A study by the FINRA Foundation found that two-thirds of Americans are poised to fail a test on financial literacy. Are you surprised by that statistic? You probably should not be, considering the deck stacked against many Americans.
Recent studies also prove it. About 65% percent of employees have reported that their main financial problem is maintaining regular monthly expenses. 64% of employees are afraid of exhausting all of their money in the early stages of their retirement and being cashless for the most part.
Only about 43% of parents are confident and ready to talk to their children about finances. It becomes a very important social responsibility of the financial organizations to be responsible for the financial wellness of their customers.
How Financial Institutions Can Help Their Customers/Members with Personal Finance/Financial Wellness.
Below are some ways banks and credit unions can promote the financial wellness of their valued clients.
1. Provide adequate resources for financial education
Normally, financial education provided by financial institutions has to cover three types of target groups: Children, adults and of course, their parents, who’re also talking to the children. Make sure of it that the resources for the financial education of these groups are available on the financial institutions website and they have to be unbiased resources.
2. Train their employees
The employees of the financial institution are at the forefront of discussions with customers. By transforming their training on personal finance, you ensure the customers get the best possible engagement and the best information possible, and this training has to be an ongoing process.
3. Provide support for financial education in schools
The financial education provided in schools can make a major contribution to improving financial performance. By introducing, supporting or promoting such programs, financial institutions can facilitate access to financial education for the underbanked communities, and this also helps to fulfill their CRA requirements.
4. Start and promote smart banking for kids
In addition to providing financial education to children, the banks can also introduce banking for children, this allows children who are interested in basic or small-scale financial development to take advantage of. It also permits the kids to start early on to gather knowledge about financial institutions and also learn about money.
5. Promote the use of ebills
There is a rise in the adoption of e-bills as a means of payment across the country, banks and credit unions must make the most of this, by incorporating e-bill channels into their banking experiences. Not only will the extra cost of paying manually be wiped out, but it is also a very quick and secure method of transacting, and also allows customers to easily access their payment history and trends. If bank/credit unions allow their customers/members to see and pay all of their bills in one place on their banking site, this can drastically help their customer’s personal finance and overall financial wellness.
6. Suggest that your customers create and stick to their monthly budget
Managing finance is one of the many important things people can do to help themselves, and setting and living strictly on their budget is one and the easiest of them. There are many tools and apps financial institutions can provide to their customers to help them set and track their monthly expenses. The financial institutions app may even double or serve as one of those tools, reminding customers of going beyond the financial limit for the current month. So every month, with the help of these tools, customers can identify where exactly their money is going and where they can save. It can be an experience that transforms the finance of customers and consequently, their lives.
7. Offer personalized support
Financial Institutions should know their customers –so well. They can improve their financial wellness by providing personalized support based on their shopping trends, purchase habits, and other characteristics. These organizations can have a financial coach whom the customers can speak to whenever they need tips on issues related to their finance.
These are simple ways banks can help their customers improve their finance and financial wellness, thereby promoting a healthy financial lifestyle and further strengthening their relationship with their customers.