Monday, November 27, 2023
New research published by First Merchants Bank has revealed the areas where 18-34s feel they lack financial confidence and highlights what they wish they had learned in school. Nearly 80% of respondents stated that better financial education could have prevented or reduced financial related stress and anxiety.
First Merchants Bank undertook this research following the announcement of the Financial Literacy Bill, which mandates schools in Indiana to include personal finance management and financial literacy education for their students, by 2027. First Merchants Bank’s aim was to determine the potential knowledge gaps around personal finance and money management amongst American adults aged between 18-34, and get their views on the importance of financial education in schools.
When asked where they obtain their financial advice and information, worryingly a third (33%) of respondents said that they get their information from celebrities and social media influencers.
Platforms such as Twitter (X) , Instagram and TikTok are increasingly being used by younger generations for information. People can search for information and find a plethora of user generated content, offering advice on various topics. While both the internet and social media can be a hub of valuable and accessible resources, there is a risk of this content becoming a replacement for regulated information from trusted banks and independent financial advisors. Financial misinformation has the potential to be damaging to financial wellbeing, so concern is growing around the trend of people seeking advice from unregulated sources.
Iesha Vaughn, Banking Center Manager, Avondale Meadows, representing First Merchants Bank commented on this, saying “While the internet does have some valuable resources, the risk of financial misinformation could have a significant impact on an individual’s financial situation. It is important to ensure that advice comes from regulated sources
First Merchants Bank also surveyed members of the public to better understand their confidence in managing their personal finances. 51% of survey respondents stated that they did not feel confident and needed to seek help and guidance when making financial decisions. The survey also revealed that when receiving financial advice from a lender or provider, only 49% of people felt they had the knowledge and understanding to use it. This data raises a key gap in financial confidence that needs to be addressed. 51% of survey respondents stated that they did not feel confident and needed to seek help and guidance when making financial decisions. The survey also revealed that when receiving financial advice from a lender or provider, only 49% of people felt they had the knowledge and understanding to use it. This data raises a key gap in financial confidence that needs to be addressed.
The Financial Education Bill is expected to help schools create a foundation for young people to better understand the basics of personal finances and where to seek support and guidance. According to the data gathered by First Merchants, 18-34's believe the following to be the most important financial lessons to be incorporated into school curriculums:
- Budgeting and managing monthly expenses (48%)
- Debt management (40%)
- The different types of loans and their implications (40%)
‘’The survey data has been key in helping us build a picture of what the public needs more support with when it comes to their personal finances,’’ comments Iesha Vaughn.
Vaughn expressed their excitement about the Financial Literacy Bill, explaining ‘’it is important that financial service providers and educators work together to help build the resources to create a strong foundation of financial knowledge for everyone. One bad financial decision can have long lasting negative consequences, so this legislation is so important in equipping future generations with the knowledge to make sound financial decisions, so they don’t have to learn the hard way.’’
‘‘I would also like to remind people that there are always local bankers available to talk through any information they are confused by. Never be embarrassed to ask a banker to explain. They are always happy to help!’’
To explore the survey findings further, visit the First Merchants Bank website, or watch this video to see what the public had to say about financial confidence.
These findings were sourced from a survey of 1000 18–34-year-olds who graduated from high schools in the states of Michigan, Ohio, Illinois, and Indiana. The data was collected between 1st - 11th September 2023.
Please find the supporting video content here.
ABOUT FIRST MERCHANTS CORPORATION
With nearly $18 billion in assets as of June 30, 2023, First Merchants Corporation (NASDAQ: FRME) is a registered bank holding company offering a full line of commercial and consumer banking services and wealth management services through First Merchants Bank and First Merchants Private Wealth Advisors in Indiana, Illinois, Michigan, and Ohio. With more than 130 years of enhancing the financial wellness of the diverse communities it serves, First Merchants makes meaningful contributions through Employee Empowerment, Philanthropy and Charitable Giving, Financial Wellness, Community Home and Business Lending, and Diversity, Equity, and Inclusion.The company has been honored for its attentive and knowledgeable service and culture by Forbes, Newsweek, American Banker, Comparably, and S&P Global Intelligence “Best Banks” awards. First Merchants Bank attributes this recognition to a mission-driven team that is passionate about “helping you prosper” through attentiveness as its genuine and unique approach to customer service.
To see how First Merchants Bank is making a difference, go to (www.firstmerchants.com).