Financial literacy continues to be a challenge throughout the United States and Canada. Plan sponsors struggle with the most effective methods to educate their workforces regarding the management and use of money. These challenges were addressed at a recent presentation by Grant Jacobs, the Director of National Training for the International Brotherhood of Boilermakers in Alberta, Ontario.
Jacobs began his presentation with a brief video clip, in which a number of college students were asked the interest rate on their personal credit cards, followed by the length of Kim Kardashian’s marriage to Kris Humphries. Any guesses which question received more correct responses? Sadly, respondents seem to give Kim’s life more thought than their own financial future.
[Related: Financial Education for Today’s Workforce: 2016 Survey Results]
Grant continued to explain that financial challenges can be even more difficult for apprentices in the skilled trades, where initial salaries can be high, but stable income and benefit payments may be hard to come by. According to his research, 15% of people leaving the skilled trades do so for financial reasons. These financial stresses follow the apprentices and journeypersons home, where money issues are cited as the leading cause of marital conflict and divorce.
The Boilermakers knew they had a significant challenge on their hands and needed innovative strategies to communicate their message. How could they communicate to a young workforce that was already bogged down by the burden of extensive on-the-job training and technical classroom instruction? Their solution—gamification.
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The Boilermakers partnered with a vendor to add gaming mechanisms and techniques to their financial literacy lessons, engaging their apprentices and journey workers. Their curriculum focused on a five-step plan to pay down debt and invest for their future.
- Establish an emergency fund and spending plan.
- Pay off consumer debt.
- Increase emergency fund.
- Begin saving for the future and purchase of a home.
- Pay down mortgage and continue investing for the future.
Key takeaways make the Boilermakers’ financial literacy initiatives so successful
- Technical skills should be complemented by targeted life-skills training.
- Leverage the accessibility and flexibility of online training.
- Recruitment initiatives will suffer for lack of retention initiatives combined with attrition rate.
- Keep it simple and focused on subject matter that is most relevant to your target audience.
According to recent Foundation research, financial literacy programs are becoming more and more prevalent in skilled trades apprenticeship programs. Over 70% of responding funds offer training in financial literacy skills, which most commonly include retirement plan structures, savings, employee benefits, spending, credit cards, borrowing, balancing a checkbook and investments. Plans that offer programs are finding success. Over 75% of respondents that offer programs find them either somewhat or very successful.
[Related: Help your workforce increase their financial fitness by sharing these month-by-month tips.]
There is hope that using new and innovative techniques such as gamification will lead to more success, encouraging other funds to increase emphasis. Almost 50% of responding funds stated that they are planning on increasing emphasis in the next two years.
Justin Held, CEBS
Educational Program Specialist/Research Analyst at the International Foundation