Financial Literacy: Strategic Plans, FTEs, & Budgets

Do credit unions incorporate financial literacy into their strategic plans? Is it part of their mission statements to better their members' financial well-being? Is financial education a performance standard for staff? For management?

FTEs devoted to financial education

One-third of the credit unions CUNA surveyed have at least one full-time employee (FTE) working on financial literacy initiatives (Fig. 1).

Again, the bigger the credit union, the more likely it will devote staffing to financial education. In smaller credit unions-from $10 million to $20 million in assets--about 10% allocate staff to financial literacy.

Among credit unions with more than $50 million in assets more than 65% have at least one FTE devoted to member education.

Job descriptions should include financial education

Here's the rub. If financial education is a tenet that sets the credit union system apart from other providers, why don't more credit unions write the assignment into someone's job description? Only one-half of credit unions that offer financial literacy programs actually write it into a person's job description.

In fact, a cynic might suggest that credit unions that say they are providing financial education but don't include it in job descriptions or performance appraisals can't fail. After all, if you don't know where you are going, any road you take will take you there.

The good news for now is this: A majority of credit unions are taking this assignment very seriously because they are holding staff responsible for the assignment (Fig. 2).

As always, this often comes down to available resources. That's why larger credit unions are more apt to make financial literacy a job requirement. At least three-fourths of credit unions with more than $500 million in assets and credit unions that devote one FTE to financial education make it part of a staff member's job.

Financial education included in strategic plans

Two-thirds of credit unions that offer financial literacy programs make increasing members' financial literacy part of their written strategic plans (Fig. 2).

And, making financial literacy part of the credit union's strategic plan is more common among credit unions with assets of $100 million or more than it is with other credit unions.

Financial education as a budget line item

It's probably safe to bet that a majority of credit unions would say they are committed to providing financial education for their members. But is this attitude reflected at budget time? If credit unions are committed to providing financial education, are they more or less likely to include it in their annual budgets?

Less than 40% of credit unions offering financial literacy programs have a separate line item in their marketing budget or in another budget area that is dedicated specifically to financial literacy (Fig. 3).

Yes, it is true that larger credit unions--$50 million and above--are more likely to include financial literacy as a budget line item. However, even at its highest point--among those with assets of more than $500 million--only half of those credit unions offering financial literacy programs have a budget line item devoted to financial education initiatives.

Documentation of financial education efforts

Do credit unions measure the results of their financial education efforts? One of four do (Fig. 4).

Credit unions with more than $100 million in assets are more likely to document their financial education efforts than smaller credit unions. However, even at its highest point-among credit unions with assets of more than $500 million--less than half of those with financial literacy programs try to measure the success of their activities.

Copyright © 2008 - Credit Union National Association, Inc.