Jack Henry & Associates : The Importance of Building Trust & Credibility with the Modern Member

First things first, I want to level with you. I'm a … Millennial.

Need proof? I'm glued to my smartphone. I expect instant and convenient everything. I think anything over a two-day shipping timeframe is unacceptable. I met my husband on a dating app. And I can't entirely disagree with Time calling me narcissistic, entitled, overly confident, and lazy.

Now that I've come clean about being a Millennial, it's time to admit something else: I have student loan debt. And I'm not alone. The truth is, student loan debt in the United States is crippling the fastest-growing segment of today's population. According to data published by ORC International, almost two-thirds of respondents to a survey of 1,000 Millennials reported owing at least $10,000 in student debt. More than a third owes more than $30,000.

Because of this debt, Millennials aren't buying cars, they're not getting married, and they're not buying houses: 41% of Millennials can't yet afford to buy a car, 17% are waiting to get married, and 31% are delaying buying a home - because they lack financial confidence. While I do have a car (that's still being financed), the other two are quite true for me personally. My husband and I waited to get married until we could afford the wedding; and we spent almost three years saving specifically to buy a house.

The Modern Member Craves Financial Confidence

I bring all this up to say I'm not unique. In early 2020, Jack Henry conducted a survey of more than 600 credit union members and bank customers and found that 47% feel financially stressed, 25% lack financial confidence, and 58% think they're bad at managing their money.

Members are most worried about getting out of debt, unforeseen large expenses, paying household bills, and healthcare expenses. When asked to rank their concerns about future finances, getting out of debt topped the charts across all age groups, coming in between 59% and 63%. Among Millennials, other top concerns included building up savings (44%) and buying a home (36%). Ages 36 - 50 cited paying household bills (52%); and the 51+ group listed unforeseen large expenses (63%) and healthcare expenses (59%).

The Modern Member Needs Your Help & Support

Your members crave financial confidence, but right now, they feel like their credit union isn't delivering. While 70% of respondents to Jack Henry's 2019 Modern Consumer Study said forecasting and budgeting is important to them, only 60% think their credit union is doing a good job of helping them.

In their moments of need, members should immediately be thinking of their credit union to help address these concerns. Trouble is, they don't see their credit unions as helpful in some of these areas. The likelihood of a member contacting their credit union for getting out of debt is 35%. For healthcare expenses, it's 22%; and it's 26% for paying their bills on time.

The Modern Member Needs to Trust You

How do you change your members' minds and increase their financial confidence? Trust and credibility. Your members need to see you as honest and ethical, reliable and dependable, easy to do business with, financially strong, and a provider of good service.

The first thing they need from you is to be able to trust you to handle the basics. They want to make sure they can pay bills online and deposit checks remotely. The next tier is addressing their concerns. They need you to help them get out of debt, resolve problems, pay bills on time, and handle unforeseen large expenses. As the generation with the largest job loss number (4.8 million) and highest unemployment rate (12.5%) due to COVID-19, Millennials especially are looking to you for guidance right now. And finally, they need to trust you to advise them in meaningful moments like addressing account fraud, buying a home, and planning for retirement.

Why You Need the Trust of the Modern Member

Members who are financially confident and feel their credit unions help them are eight times more likely to consider their credit union for a new product or service. They're five times more loyal, give 1.5 times more share of wallet, and use 1.3 times more products. They're also 14 times more likely to recommend you to family and friends.

Next Steps

The road to trustworthiness and credibility starts with a simple step: listening to your members.

Building trusted, authentic relationships has always been part of the credit union philosophy, so what's changed? Expectations. Technology has paved the way for more touchpoints and personalization than have ever existed before. Each generation has different needs of how and when they want to interact with your credit union. It's up to you to meet them where they are; to create a seamless experience and truly listen and understand what your members need.

Take me for example. Knowing what you know about me, if I were your member, how would you offer to help me? If you paid close attention, you'd likely offer loan consolidation assistance or maybe a budgeting workshop or a special savings plan. Helping your team understand the needs of each generation, truly listen to the member's needs, and offer timely solutions is key.

Listening to your members and learning what they're trying to achieve - big and small - will build the credibility and trust you need, undoubtedly leading to exceptional service and ultimately, member loyalty.