Creating an Impact in Communities with Financial Education

Written by Molly McKim

April is Financial Education Month

According to a recent study by Money Masters, 36% of the U.S. population is financially illiterate. Younger generations make up the highest percentages of illiteracy:

  • Millennials (41%)
  • Gen Z (58%)

According to WalletHub:

  • New Jersey ranks 10th as the most financially literate state, ranked 29th in financial planning and habits and ranked 12th in financial knowledge and education
  • Pennsylvania ranks 14th as the most financially literate state, ranked 23rd in financial planning and habits and ranked 17th in financial knowledge and education

Why is Financial Education Important?

Investopedia defines financial education as “the ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing.”

Financial education is the foundation for your entire relationship with money. A good understanding of money can help keep you from overspending, allow you to build wealth, and lower your stress levels overall.

Financial education is important to manage everyday life, navigate an unexpected event, or save for a comfortable retirement.

Empowering Communities Through Financial Education

Credit unions are dedicated to empowering their communities through financial education through programs, certified employees, financial reality fairs, and more to ensure everyone has resources to succeed.

There’s no better time to emphasize the value of financial education and its critical role in empowering both individuals and communities:

  • At the core of every thriving community is a commitment to financial well-being
  • Credit unions are leading the charge in this effort, helping people make informed financial choices that pave the way for a brighter future.
  • They extend beyond being places to save and borrow, and are dedicated to equipping individuals and families with the resources and knowledge they need to make smart financial decisions

Leading Financial Wellness in Communities

Credit unions are in a unique position to help their members to solidify their status as their members’ and community’s trusted financial resource for the future.

Credit unions have robust financial education programs—some are member-based, but many are free and open to the public. Many programs are online and video-based resources to teach budgeting, saving, and credit skills. Financial education isn’t only for students—many credit unions are hosting financial literacy webinars for adults. Additionally, many offer seminars on topics like budgeting, retirement investing, taxes, home- and car-buying, and insurance.

Proving Loans & Grants for Small Businesses and Community Development

Since credit unions don’t answer to investors, they can be more flexible with lending decisions. As small business advocates, credit unions often look beyond the figures on applications and build relationships with local start-ups through loans, investments, and other community-based initiatives.

Credit unions often open doors to financial services like savings and checking accounts, to those who are traditionally underserved, allowing economic inclusion in communities and assisting populations in need. These loans help to create jobs, revitalize neighborhoods, and support economic growth in underserved areas.

By providing this needed funding, credit unions help to fill a gap in the financial services market and promote economic growth in their communities

Leading Change in Schools

According to the National Endowment for Financial Education, as of 2024 only 26 states require high school students a personal finance course before graduating, with many of these states in their implementation phase.

So, if a child isn’t learning about personal finance at home, it’s likely they aren’t learning it at all. Financial education provides an opportunity for young people to start making smart financial decisions early, so they can set up a strong future for themselves.

Financial Reality Fairs are one large way credit unions filling this gap. Reality Fairs offer students a hands-on budgeting experience to learn personal financial management in a real-world context, with the goal of teaching them the value of using their money responsibly.

They have the change to ask important questions relating to:

  • Housing
  • Food
  • Transportation

They learn valuable key concepts that will guide them in every step of their adult lives and practice healthy money management skills. Reality Fairs help to empower students to be proactive about their financial futures and feel more confident in making financial decisions.

Improving financial literacy is essential for empowering individuals and communities to achieve financial stability and success. Through Financial Reality Fairs, credit unions can help continue build financially literate communities capable of making informed and beneficial financial decisions.

Creating Community Partners

Our credit unions also partner to work with nonprofits and other organizations in their communities. They reach new populations and offer vital information many did not learn in school or from their parents and provide resources that can be life-changing for them.

A few examples include:

  • Working with senior centers to teach about fraud and how seniors can protect themselves
  • Hold financial education workshops outside of schools
  • Make and share presentations about financial wellness
  • Collaborate with early learning centers to offer financial tools to young parents

Fostering Community Engagement

Credit unions are passionate about giving back to their local communities and fostering engagement with them.

They help to build strong and resilient communities by promoting financial literacy, volunteering their time and resources, demonstrating their commitment towards making a positive difference in their community. They host and sponsor events, charities, and volunteer programs that strengthen a sense of community while helping those in need. Some credit unions show their commitment by sponsoring festivals, concerts, sporting events, and other community events. Other credit unions go above-and-beyond by establishing charitable foundations specifically devoted to helping others

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