Financial Literacy

In our research with families, parents regularly complain about their children's financial literacy and the lack of basic education on the subject in schools, especially at the elementary level. Many of them remember the time when financial institutions would come to the schools and have tours at their local branches-the vault was the big hit! The foundation of the teachings was "saving money" and having our own account. Unfortunately today, the parents say that their children learn spending but not saving (from whom?). I guess they have not been successful in transferring their knowledge to them or have their habits been the role model?

Some financial institutions, particularly credit unions, do have initiatives where they visit elementary schools, not only to discuss the benefits and process of savings, but also to return weekly to take students' small deposits. Yes, by all calculations the latter is a loss leader and there are security concerns. But, on the other hand have we forgotten the long term benefits of attachment and loyalty in a crowded marketplace? Having play sites in branches for children while parents do "banking" does not teach the basics- the activities are designed to occupy their time only. Then when you go to web sites, how often to you find basic videos and educational games that teach financial literacy?

Many youngsters today are on Facebook and other social media but all do not have savings accounts nor electronic access to their "information only". The Credit Union National Association has made financial literacy a top priority in the USA and many initiatives are under way for children, young adults, parents and seniors alike. Education programs and tailored advice are needed at every financial institution as part of each segment's basic value proposition. Perhaps 2012 is a good time to start the block building approach at your organization? The debt loads of consumers and their financial behaviours today need resolution at every age.

Pat Palmer | Monday, January 09, 2012 | Comments (0) | Trackbacks (0) | Permalink