How can credit unions help members achieve financialwellness?

Is it enough for cooperatives to sponsor financial wellnessseminars, post how-to-manage money blogs and financial educationresources on their websites, or offer personal financial managementtools?

While these methods and others have had different levels ofsuccess for members, and have promoted the movement's message of“people helping people,” the $348 McGraw-Hill Federal Credit Unionhas taken a different approach to what president/CEO ShawnGilfedder said he believes will usher in a new era in financialservices.

And it all began when Hurricane Sandy swallowed the creditunion's lower Manhattan branch under 30 feet of water in October2012.

After Sandy ravaged the New York tristate area, millions ofhomeowners and thousands of businesses, including hundreds ofcredit unions, were in the dark for days because of widespreaddestruction and power outages. Some suffered in darkness forweeks.

However, for McGraw-Hill FCU, Hurricane Sandy created a catalystfor the credit union to transform its traditional branch at 55Water Street into what the cooperative claims to be the nation'sfirst financial wellness center.

“Manhattan right now is truly a flagship opportunity for us,”Gilfedder said. “That is the key driver and that is what we arelooking to emulate our business model after the learnings from[this new] location. It's allowing us to not only re-engage themembership population but also to reintroduce ourselves with thealignment of the brand message of financial wellness.”

The new center essentially personifies the cooperative's missionof helping its members achieve financial wellness. For years,McGraw-Hill FCU has promoted financial wellness to more than 23,000members by sponsoring a variety of programs for its 170 SEGs.

“Our goal is not to make every one of our members uber-wealthy,”he explained. “Our goal is to be able to provide them with a levelof service that fits their lifecycle needs. Financial wellness is astate of being for those individuals, and helping them definefinancial wellness within the scope of their finances is reallywhat we're after. We have some unique tools and resources withinthe environment in Manhattan to accomplish that.”

The 1,700-square-foot financial wellness center, which observeda grand opening on March 2, houses three meeting rooms, anadministrative office, back-office space and a front vestibule thatfeatures three large, interactive touch-screen kiosks.

“It's an interesting experience for some members when theyapproach the door and they realize this looks much different thananything they have experienced before,” Gilfedder explained.

Because more than 50% of the credit union's members regularlyuse online and mobile banking, the kiosks are essentially anextension of the same remote, touch-screen technology members usefor their daily banking needs. Other technologies at the centerinclude a Diebold 9900 In-Lobby Teller Terminal and smart ATMs thatcan handle 95% of common banking transactions.

“Our goal was to create an immersive environment where thephysical space emulated the virtual space that we are askingmembers to engage,” he said. “It allows us to shape the message andto shape the engagement of financial wellness, and that is what weare really after.”

Gilfedder believes that the familiar use of technology initiallyengages members in the center and quickly identifies their needs,which in turn facilitates a deeper discussion about theirindividual circumstances.

“In helping members understand how to engage with us and what weoffer to them as members, it promotes an enhanced discussion andallows us to have those really great conversations aroundrelationships and opportunities to help members be financiallywell,” he said.

Read more: Touch-screen kiosks help members takesteps to achieve financial goals…

The kiosks show four selections or windows that members canchoose: Financial Wellness Roadmap, Financial Wellness University,Remote Services Experience and Schedule an Appointment.

If members select the Financial Wellness Roadmap, a new screenappears with a list of statements to help them identify goals andchallenges about money, stuff (home, car, etc.), family and career.Under the money category, for example, specific statements such as,“I want to strengthen my savings” appear. After selecting astatement, members can drag it to a timeline of six months for ashort-term goal or 10 years for a long-term goal.

The center employs certified personal financial counselors and acertified financial planner, who carry tablets to show memberspossible solutions, plans and ideas.

“I think in years past, traditional banking tried to make theteller into that universal banker and promote those discussionsover the counter, but the physical layout became a real obstacleand it was somewhat awkward to have those conversations,” Gilfedderobserved. “With the teller counter, you are always standingopposite the member. In this space, we are standing next to themember in partnership, and I think that is important. Isn't thatwhat it means to be a credit union and a member of a credit union,to have a financial partner that is looking out for the member'sbest interest?”

Kathryn J. Davis, president/CEO of BALANCE/Consumer CreditCounseling Service of San Francisco, said financial wellness is onthe brink of getting big. McGraw-Hill FCU is a partner of BALANCE,an organization that helps individuals and families avoid financialproblems and teaches money management skills to achieve goals.

“I think employers will lead these [financial wellness] effortsand as a result will look for resources to help employees,” Davissaid.

Indeed, a recent survey by benefits consulting firm Aon Hewittfound that 93% of 250 large employers are very or moderately likelyto create or broaden their efforts on financial wellness topicsthat extend beyond retirement planning decisions.

Products, services and tools that provide savings and investingassistance to employees continue to gain favor among companies,according to the report.

McGraw-Hill FCU's Financial Wellness Center also may helpattract millennials, many of whom are struggling with student debtand other everyday financial challenges.

A millennial research study by the Principal Financial Groupfound that 70% of young people have set a goal of obtainingfinancial security, and 61% of them identified financial securityas their passion after raising a family (79%) and starting a family(62%).

However, only 25% of young people currently work with afinancial professional. Also 65% said they worked with a financialplanner to achieve financial goals, and 56% said they wanted todetermine the state of their current financial affairs.

Although 67% of young people hooked up with a financialprofessional recommended by a family member or friend, about 9%said they connected with a financial professional through theiremployer and 5% through their bank. Since McGraw-Hill FCU servesSEGs, this gives the credit union an advantage.

“We want to be a strong partner to help our (SEG) organizationsprovide financial wellness as a benefit for their employeepopulations,” Gilfedder said. “That is a strong differentiator forus.”

But since the Financial Wellness Center has only been open forseveral weeks, it's too early to say to what degree members willuse the center to address their financial challenges or simplymaintain their financial wellness.

Gilfedder promised to share what the credit union learns fromoperating the Financial Wellness Center with the industry.

“I am not kidding anybody by saying this will be an overnightsuccess,” he said. “This takes time and dedication. It's astrategic decision for us as an organization to follow thisprescriptive path, and we do see this as an evolutionary path.”