Improving The Financial Wellness of Children as a Credit Union or Bank
Children are the future. Here’s why your credit union or bank should be helping improve that future by enhancing the financial wellness of children in your community.
Backbase is on a mission to re-architect banking around the customer.
In fact, financial wellness goes beyond finances. As Renick mentioned in Forbes:
Learning how to manage money is a skill that carries consequences into both your personal and professional life.
As a credit union or bank, you’re uniquely positioned to help improve the financial wellness of the children in your community.
How Does it Benefit Your Institution to Help Improve the Financial Wellness of Children?
The most obvious answer is that one day, those children will be customers or members and you want them to be YOUR customers or members.
The chances of that happening increase if you help them understand money today, encourage them to open an account now which can be upgraded to an adult version when they’re older, and start building brand affinity before they get older and start looking for their own financial services provider.
More importantly, when they do get older, children “who recall learning about money at school are more likely to save frequently, have a bank account, and be confident managing their money.”
How to Improve the Financial Wellness of Children
From creating your own financial video game to helping parents understand how to talk to their children about money, the sky's the limit on how you can help enhance the financial wellness of children in your community. Here are just some ideas to help you get started.
Work With the Parents
Financial wellness starts with parents. Release regular information through an online blog, in-app recommendations, digital workshops, podcasts, and online videos to help parents understand their finances more and improve their financial wellness. This education will naturally be passed on to children.
Encourage parents, either through training branch representatives to bring up this important topic or by creating and marketing digital resources, to open a young-persons account for their child. Show them the value this will bring, the tools you’ve made available, and teach them how to broach the topic of finances with their children at different ages.
For example, this Girl Scout council put together a set of activities along with a local credit union to help inspire girls to become better money managers, which they rolled out with the assistance of parents. The set of activities targeted a range of ages, and included projects the entire family could work on together.
Digital Natives Need Digital Tools
With digital banking, online platforms, and mobile apps, banking for kids has long surpassed a simple checking account. Create and offer digital tools kids can use to gain a better understanding of their finances, for instance, an in-app budgeting tool, separate buckets to save for specific goals, and automatic expense and transaction categorizations.
The U.S. Mint also provides some great digital tools designed to help children and teenagers develop a better understanding of money. For example, they offer a range of fun games including quizzes, coloring studios, word quests, and more.
Use Video to your Advantage
Most children today are scrolling through social media, absorbing videos, and interacting with brands. Make the videos they find valuable by teaching financial education in an easy-to-digest format.
Use a mixture of captions, voiceovers, and visuals to keep their attention, and keep videos short and snappy. A typical format used among younger generations is role-playing out a scene, for instance, a discussion between two people on how and why they should manage their finances.
For example, Icon Credit Union created a YouTube channel that young people can watch with a parent or guardian to learn about the differences between credit and debit cards, what a credit score is, and how to maintain a high credit score.
Make it Fun
Even adults today have short attention spans. Make your content fun for everyone by using engaging formats, like mini video games, and by using storytelling to your advantage. Don’t just tell them how to manage their money, show them with practical digital activities and videos.
It’s time we stop acting like children aren’t interested in finances. They’re just not interested in discussing money the way adults do. But, that doesn’t stop them from loving Monopoly, using Money Mods on Minecraft, or collecting coins in Super Mario World. Consider how these gaming companies have sparked an interest in finances amongst their user base and use these tactics to create financial games that can help children truly gain a better understanding of money.
Financial Wellness Through the Ages
Children grow quickly, which is why credit unions and banks need to consider how their financial wellness strategies can resonate with each age group. Here are some ideas.
Under the age of five, children are only just becoming aware of money and numbers. Focus on helping them understand the difference between savings, expenses, and income. That simple differentiation can go a long way as they get older.
In fact, Renick, a children’s novel writer who's been teaching children about their finances has found this to be the perfect age to start learning about savings, as Forbes put it, Renick found, “that the earlier you start a child’s financial education process, the better. Lessons should begin before age seven [...] because research shows that money habits and attitudes are already formed by then.”
From Age 6 – 12
Older children can absorb more information on finances, as long as it’s given to them in an enjoyable format. Teach them about mortgages, budgeting, starting a business, and even retirement - just be sure to keep things light-hearted and use storytelling to get the message across.
From Age 13 – 15
Teenagers are starting to consider their long-term goals; start tying in financial wellness with actual real personal impact, for example, help them understand how saving and investing can help them go to the college they’re dreaming of, or how budgeting can help get them closer to the vacation they want to go on someday.
From Age 16 – 18
As teenagers start to get older, a strong focus should be placed on teaching them about credit, including how, when, and why they should be taking out loans or credit cards, and what the long-term impact of credit is on their monthly budget and stress levels.
The USA Gov page provides some examples of financial education 16 - 18 year olds may find useful, for example, information on getting federal student aid for college and which financial student loans may be available to help students reach their education goals.
A Digital Platform Built to Boost Engagement
Improving the financial wellness of children in your community all comes down to keeping them engaged. Backbase helps banks and credit unions deliver better banking experiences, and whether those experiences are brought to customers, members, small businesses, or even children is up to you.
Find out how we can help you start bringing financial wellness initiatives to your communities by scheduling a chat today.