After peak digital, trust may be going analogue
Photo by Caleb Oquendo
April is recognized as financial literacy month in the United States. In Canada, Financial Literacy Month takes place each November. Because credit unions operate across both markets, Currency Marketing’s work and research typically considers financial capability issues from a North American perspective rather than focusing on one country alone.
Each year these national observances prompt discussion about what people know about money and where the gaps remain. Research from economist Annamaria Lusardi and the Global Financial Literacy Excellence Center has consistently shown that many adults struggle with three basic financial concepts: interest compounding, inflation and risk diversification.
Across multiple studies, adult financial literacy has remained at roughly 50 percent, meaning about half of adults can answer these basic questions correctly. That level has shifted only a few percentage points over more than a decade of research.
This year we want to look at something slightly different. Not just the literacy statistics themselves but the environment in which financial education is happening.
Some observers of business and culture have suggested that after two decades of accelerating digital engagement we may be entering a period where people place greater value on human interaction again. Live gatherings. Community events. Face-to-face discussion.
Whether or not one accepts that framing, several strands of current research point in a similar direction. Trust in institutions remains fragile. At the same time people consistently report that meaningful engagement is more likely to occur through human interaction than through digital interfaces alone.
The financial literacy backdrop
The broader financial literacy picture remains challenging. Research from the FINRA Investor Education Foundation National Financial Capability Study shows that only about 27 percent of U.S. adults can correctly answer most basic financial knowledge questions covering concepts such as inflation, interest rates and investment risk.
Evidence of financial fragility appears in household balance sheets as well. According to the Federal Reserve Survey of Household Economics and Decisionmaking, 63 percent of adults say they could cover a $400 emergency expense using cash or its equivalent, meaning more than one third would need to borrow, sell something or delay payment.
Research from Annamaria Lusardi and the Global Financial Literacy Excellence Center also continues to show that about half of adults struggle with the basic financial concepts of interest compounding, inflation and risk diversification.
These patterns help explain why financial literacy remains a policy priority across North America.
Why the trust context matters
Research from the Edelman Trust Barometer continues to track public confidence in institutions. Recent reports show concern about economic systems and growing expectations that institutions demonstrate their value more clearly.
In Canada business, including financial services, continues to rank above government, media and non governmental organizations in public trust. Non-governmental organizations are independent non-profit groups that operate outside government structures.
Across generations many people say they want authenticity and relevance from the organizations they interact with. Not just polished digital interfaces. Evidence from the events and experience sector shows that shared live experiences are often associated with stronger outcomes on measures such as loyalty, advocacy and continued engagement with a brand or organization.
People who interact in person are more likely to remember the experience and maintain an ongoing relationship. Digital interaction remains extremely efficient but research on trust formation consistently finds that long-term relationships tend to develop when people interact directly with other people.
Credit unions have traditionally operated through local branches, community partnerships and member relationships.
Financial literacy is a human experience
It's a Money Thing from Currency Marketing is not simply digital content, it's a financial literacy program designed to work across digital and in-person environments. The structure supports several forms of engagement.
Classroom delivery where teachers and instructors discuss financial topics directly with students
Professional development resources for educators who integrate financial literacy into existing curriculum
Online access that allows students to revisit topics outside the classroom
Community settings such as schools, workplaces and community centres where financial topics can be discussed openly
Conversations that continue beyond the classroom as students discuss the subject with family members
Each of our topics include an animated video, an infographic, a presentation, an article, a handout and social media graphics
Financial literacy is often learned through discussion, examples and shared experience. This is particularly relevant today because the digital environment has changed how people encounter financial information.
Research from the Pew Research Center shows that while digital access to information has increased significantly, people frequently report frustration with the quality and reliability of information online. Financial advice in particular can be fragmented, contradictory or influenced by commercial incentives.
Many people prefer to discuss complex financial topics in settings where questions can be asked and answered directly. Financial literacy programs delivered in classrooms, workplaces and community settings reflect that preference.
This is not charity, it is strategy
Credit unions across the United States and Canada face two widely discussed structural realities. The average age of credit union members is typically higher than the average age of the surrounding population. In many markets the difference approaches a decade. At the same time digital member acquisition has become increasingly expensive. Advertising on platforms such as Facebook, TikTok and YouTube can generate awareness but competition is intense and conversion is uncertain.
Large groups of future members already gather in structured environments every day.
Schools and colleges
Workplaces and apprenticeship programs
Community organizations and youth programs
Financial literacy programs allow credit unions to engage these audiences in places where they already spend time.
