The media often picks on millennials for a range of perceived shortcomings. And in doing so, they fail to see the good – millennials are purpose-driven, community-oriented, and motivated by their values.
And from an economic standpoint, millennials got the short end of the stick, dealing with a post-recession economy in which wages have not kept up with inflation. After being screwed over like this, it’s no wonder that they’re distrustful of big banks and financial institutions.
That, coupled with their love of tech, has created a successful boom in financial technology. Now more than ever, there are new apps to help manage your finances and even online-only banks. You can do everything from your smartphone.
But there’s another option that might be even better for millennials: credit unions.
Good Fit for Millennials
Credit unions are community-driven financial institutions that share their profits with their members. Credit unions have a more local feel than big banks, not to mention the benefit of having a vested interest in giving back to the community.
Because credit unions are not-for-profits, they use their earnings to better serve their members in the form of incentives like lower rates and fewer fees.
Meanwhile, millennials value transparency and like to support local, mission-driven causes. So it seems only natural that they can vote with their dollars by putting their money in a credit union that has their back.
Why Aren’t Millennials Jumping In?
Well, not all millennials know what credit unions are or how they operate. Some people are thrown off by the term “union” and think that membership may be restrictive or exclusive. This is not the case, though, as there are many credit unions that serve local communities.
On the other hand, credit unions don't necessarily market themselves to younger generations – something that many of them are trying to change. Currently, the average age of credit union members is over 47 years old.
“Credit unions will perhaps be the first to admit that they need to more vigorously promote the benefits of membership to younger consumers,” says Samantha Paxson, Chief Marketing and Experience Officer for CO-OP Financial Services.
The benefits of a credit union benefits include competitive rates on auto loans, small business loans, student loan consolidation, and more. On top of that, they offer more hands-on customer service and education to help you rock your finances. They also treat you like a person, not just a number.
“Credit unions truly are committed to partnering with their members and their communities to improve the financial wellbeing of both,” says Paxson. Serving their members includes keeping up with the latest technology. This helps to give a positive user experience and ensures that consumers have access to their money.
“Many consumers – not just millennials – are not aware that even though they are smaller institutions, credit unions offer the same level of convenient access as big banks via the nationwide CO-OP ATM and CO-OP Shared Branch cooperative networks,” Paxson explains.
“In addition, credit unions can offer comparable and even superior mobile, digital, and online payment services,” Paxson says.
Credit Union Benefits for Millennials
Millennials are just starting out in their financial life, and every dollar counts. Credit unions can help minimize fees, offer transparency, and provide personalized customer service – benefits that many millennials crave.
On top of that, many millennials may just be starting out on their credit and financial journey. And some of them are shut out of traditional financial services because they don’t have enough credit history or sufficient income.
Credit unions can often give opportunities and offer lower rates to consumers like these, who need it the most.
They can be great places to score a low-cost loan or start a savings account that earns more interest.
And to make it even better, millennials don’t have to forego their smartphones when joining a credit union, either. Mobile banking is the new norm. In essence, credit unions offer the technology that millennials are used to, plus the service and community feel that millennials want.