Research shows Millennials, Girls and Credit Scores Benefit from Financial Education
Monday, April 11, 2016
Minnesota Credit Union Network – St. Paul, Minn (April 11, 2016) – Minnesota Credit Unions have assembled and reviewed the research to show how millennials, girls, and credit scores are benefiting from financial education such as that required in Minnesota.
During April, Minnesota’s Credit Unions will hold events in locations across Minnesota, as well as release a series of infographics and testimonials illustrating the benefits of financial education.
Minnesota ranks second nationally for financial literacy according to a new study from WalletHub. The ranking considers planning and daily habits, knowledge and education as well as “WalletLiteracy”, that considers “rainy day funds” and other data of Minnesotans.
Here’s a link to the WalletHub ranking: http://bit.ly/1oQKs1L
“The statistics about money stress and poor savings rates may seem daunting, but research also shows that Financial Education efforts work. Credit unions have long been leaders in this effort, as it is at the core of the credit union philosophy of ‘people helping people’,” said Andrea Molnau, Director of Communications at the Minnesota Credit Union Network.
Credit Unions throughout Minnesota will hold numerous events including:
- The Arrowhead Chapter of Credit Unions is holding an education session on ‘Managing Millennials’ in Duluth
- Wings Financial Credit Union (Apple Valley) is hosting two “Reality Fairs” with high school students in District 196
- Hometown Credit Union is encouraging Savings and Financial Fitness at its Owatonna High School branch
- Spire Credit Union (St. Paul) is reading to Kindergarten and First Grade Girl Scouts in Pine City
- United Educators Credit Union (Coon Rapids) is holding a Senior Fraud Prevention seminar in partnership with the MN Department of Commerce and LSS Financial Counseling Services
Some of the findings of numerous studies show:
Challenges for Money and Millennials
According to Moody’s Analytics, Americans under the age of 35 have a savings rate of negative 2%.
A FINRA study of Millennials aged 18 to 34 found that 67% have no rainy day funds, 60% aren’t saving for retirement, and 43% use costly non-bank borrowing methods.
Debt concerns weigh heavily on the group: four in ten Millennials say they are overwhelmed with debt, and more than half of Millennials say they are living paycheck to paycheck and unable to save for the future.
Knowledge is Girl Power
Particularly worrisome, studies have identified a gender gap in financial literacy, which is more widespread among single women and widows. Moreover, this gap is still present among young women and girls. A lower level of financial knowledge may have serious consequences because of the increasing individual responsibility for retirement security.
While more research is needed to understand the sources of gender differences in financial literacy, many women also tend to rate themselves low on a personal financial knowledge scale. This self-assessment makes them an ideal audience for financial education programs.
School-based Curriculum Means Better Credit Scores
Students exposed to mandated personal finance education exhibit meaningful improvements in credit outcomes. Three years following the implementation of mandates in Georgia, Idaho, and Texas, severe delinquency rates for those students receiving the education declined by 2% in Georgia, 2% in Idaho, and 6% in Texas, and credit scores increased by 2%, 3%, and 5% respectively.
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The Minnesota Credit Union Network is the statewide trade association that works to ensure the success, growth and vitality of Minnesota credit unions. With nearly $20 billion in assets, Minnesota credit unions are local, trusted financial cooperatives that serve more than 1.6 million members at almost 400 branch locations around the state. As not-for-profit institutions, credit unions give back to the communities they serve. For more information, visit www.mncun.org.