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CU Magazine: Four steps to a successful financial education program

Wednesday, April 23, 2014   (0 Comments)
Posted by: Craig Sauer, CU Magazine
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Photo source: Credit Union Magazine

Credit union folks who commit to financial education programs often say it’s life-changing for both members and themselves.

Embracing financial education programs also leads to many positive returns for credit unions—they’re seen as do-gooders in the community. It’s really a win-win, say financial education advocates.

“You get more hugs and people love your credit union,” says Kathryn Greiner, director of credit education at $519 million asset University of Michigan Credit Union in Ann Arbor. "It will bond your members to your credit union. They won't want to cause a loss because they're very dependent on the wonderful support and service that they get."

Greiner and other financial counseling advocates recently shared their experiences and four tips to successful financial education programs in a recent CUNA webinar, “Successful Financial Counseling and Education Programs.”

1. Make it simple

The goal of a successful financial education program should be to teach people how to help themselves. "I provide members the tools they need to continue after they have seen me," says Greiner of the one-on-one counseling sessions she conducts at University of Michigan Credit Union, which views financial counseling for members as a way to reduce bankruptcy risk.

“The whole goal is to simplify budgeting,” she says.

First, Greiner works with troubled members to write a budget analysis that lists income, base living expenses, and debts. Then, together they use an Excel form to develop a monthly spending plan so members always know what they can spend and enjoy, what goes to bills, and what to savings.

Greiner emails the forms to the members so they can continue the process on their own.

The spending plan includes using sub accounts to create savings accounts with names to clarify their purpose. Setting up automatic transfers to each sub account makes it “like paying a bill,” she says. “I found that when people had an understandable, livable budget and spending plan… they didn’t need to go bankrupt. They just needed to see an end to the debt—how they were going to do it.”

2. Discover your path

There is no substitute for rolling up your sleeves and sitting down with members, says Certified Credit Union Financial Counselor Sandie McKay...

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