Learning Better Money Management… From Financial Institutions?
Millennials are getting a bad rep when it comes to money management. Maybe it’s the lack of education from schools or it’s a topic that was never discussed at home. Either way, a recent study of millennials in two-year and four-year colleges shows bad habits related to banking, savings, credit cards, and student loans.
As discussed in “Millennials and Their Risky Financial Behaviors,” posted on TheFinancialBrand.com, college students are showing poor money management skills including materialism, compulsion, and less caution toward debt as the time spent in college advanced. Few students demonstrated the ability to pay credit card bills on time, follow a budget, or save money according to the study by EverFi and Higher One. The study also revealed that only 14% of students were using a money management app to manage finances, which is surprising given the reliance on mobile devices for other activities.
The study noted that students who took a financial literacy course in high school were 10 percentage points more likely to show financial management skills in college. However, only 17 states require a financial literacy element for high school graduates and only six states test them on it. Relying on parents for managing money can also contribute to the lack of financial wisdom as parents may not commonly talk to their kids about finances. Financial institutions could step in and fill the knowledge gap by offering students and parents the resources they need. A financial curriculum could include basic information about managing loans, credit cards, creating and following budgets, and navigating the different types of interest rates.
Banks can provide resources and educational information which can improve financial management skills and strengthen customer relationships. Banks can learn more about and connect with their customers with the support of a robust customer relationship management (CRM) solution. Capturing customer-centric data in a centralized location can put the information you need at your fingertips so you can provide services or offer the guidance needed as your customers reach key milestones. It’s not too late to teach millennials better financial management skills. Contact AKA Enterprise Solutions to learn more about connecting with customers and offering additional guidance and support services with CRM.