Finally—More Younger Members

Jon Haller
January 7, 2009 | COMMENTS

For the first time in more than two decades, credit unions have seen an increase in their ranks of “peak borrowers” (members age 25 to 44). They continue to struggle, however, to attract “future borrowers” (those age 18 to 24), according to CUNA's 2008 Member Statistics research. The research is a precursor to CUNA's more comprehensive National Member Survey and Survey of Potential Members--both scheduled for release next spring.

For many years, credit unions have been working diligently to attract more members in the peak borrowing years in an attempt to boost loan volume. Credit unions' diligence, combined with broader demographic forces, are contributing to a long-awaited up-tick in peak borrowers.

“While this is great news for the near future, credit unions' longer-term lending forecast is clouded by declines in the percentage of members age 18 to 24--the ‘future borrowers,'” says Jon Haller, CUNA's director of corporate and market research.

Past CUNA studies have shown that young adult nonmembers are most likely to say they're eligible to join a credit union but least likely to be familiar with the benefits of credit union membership. As such, they represent a large, attractive target market for credit unions' membership-growth efforts. But the young-adult market has been difficult to reach, and they have plenty of options to choose from.

Some credit unions came to the realization a long time ago that young adults represent the credit union movement's future. Many of these credit unions have been successful in reaching young adults and bringing them into the membership fold. Other credit unions are just coming to this realization. “The credit union movement as a collective group appears to still have a great deal of room for improvement in this area,” says Haller.

Credit unions that have been successful attracting large numbers of young adults say it takes a lot of time, effort, and commitment from senior management and the board. If your credit union has yet to take these steps, there's no better time than the present to begin the process.

“Statistics show that if you don't reach youth by the time they're 18 years old, you won't have them when they're 24 and have real buying power,” says Julie McLean, business development officer at Jeffco Credit Union, Lakewood, Colo. “Even if you're not seeing deposit growth when they're 20 years old, it's important to foster those relationships to create lifelong members.”

Jeffco implemented an extensive financial-literacy program more than 10 years ago to do just that and launched a comprehensive youth program about four years ago. “We needed tools to back up the basic education,” McLean says.

She believes it's essential to reach out to youth—via the media they use—if credit unions want to continue growing and thriving. “Even if you don't have schools to reach out to, you can go to so many other organizations. It has to be a focus for the future.”

For more about attracting young adults into your field of membership, check out a CUNA report titled "Best Practices: A Youthful Approach to CU Growth."

Jon Haller is CUNA's director of corporate and market research. Reprinted with permission.