By Kevin Cohee, CEO of OneUnited Bank
In conversations with human resource professionals, the impact of financial stress on employee absenteeism and productivity becomes evident. HR experts often highlight instances where employees resort to borrowing from their 401K to prevent eviction or address challenges such as unexpected expenses. Recognizing the direct link between financial wellness and productivity underscores the importance of addressing financial literacy as a pivotal factor.
For decades, the neglect of financial literacy education in schools has allowed families to navigate financial challenges through trial and error. This issue is acute throughout our society, particularly in Black and Latino communities, where lower family incomes and limited financial resources intensify the challenges. To bridge the racial wealth gap and enhance employee productivity, tackling this challenge becomes both a necessity and an opportunity.
Outlined below are strategic solutions:
- Advocate for Financial Literacy Education in Schools
Businesses can advocate for a nationwide requirement to incorporate financial literacy education in schools. Proposing basic financial lessons, ideally starting in elementary school, will contribute to expanding financial literacy and empowering families to make informed decisions. Despite some progress, as highlighted by the Chaplain College’s Center for Financial Literacy, there is still a significant gap among states, with only a few earning high grades for their financial education requirements. Engaging in advocacy efforts to implement financial literacy across all fifty states is crucial.
- Utilize AI-Driven Tools for Informed Financial Decision-Making
It’s important to recognize the limitations of traditional comprehensive finance courses, especially for working adults with time constraints. Businesses can integrate artificial intelligence (AI) tools to assist families in making better financial decisions. AI-driven solutions can analyze spending patterns, identify areas for improvement, and provide real-time prompts akin to technologically driven navigation guidance systems. This practical approach ensures that families receive timely support to safeguard and optimize their financial resources.
- Collaborate with Arts and Entertainment for Engaging Financial Literacy
Financial institutions can partner with the arts and entertainment industry to create engaging content focused on financial literacy. Drawing inspiration from successful collaborations like OneUnited Bank’s venture with Marvel Comics and Visa, leverage popular culture to make financial education more rewarding and entertaining. By integrating basic financial concepts with entertainment, banking can shed its conventional image and become an exciting and rewarding endeavor for students and families alike.
Business professionals can explore the importance of financial literacy by participating in a short seven-question quiz offered by FINRA, the government-authorized non-profit organization which oversees U.S. broker-dealers and provides valuable insights into financial literacy levels.
To be clear, financial literacy alone cannot eradicate the racial wealth gap. While advocating for changes in public policy to address housing and transportation affordability, investing in financial literacy remains a cornerstone for wealth building and an impactful business investment. Together, the business community can play a powerful role in dramatically expanding financial literacy in 2024.
About Author:
Kevin Cohee is the Chairman & CEO of OneUnited Bank, the nation’s largest Black-owned bank. OneUnited Bank introduces WiseOne Insights, the first AI-driven financial wellness companion offered by a Black owned bank to support low-to-moderate income families in making sound financial decisions.