MADISON, Wis. (11/8/10)--Generation Y, the second-largest generation ever, holds tremendous lending potential for credit unions. Yet banks are outperforming credit unions in reaching Gen Y. Shelly Vils, senior manager, credit union training for CUNA Mutual Group, shared that message with participants in CUNA Mutual’s Online Discovery Conference. Members of Gen Y, also known as “Millennials,” were born between 1982 and 2000, making them 10 to 28 years old. There are roughly 76 million members of Gen Y, compared to 77 million in the Baby Boom Generation, she said. Gen Y members are entering their prime borrowing years, Vils said, which positions them to replace Baby Boomers’ declining loan volume due to retirement. To attract Gen Y members, Vils said credit unions must understand their unique characteristics. Gen Y is the most diverse and best-educated generation in history, Vils said. They often carry heavy credit card and college debt, with 56% planning to live with their parents after college. They rely on friends and family for advice, with parents playing a key role in Gen Y decision-making. Other traits of Gen Y members:
* They will change jobs roughly every five years, so credit unions should reconsider loan policies related to job stability. * They are loyal to their financial institution. Once linked to the credit union by the right products and delivery channels, they are two times more likely to purchase additional products than Baby Boomers. * They are tech savvy and always “plugged in.” To reach Gen Y, replace traditional marketing channels and branch visits with tactics such as Facebook and Twitter posts and online seminars. * They are eager to learn and seek information online before buying. Credit unions can also consider holding seminars in places where young adults gather, rather than at the branch.