Functional and financial literacy: How credit unions can lead youth toward success in both
Photo by CDC
Functional and financial literacy are deeply connected, but their interdependence is often overlooked. Unless you’re in teaching, most people pay little attention—and have minimal understanding of either. As a result, they fail to see how vital both are to thriving in today’s world. Deficits in functional or financial literacy lead to poor outcomes at every level, from individual well-being to societal and economic health.
Deficits in literacy: A widespread challenge
Approximately half of North American adults lack functional literacy skills considered adequate for modern life. The Program for the International Assessment of Adult Competencies (PIAAC) reports that about 48% of U.S. adults perform at or below Level 2 in literacy, struggling with tasks like interpreting statistical data, evaluating written materials or managing day-to-day budgeting.
Similarly, financial literacy is alarmingly low. According to a Financial Industry Regulatory Authority (FINRA) study, fewer than half of U.S. adults can correctly answer basic questions about inflation, interest and risk diversification. This gap fuels financial insecurity, excessive debt and missed opportunities for economic growth.
Among youth, literacy gaps are exacerbated by disparities in financial education. The Council for Economic Education (CEE) found that only 25 U.S. states require high school students to take a financial literacy course, and even these vary in scope and depth.
In Canada, financial literacy education is even more inconsistent. Provinces like Quebec, Saskatchewan and Ontario mandate financial literacy courses, while others, such as British Columbia and Alberta, integrate financial literacy into broader subjects. This fragmented approach leaves many students ill-prepared to manage financial decisions effectively.
These deficits highlight the urgent need for accessible, engaging financial literacy programs. Structured education during formative years can help bridge the gap, fostering both functional and financial literacy skills vital to personal and societal well-being.
The monumental task of addressing literacy gaps
Improving literacy—whether functional or financial—is a complex challenge requiring a multifaceted approach. Solutions must navigate cultural, linguistic, societal and educational barriers, making a universal fix impossible. Yet, research shows education during formative years is especially impactful. Early interventions paired with "edutainment"—educational content infused with entertainment—are proven to boost engagement and retention. A study in the Journal of Educational Technology & Society (JETS) demonstrated that animations enhance understanding of complex concepts through engaging visual representations.
A solution rooted in community: Currency Marketing’s approach
At Currency Marketing, we saw these gaps and created It’s a Money Thing to address them. Combining our marketing expertise and roots in the credit union system, we designed It’s a Money Thing as a financial literacy program tailored to youth and young adults. By blending professional educational development with engaging, story-driven content, It’s a Money Thing challenges the traditional, uninspiring models of financial education.
The credit union system was a natural partner for this initiative. Built on co-operative values and community empowerment, credit unions are uniquely positioned to champion financial education. Their focus on member service aligns perfectly with It’s a Money Thing's goals.
It’s a Money Thing: Built for impact
It’s a Money Thing is designed for flexibility and engagement and is suitable for both online and classroom environments. The program features animated videos, presentations, handouts, infographics and classroom-ready lesson plans. Each topic embeds functional and financial literacy principles, ensuring learners gain practical skills to apply these concepts in their lives.
Topics covered in It’s a Money Thing:
Core financial literacy: Budgeting, credit scores, saving, debt repayment and investment vehicles
Personal financial management: Planning, managing spending and setting financial goals
Banking and credit: Predatory lending, credit card use and understanding banking accounts.
Life skills: grocery shopping, car buying and managing job transitions
Career and growth: Interview skills, starting a business and supporting local economies
Economic concepts: Compound interest, inflation and stock market basics
Consumer awareness: Spotting scams, debunking financial myths and comparing financial products
By integrating functional literacy into every topic, It’s a Money Thing ensures participants not only grasp financial concepts but also develop the practical skills necessary for real-world application.
Credit unions: A vital partner in youth education
Through partnerships with credit unions, It’s a Money Thing bridges critical educational gaps. Credit unions can incorporate all of the content directly on their website and offer it to schools at no cost, addressing curriculum deficits while fostering stronger relationships with their communities. By delivering engaging, professionally developed resources, credit unions position themselves as champions of youth empowerment and financial literacy.
A call to action
Addressing literacy gaps is no small task, but engaging, accessible education can make a transformative difference. Programs like It’s a Money Thing not only build financial and functional literacy but also strengthen community ties.
Credit unions have a unique opportunity to lead the way and achieve a true win-win. By delivering initiatives like It’s a Money Thing, they can empower the next generation with critical life skills while enhancing their role as community advocates.
Tim McAlpine is the Founder & CEO of Currency Marketing. He is best known for developing the It's a Money Thing Financial Education Program that credit unions from around North America are using to connect with new young adult members. He is also a driving force behind CUES Emerge, an emerging leader program that combines online learning, peer collaboration and an exciting competition component.
