Today, many young adults are experiencing stress when faced with taking responsibility for their finances and planning for the future. This is because most lack the skills, knowledge and confidence to do so. Average student loan debt continues to climb to never-before-seen amounts, but many young adults know little beyond a transactional bank account.
As a result, many report feeling unprepared to manage their money and consider it the “most daunting challenge of college for nearly all students.” So what can financial institutions do to promote financial health and support their student customers?
Better Financial Literacy
There is no doubt our nation’s financial education is lacking, especially among the youngest generations. In fact, only a handful of states have a personal finance requirement for high school students. This means when students leave high school to pursue higher education, they often take out high levels of student loans due to lack of preparedness from their shortage of education, and often, this leaves students unsure of whom to turn to for financial advice.
And, with an unawareness of their financial options, the knowledge gap puts young adults at a disadvantage on their path to financial wellness. While this is a serious concern, it provides an incredible opportunity for banks and credit unions because consumers need improved financial literacy. With financial education, a door is opened for financial institutions to take initiative and fill that void.
Knowing how financial institutions can help starts with finding the disconnect between young adults wanting financial help and not being properly educated in the earlier stages of their lives. Financial institutions can address this need through providing consumers with educational content that can not only improve customers’ financial literacy but also their own retention and acquisition.