Making decisions on how or where to spend, save, or invest your money can be a troubling and difficult decision for consumers. According to a recent study by the American Psychological Association, as many as 80% of American consumers are stressed because of money concerns. When faced with financial decisions, some people freeze like a deer in headlights, make no decision, and let fate dictate their future. Other times, they seek to become informed on a topic, only to become overwhelmed by conflicting “evidence” and end up failing to make a decision because they can’t successfully analyze the information.
This can be summed up as “paralysis by analysis,” and it can impact consumers’ financial decision making in negative ways.
To assist consumers in their financial wellness, many banking institutions provide free financial literacy training to their customers and communities. Financial literacy is the possession of skills, knowledge, and behaviors that allow an individual to make informed decisions regarding money. We know that informed consumers make better decisions as financial literacy training has shown to improve the rate at which consumers save for retirement and increase participation in the stock market.
Financial literacy provides education on multiple areas including:
- Home ownership and mortgages
- Monthly and annual budgeting
- Credit Card usage and management
- Retirement planning
- Savings and investing
Providing communities with financial literacy training is a great mechanism for growing a bank’s customer base. And, marketing these initiatives has proven to increase brand favorability, trust, and perception of commitment to the community, all of which lead to increased customer acquisition and greater deposit volume. Providing and communicating these services into your financial marketing efforts will ensure customer trust and will give consumers the confidence they need to make informed financial decisions.