Get the Latest Updates Directly

Is Financial Education in Your 2021 Plan?

As you plan for 2021, don't overlook financial education. 

November 20, 2020

Yahoo News recently published an article titled The average American doesn't experience a financial wake-up call until the age of 33. Yes, it's as scary as it sounds.

Sixty-three percent of respondents to a OnePoll survey conducted by BOK Financial confess that financial matters "often" cause them stress, and 43 percent are "afraid" to even check their financials. 

The piece goes on to describe that COVID-10 has awoken many Millennials to the stark reality of their finances due to a job loss or reduction in salary. 

This angst jumps off the page: The feeling of not having a grip on your financials—nor a clue of how to get them on track—strikes despair in the hearts of readers, not just those stuck in the experience.

The Role of Financial Institutions

As financial institutions plan for 2021 initiatives and attempt to understand how to assist (and retain) their customers, there's one element that should not be overlooked: financial education. 

At its core, financial stress comes down to the basic emotion of fear. Fear that the individual won't have enough money to pay rent, bills, or support their current lifestyle. For many Millennials, this is also a fear of the unknown: having grown up without discussing money, they simply don't know where to start. 

If financial institutions can tap into this core emotion and relieve or lessen it for their clients during this tumultuous time, they've just secured a loyal customer. 

Now, you might be saying: Financial education is nothing new for banks. You've been handing out flyers and holding classes for years. But how often do you sit down and give folks the true nitty-gritty of how the financial system works and how they can use it to their benefit? 

Just as fintech is challenging the technical side of banking, entrepreneurs have dove headfirst into the emotional side. Challenging limiting beliefs and subconscious programming may seem a bit "woo-woo" for the average FI professional. Still, this mental training is often precisely what's required for financial security—and future success. 

Take a Leaf Out of the Financial Entrepreneur's Book 

Far from the classic teachings of David Ramsey comes the softer education of entrepreneurial money coaches. With a "just like you" approach and non-restrictive ideology, these social accounts and businesses have taken off, only boosted by the pandemic. Let's take a look at some financial brands that are doing well and the lessons that financial institutions can learn. 

Chloe Elise - Deeper Than Money

"Millennial money coach" Chloe Elise takes followers along on her journey as a young adult with aspirations of a more extraordinary life. She paid off her student debt, started saving and investing, and now teaches others to do the same. You can find Elise living her best life on Instagram and providing actionable money tips on her TikTok account and Deeper Than Money podcast. 

Both platforms take a strong position on the importance of a healthy money mindset, a core principle for the entrepreneur. With a potent mix of popular culture (her podcast theme song is Lil Dicky's $ave Dat Money) and smart financial advice, Elise knows how to garner an audience. 

Ramit Sethi - I Will Teach You to Be Rich 

In his NYT best-selling book, I Will Teach You to Be Rich (IWTY), Ramit Sethi takes readers through the basics of debt, credit cards, budgeting, and investing. Each week (broken down by chapters,) readers are encouraged to check one area of their financial system off the to-do list. Sethi inspires his followers to build their personal "Rich Life" and allocate money based on these priorities. 

Sethi boosts his brand by regularly showing his face on Instagram lives and IGTV, even starting a Fireside Chats series at the beginning of the pandemic. For audience members who want to take it a step further, the IWTY creator offers value-rich content on Instagram and paid courses on his website. 

You Need a Budget

The first highlight on the Instagram profile of You Need a Budget (YNAB) features a Millennial telling an all-too-familiar story. Hannah bemoans that she makes a decent living, but wonders where all her money goes. The solution: the YNAB app. But that's just the beginning. Throughout the extensive video content available on YNAB's profile, Hannah not only explains the workings of the app, but budgeting principles and financial information that the target audience will appreciate.

With frequent end-user features, meme compilations in Instagram stories, and financial education-rich Instagram posts, YBAB makes the path to financial literacy an enjoyable and impactful one. 

Check out our white paper detailing the challenges of financial institutions that you face today and how some of the biggest players are responding.

How to Build Your Own Education Initiative 

These financial brands have excellent methods and success to show for it. So what can we learn from these brands? 

  • Have a face for the brand: A singular face isn't necessary, but it certainly helps. Deeper Than Money's Chloe regularly posts TikToks and Instagram posts. You Need a Budget features Hannah with videos about budgeting, life, and how to use the app. And Ramit Sethi posts raw Instagram stories of himself talking about building your version of "the Rich Life." Including an individual storyteller helps users relate personally and makes the financial discussion a little less scary. 
  • Video, video, video: If you haven't already heard, video is the medium of the era. While animations are great, they aren't necessary. As walls come down with the WFH environment, raw, user-created content is becoming more accepted. Not to mention the popularity of TikTok, even with Millenials over 30. Get your video talent on Instagram, LinkedIn, Facebook, your website, and TikTok. 
  • Provide consistent value: Consistency is key for anything, including a loyal following or client base. By committing to showing up regularly with actionable or entertaining content, you are showing these individuals that you care. Furthermore, videos or posts with actual value show a level of expertise for your brand that fluff simply can't match. 
  • Draw a roadmap: Without a strong foundation in financial literacy, this information can be quite daunting. The solution? Provide education in small, achievable pieces, like in Sethi's I Will Teach You to Be Rich. Supply Millennials with a step-by-step guide to learning, getting their finances in order, and maintenance.
  • Education first: Provide value with no expectation of profit in return. Building trust through financial education is playing the long game. Provide, wait, and welcome new clients naturally. 

Ready to take on a more robust education platform? Employ these tips and do your own research to improve customer experience. Financial institutions have a unique opportunity in this unprecedented time: If you can be the rock that Millennials need and provide a solid financial education, you may just score a loyal customer. 

You might also be interested in

Audit Trails: How Financial Institutions Can Remain Compliant
5 Benefits of Teller Image Capture Check Scanning
The Ultimate Guide to Instant EMV Card Issuance