union Management magazine’s Web-only “Teaching Smart Money Management” column runs the second Tuesday of every month.

There’s so much we need to be careful about these days.

You’ve got to be politically correct, and in a diverse country like the U.S., it’s no simple matter to avoid stepping on people’s toes. That means accounting for all lifestyles, not saying ‘his’ without adding ‘hers,’ and including all colors, shapes, sizes and religions. But for financial literacy, it doesn’t end there.

You don’t want to hurt people’s feelings. If they feel like you’re talking down to them, they’re insulted; talk too technical and they can’t keep up. What’s a credit union to do?

Fortunately, a lot of that work has been done for you. Any financial literacy program you use has probably taken all that into account, and is at a level that works for the average American. If you’re going it alone, you’ll need to walk that fine line between respecting your members’ intelligence and fully explaining that which may be new to him (or her).

Yet there’s more.

You want to put financial responsibility—or lack of it—on the table. You want members to face the fact that they’re doing some things that are NOT in their best interest. As a credit union person I spoke with last week said, “If a member wants to spend all their money on hair and nails, that’s her business. But they’ve got to understand that the manicures are eating into their grocery money.”

Exactly right. And she can say it to me. But can she say it to a member?

Directly?

In so many words?

This is more than a dilemma. It’s a real problem, because as much as we all want to be positive, sometimes you just can’t be that way fully. Sometimes you really do need to put the facts on the table, hold up a mirror, and ask members to take a look. And it really, really isn’t easy.

Most of us (I’m putting myself on top of the list here ... my husband and I just had a nice little talk about how much of the back-to-school shopping was necessary and how much is a total luxury!) are financially irresponsible in some form or another. If we know it, though, and acknowledge how it’s affecting the big picture, well, it’s still not a good thing, but you can face a problem you’ve identified. For consumers who truly believes they need a payday loan, must get a weekly manicure and a daily fix at Starbucks, but somehow can’t pay the other bills, a wake-up call is in order.

Can you do it in a ‘positive’ way?

I’m going to say that no, you can’t.

I welcome you to disagree.

If your credit union has found a positive way to say “be responsible,” please let me know about it. If not, and it’s a message your members need to hear, take a look at this video (titled “It’s Not My Fault.”) 

We’ve set this up as one of our first four video content pieces for CUcontent.com. I’ve already heard a lot of feedback (starting with the video editor!) about the negativity. Is there another way? Maybe there is, but I haven’t found it yet.

I’m all for being positive. I think we get a lot further when we ask our co-workers, employees, kids and friends to help us, or even to change, in a nice tone of voice, stressing the positive. Negativity is a last resort, and preferably one you don’t use at all. But can you ask people to face up to a victim mentality without telling them they have it?

Can you overcome financial irresponsibility without facing the fact that you haven’t been handling your money in the best way possible?

Every 12-step program begins with an admission of a problem. For instance, my name is Laura (it is) and I’m an alcoholic (not, really, but hey, I’m making a point here). Is it realistic to expect a program that teaches budgeting, responsible use of credit, and careful savings to work for those who have a spending problem, or who don’t give a thought to how they plan—or don’t plan—money management?

I believe there needs to be some negativity there. But I’m open to hearing otherwise. If you think you need to be positive, and have found a positive way to get the word out there in a way that affects your members’ behavior, please let me know. Until then, I’m going to be somewhat negative. Not because I want to be, but because I genuinely believe it’s the best path to working toward a solution.

Laura Enock is CEO of CUVA and publisher of www.CUcontent.com, a social media, Web site, and newsletter content service for credit unions. Sign up to receive free marketing content every week at www.CUcontent.com.