Financial well-being is not A thing credit unions do, but THE thing credit unions do. The Foundation is on a mission to catalyze credit unions into putting financial well-being at the heart of their strategy by providing ideas from organizations who are putting in the work to make that happen. Here are their stories.
Credit Union: BECU in Washington
What was the financial well-being problem?
To help BECU members increase their emergency savings. Why? Because building emergency savings improves financial resilience. When BECU started its work, the following data was available:
BECU’s Member Advantage Savings account was a popular product for BECU members and was designed to incentivize members to build and maintain $500 in savings, by offering the highest interest rate possible on the first $500 in the account.
In 2019, ~52% of BECU savings accounts receive the highest possible interest rate and of those, 56.6% of Member Advantage accounts have $500+ in them. The average amount per account for all savings accounts at BECU is $6,704. Additionally, in 2016 the Federal Reserve’s 2015 report on the economic well-being of U.S. households started getting a lot of press, particularly the data point that indicated that 47% percent of respondents said that either they would cover a $400 expense by borrowing or selling something, or they would not be able to come up with the $400 at all.
What did they do?
- Creates moments that fit people’s lives, helping participants prioritize spending time on their finances
- Offers real-time, confidential, one-on-one support and easy to follow guidance to provide accountability and prevent participants from putting off complex decisions
- Defaults to automation, to prevent participants from forgetting to take an action that will benefit them in the long-term, and that utilizes email/text alerts to capture attention and signal when actions are required.
The pilot results were encouraging, and since the pilot, the Financial Health Check has reached about 1,000-1,200 members/year.
What was the result?
The treatment and control groups from the FHC pilot were tracked for 14 months post pilot to analyze outcomes. Results included:
- Access to the FHC increased savings deposit activity by 4.7%
- Access to the FHC increased savings deposit amounts by 11.5%
- Access to the FHC increased net deposit amounts by 34%
In addition, as practitioners, we were particularly interested to see that the subgroup of the Treatment group that completed a FHC session hit savings thresholds of $500, $1,000, and $2,000 at significantly higher rates than the Control group.
In 2019, 53% of the members the FHC team spoke with set up an automated transfer to savings as a result of the conversation, putting $225 into savings on a regular (primarily monthly) basis. This is up from the 21% adoption rate we measured during the pilot.
We also use NPS to measure BECU member satisfaction with the FHC and with BECU overall. In 2019, overall satisfaction with the program was 9.41 out of 10, and the likelihood that a person completing a FHC would recommend BECU was 88.18. Anecdotally, we hear from members that the FHC session helped them feel ‘empowered’ and ‘in control’ – both in terms of managing their finances and in terms of better managing their accounts at BECU.
And, as a credit union, this conversation has also evolved. In 2020, BECU launched additional digital tools to help BECU members build incremental savings a few dollars/cents at a time, like round-up and a new slide-to-save feature in our mobile app.