Regulatory Reform

Guest Post: National Financial Literacy Month a Time to Focus on Financial Wellbeing

financial-literacy

By: Gigi Hyland, Executive Director, National Credit Union Foundation

These days, every month bears its own theme or flavor. You know many of them –July is National Ice Cream Month, September is National Honey Month and October is National Apple Month. Alas, there is no National Chocolate Month (one of my favorite food groups). However, the National Confectioners Association has wisely designated several “candy holidays” dedicated to the glories of chocolate. Some designations—National Breast Cancer Awareness Month in October and Black History Month in February—take on a more important role as they focus attention and awareness on a particular topic to raise our societal consciousness, knowledge and understanding.

April is no exception. It is, after all, National Financial Literacy Month, a theme near and dear to the credit union system’s heart.

At the National Credit Union Foundation, our vision is to make financial freedom achievable through credit unions. Think about that for a moment. What would financial freedom really look like? We think it might look something like this: People have control over their money and financial decisions now and in the future. People have the ability to plan for and anticipate future events. And, people have options (e.g., they can save for retirement, send their kids to college and go on a restful vacation).

Interestingly, in a recent report by the Consumer Financial Protection Bureau (http://www.consumerfinance.gov/reports/financial-well-being/), the Bureau examined how best to define financial well-being and came up with these four elements:

  • Feeling in control – People who have high levels of financial well-being feel in control of their day-to-day and month-to-month finances.
  • Capacity to absorb a financial shock – Whether they get in a car accident or are temporarily laid off from a job, these consumers have a safety net such as savings, insurance, or family to help stop a shock from turning into a longer-lasting setback.
  • On track to meet goals – Consumers with a higher sense of financial well-being are on track to meet their financial goals. They are setting goals that are important to them, and working toward those goals. Think of this as moving toward financial freedom, for the future.
  • Flexibility to make choices – These consumers have the financial freedom to make the choices that allow them to enjoy life, whatever that means to them.

That said, credit unions do amazing things to strengthen their members’ financial well-being. It’s really part of a credit union’s DNA to incorporate financial education and resources to help people afford life and improve their financial circumstances. What do credit unions do? They offer online and in person resources and classes on how to buy a car or house, compare credit card rates and improve one’s credit score. They hold high school reality fairs to help kids understand through firsthand experience how to decide between wants and needs and develop a budget. Credit unions have in-school branches. They use BizKid$ (https://www.ncuf.coop/how-we-help/biz-kids/financial-literacy-curriculum.cmsx) in their branches and buy boxed sets for their schools and local Children’s Miracle Network hospital. These are just a few examples. In most cases, this tremendous effort is done quietly and without much fanfare because “It’s what we do.”

During National Financial Literacy Month, credit unions will organize a whole host of activities including:

Financial Fitness Day (http://financialfitnessday.com/); a National Youth Savings Challenge (FYI, last year 94,466 young members deposited more than $20.5 million into their savings accounts during the National Youth Savings Challenge —with 8,844 of those being new accounts!); participating in Jump$tart’s Financial Literacy Day on Capitol Hill; a Twitter chat through Nerdwallet, CUNA and the Foundation on savings; and lots more.

Yes, April is Financial Literacy Month. But helping members to achieve financial well-being? That’s 24/7/365 the mission of credit unions, not just the flavor of the month.


In Depth: Regulatory Reform

In his first inaugural address, Thomas Jefferson said that “the sum of good government” was one “which shall restrain men from injuring one another” and “shall leave them otherwise free to regulate their own pursuits of industry.” Sadly, governments – both federal and state – have ignored this axiom and …

+ Regulatory Reform In Depth