A targeted and proactive approach by credit unions to help young consumers learn to better manage their money can help cultivate these Generation Y Americans into lifelong members. But those financial literacy efforts have to be tailored to the younger generation’s terms.
That was the message of Jim Merrill, senior vice president of sales and business development for LendKey, a CUNA Strategic Services alliance provider, during the CUNA Community Credit Union & Growth Conference.
“As credit unions and as an industry, we do need to make sure we are relevant to this Generation Y demographic,” Merrill said. “They have the ability to save and grow credit unions in the future. The generation is huge.”
Merrill told his audience to consider the numbers: There are 80 million Gen Y individuals. The last big population boom—the Baby Boomers—had just 76 million. As the aging Boomers move into retirement and out of the borrowing phases of their lives, the Gen Yers can more than take their place, Merrill said.
But the country’s young generation has different expectations than consumers of their parents’ generations. They expect their financial services—even financial literacy help—to be available 24/7, to be visually driven and interactive, personalized and targeted, and easy to find in an Internet search.
“And there must be some form of instant gratification--they must walk away with an immediate positive impression.” Otherwise, a credit unions’ best efforts are a waste of resources because one-third of Millennials make a decision within five seconds to leave a site if they aren't immediately engaged, Merrill warned.
He also said financial literacy education is a “wasted investment” without social media distribution. He said that credit unions should be getting to know, and getting comfortable with, the “new channels” of information distribution, such as Facebook, tumblr, Twitter, Instagram, Pinterest, and Reddit.
He also informed his audience that phones are overtaking PCs in information distribution. There was 81% growth in smartphone use in 2012 and 95 million consumers will shop in 2013 using a tablet, he reported.
“Ninety percent of us have our mobile device within an arms length of us 24 hours a day.”