By and large, they're viewed with similar disdain byAmericans.

While the Centers for Disease Control and Prevention says 15% ofadult Americans smoke, recent Filene research into the borrowingoutlook of American consumers shows only 7% of current borrowersfeel confident enough to take out more debt in the next sixmonths.

We're not in very good company, it seems.

As a part of Filene's Center for Consumer Decision Making, ledby Hope Schau, professor at the University of Arizona, consumersare surveyed every six months to understand their attitudes aboutborrowing and their outlook for the future.

This survey, along with our work to understand the nuance andimplications of “money chatter” across multiple generations, helpspaint a picture where most consumers consider debt to be anecessary evil that should be avoided unless necessary, rather thana means to an aspirational end.

Fifty-two percent of survey respondents said they would take onmore debt in the next six months only if the need arises; anadditional 41% said they would avoid new debt during the same timeperiod at all costs.

Lack of earning power, worry about credit scores and economicconditions were the most significant barriers to borrowing amongthose surveyed.

A New Messaging Mandate

The survey's results should come as a wake-up call to creditunion marketers. Most consumers find debt as something to beavoided if possible and many consumers see debt as a source ofstress in their lives.

In fact, 81% of survey respondents indicated that debt is ofsome concern to them. Twelve percent said it's a major source ofdaily stress for their family.

For many credit unions, marketing of loan products focuses onaspirational images emblazoned on websites, branch posters andtargeted mailings. Families walking out of malls with bags in hand.Couples grinning from ear to ear with the keys to a shiny new carheld out proudly.

However, these are not the marketing messages most likely toresonate with members. When debt is equated with stress, thesemessages may not be realistic. Instead, credit unions should focuson more pragmatic marketing messages to connect with potentialborrowers and demonstrate how your loan offerings may reduce stresson the part of members.

The most obvious factor to focus on is rate, particularly ifyour credit union's rate can be compared to specific competitors ormarketplace averages to highlight potential cost savings.Especially in a rising rate environment, as highlighted by theFederal Reserve's March 15 decision to raise the Fed Funds rate by25 basis points, consumers will increasingly focus on the price ofcredit and look for more affordable options.

Beyond rate, consider modeling sample savings over the cost of atypical loan in your marketing messages. It can be difficult forthe typical consumer to understand what a 1% rate savings comparedto the bank across town will mean on a monthly basis.

Using sample loan balances and terms, quantify what the monthlyor annual interest savings could be for your loan compared toothers. This will require enhanced disclosure copy to demonstratehow these sample savings amounts are calculated, but that's a smallhurdle to overcome if you can help your member understand exactlyhow much they could save by choosing your credit union.

Creating an Impeccable ApplicationExperience

Of course, we know that intent to borrow may not perfectly pairup with the actual borrowing behavior of consumers. People needsudden home repairs, find themselves in cash crunches and get wooedby the spur-of-the-moment excitement of a new car.

This means your credit union must be ready at a moment's noticeto fulfill your member's loan need or you may lose that suddenopportunity to a competitor.

Having an online loan application experience that featuresnear-real-time decisioning has become table stakes for financialinstitutions. Yet, the live observational research we've conductedwith credit unions reveals this expectation often goes unmet.

Consider a member who may suddenly find themselves shopping fora new car on a weekend. If they aren't able to quickly and easilyapply for, be approved for and ultimately fund a loan withoutneeding to speak with a credit union employee or visit a branch,they are likely to seek out a competitor.

Better yet, help your member avoid much of the need to evenapply for a loan by consistently pre-approving members for basicproducts such as auto loans, credit cards and personal loans. Ifeligible members know they are pre-approved, then it is much morelikely they will seek out your credit union when the sudden needfor an unanticipated loan arises.

Once you've built an impeccable application experience, it'scritical that you let members know it exists. Again, consideringthat debt is a key driver of stress for members, any actions yourcredit union can take to assure the member their loan experiencewill be stress-free can pay off in the long run.

Be a Part of Each Generation's MoneyChatter

It's no surprise that millennials have a language all their ownwhen it comes to discussing finances. Our report, “MillennialMoney Chatter: A Guide to Millennial Financial Discourse,”looks at how millennials talk about money online. The researchrevealed millennial attitudes about debt are generally negative andthey use unique terms to characterize these attitudes.

Consider the Twitter hashtag #Debth, which we uncovered in ourresearch. This is probably the most negative metaphor imaginableand illustrates the extent to which young people see financialworries as a barrier to living a fulfilling life.

Once again, it is critical for credit unions to pay attention tothe way consumer attitudes are portrayed and then communicate withmillennials appropriately. When references to death are used todescribe loans, a pragmatic approach to sharing how your creditunion's loan products will minimize the worrying effects of debt isbest.

But millennials are just one of several generations that creditunions serve, and it's important to know just as much about how GenX members and baby boomers relate to money. Filene's next wave ofresearch will dive into understanding how these older generationsapproach finances and will undoubtedly provide insights to helpcredit unions relate to their needs.

Hopefully there will never come a time where credit union loanproducts face the same restrictions as cigarette ads. But in themeantime, by understanding the attitudes consumers have aboutlending products, credit unions can communicate the benefits ofloans without causing them to believe they'll be harmful to theirhealth.

Andrew Downin is Managing Director, Researchfor the Filene Research Institute. He can be reachedat 608-661-3746 or [email protected].