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Promoting Financial Literacy in Union Members

By Deborah Lynn Blumberg | Jul 8, 2019

The majority of Americans say they stress about money occasionally, according to the American Psychological Association (APA) — a common trend since the APA's first "Stress in America" survey in 2007.

Your union members are no different. For many, money may be a major source of chronic stress, which can cause a range of serious health problems, from heart disease to weight gain to depression. It can also be a source of distraction on the job, putting workers in dangerous industries at risk.

Here's how promoting financial literacy among your members can equip them to deal with their stress around money and maintain positive mental and physical health.

What Is Financial Literacy?

Financial literacy means understanding how to manage money. For example, a person with good financial literacy will understand how to make and stick to a budget, track spending, save for retirement, smartly manage debt, pay for college or a home, plan for taxes and invest their money.

Unfortunately, the major of Americans are not financially literate. According to data from the Financial Industry Regulatory Authority (FINRA), about 61% of Americans cannot pass a short financial literacy test. Those with limited knowledge run the risk of making poor financial decisions that could have a major impact on their lives, including taking on too much debt, improperly investing money or even having their home go into foreclosure.

Data from the National Financial Educator Council shows that, on average, adults surveyed lost $1,230 in 2018 as a result of not properly understanding household finances. In total, Americans' lack of financial literacy cost them $295 billion in 2018.

Those who understand key financial concepts are more likely to plan for retirement and have an emergency fund. They're also less likely to engage in expensive credit card behaviors like making only the minimum payment, according to FINRA.

For union members who, like most Americans, may not have the luxury of an emergency savings account, smart planning becomes even more important. Your members may struggle with budgeting or saving for retirement. Many may also be saddled with debt.

Promoting Financial Literacy

The first step to tackling the problem is education. Many members did not learn about personal finance in school; only five U.S. states require personal finance knowledge for high school graduation. And making the time on your own to understand what can feel like a complicated topic can be daunting. But the regular contact that you have with your members means that you're well-positioned to help.

Because members have a variety of life situations and time constraints, one size won't fit all. Consider developing a multipronged strategy for promoting financial literacy to reach the most members, and break the topic into bite-size pieces. Consider the following three strategies:

  1.  Leverage your communications. A simple way to start is to commit to including one piece of practical financial advice in each union newsletter. You might consult a financial adviser to help find unique, easily implemented tips that will add value.
  2.  Offer valuable resources. An excellent way for busy members to learn is during their commute with articles or podcasts that tackle the topic of financial literacy. "Life Kit," for example, is an advice podcast from NPR with several episodes about specific personal finance challenges. While traveling to work, union members can get practical, step-by-step guidance on investing and hear from financial advisers in engaging 15-to-30-minute episodes.
  3.  Bring in a pro. Union members will often have questions about how to become more financially responsible. Yet they might feel intimidated by the cost and time commitment of seeing a financial planner. Consider holding an occasional in-person seminar or workshop for interested union members on a specific topic — how to best save for college, for example, or a step-by-step plan to paying off debt. As a perk, you could also offer members a complimentary call with a financial planner once or twice a year. Often, a brief call with an expert can put those looking to increase their financial literary on the right path.

Whichever tactics you take toward promoting financial literacy, you'll want to measure how successful your communications are. If you include blurbs in your union newsletter, create a newsletter survey and ask how helpful the financial literacy information has been. If you suggest a podcast, during your next meeting, ask for a show of hands — how many people have listened to and benefited from it?

Ultimately, your goal is to help members become self-sufficient so they can apply lessons learned to their everyday lives, gain financial stability and set realistic financial goals. This will go a long way toward lowering union members' overall stress, making them happier and healthier.

With 15 years' experience writing for publications including The Wall Street Journal, Barron's, The Christian Science Monitor and Newsday — Deborah Blumberg specializes in business and finance and health and wellness. She writes about topics including corporate communications, financial markets, real estate, renewable energy, cancer, health education, nutrition, supplements, the microbiome and functional medicine. She was a Knight Center fellow and a Donald W. Reynolds National Center for Business Journalism fellow. Her time working in marketing and communications at JPMorgan Chase taught her how to best tell a company's story. She's adept at turning complex ideas into compelling copy. She's also an officer of the American Society of Journalists and Authors (ASJA) and a Women in the Visual and Literary Arts board member, and she is fluent in Spanish.