Why Credit Unions Should Play an Active Role in Member Retirement Planning
Retirement planning is about ensuring a stable, comfortable future free from financial stress, but unfortunately, more than half of Americans are not on track for retirement.
As pillars of community-based financial wellness, credit unions have the opportunity to guide members to a secure retirement. By assisting members with retirement planning, credit unions not only help their members’ financial position, they also improve their own standing through increased member retention and asset growth.
The Current Retirement Landscape
In the face of mounting challenges, saving for retirement has become more critical than ever. With healthcare costs soaring, lifespans extending, and the future of social security becoming uncertain, saving enough for retirement is difficult for the average person.
With the changing dynamics of retirement planning, credit unions are uniquely positioned to fill the gaps by providing personalized guidance via educational programs, financial coaching, investment products, and more. This shift in responsibility also means credit unions have a golden opportunity to deepen their relationship with members, ensuring long-term loyalty and growth.
The Benefits of Retirement Planning for Credit Unions
Retirement planning is not a one-sided affair. While the primary goal is to secure the financial future of individuals, the ripple effects of this planning resonate through the wider financial ecosystem, especially for credit unions. By championing the cause of retirement planning, credit unions can reap benefits that extend beyond just the well-being of their members. Here’s a detailed look into the benefits that retirement planning offers:
Member Loyalty and Retention
Deepened trust: By actively investing in their members' futures, credit unions send a clear message: "We're in this together." This deep-seated loyalty makes members less likely to switch financial institutions.
Multi-generational relationships: Retirement planning isn’t a one-time interaction. It’s a prolonged journey, meaning credit unions can nurture longer-lasting relationships with members that include engaging with members’ children and beyond.
Growth in Assets
Consistent savings flow: As your credit union teaches members to save for retirement, members can also learn more about reaching their general savings goals. This education allows credit unions to have better liquidity and increased operational capital.
Diversified financial products: With members investing in retirement products, credit unions have the chance to diversify and innovate their product offerings, making them more resilient against market fluctuations.
Positive Brand Image
Community impact: By assisting members in securing their futures, credit unions can further strengthen their image as pillars of community development.
Word of mouth recommendations: Satisfied members who feel cared for and guided during their financial journey are likely to recommend the credit union to friends and family, leading to organic growth.
Decreased Default Risks
Financially aware members: Education and guidance around retirement planning lead to better overall financial literacy. Well-informed members make sound financial decisions, decreasing the likelihood of loan defaults or delinquencies.
Stable repayment streams: Members who have a structured financial plan, including retirement savings, tend to have a more stable cash flow, ensuring timely repayments and fewer financial hiccups.
The Impact of Retirement Planning
The journey towards a secure retirement is a shared one between credit unions and their members. By actively participating in this journey, credit unions not only uplift their members but also pave the way for their own long-term success.
When helping members plan for retirement, the retirement planning tools your credit union offers makes all the difference. Paperwork’s white-label mobile app helps credit unions offer their members
Personalized retirement guidance through a chatbot
A digital organizer to store crucial documents
A holistic view of all their accounts in one place
To learn more about how Paperwork helps users set themselves up for success in retirement, schedule a free consultation today.