ABA's Leggett: CUs do 'good job in financial education'

WASHINGTON (2/2/06)--The senior economist of the American Bankers Association (ABA) praised credit unions and their trade associations for "doing a good job in financial education" in a column on ABA's website.

"Hold on to your hats people: I am going to say something nice about credit unions," begins Keith Leggett, writing in ABA's "Industry Issues" (aba.com Feb. 1).

When he spoke to credit union CEOs and boards recently, he "was asked what the banking industry is doing in the area of consumer education. For example, are we educating our customers about '0%' financing and pointing out that these deals are not always the best deal?" he wrote.

"Many credit unions have made a commitment to improve the financial literacy of the American consumer," Leggett said. He cited statistics from the Credit Union National Association (CUNA): About one in three credit unions offer remedial financial counseling and one if five provide educational seminars.

"The numbers are much higher for larger credit unions, with almost 80% holding educational seminars. Many credit unions use their quarterly newsletters to educate customers about financial matters," Leggett wrote.

"It appears that financial education is part of the culture of credit unions," he says, pointing to a "host of products and programs for young people" on CUNA's website.

"By reaching out to educate youth about money matters, credit unions are building a relationship with the younger generation" to strengthen the tie between credit unions and future financial services customers, he wrote, adding the commitment "ultimately will leave banks in the cold."

Although more than 1,900 bankers went into schools during National Teach Children to Save Day, he cautions that "once a year does not earn a passing trade. If your idea of financial education is having a calculator on your website, this does not represent a commitment to education."

He cited surveys saying that the banking industry has lost Generation X and is in danger of losing Generation Y. He encouraged banks to set up a financial education program with ABA's help, so that "when that Generation Y person shuffles up to the credit union/bank fork in the road, that extra bit of education may make all the difference in the world."

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CUNA's Youth Initiatives
CUNA's Center for Personal Finance online products


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