According to a 2017 WalletHub article, the Deep South states are some of the least financially literate states in the nation. This is unsurprising given the large number of Deep South households who depend on high-cost alternative financial services, like payday lenders and check cashers, and the high percentage of households without a rainy day fund.
The financial struggles that many Deep South households face emphasize the importance of financial education for today’s youth and the need for them to foster a positive relationship with a financial institution.
For example, Mississippi has the fourth highest rate of underbanked households in the nation with more than 300,000 households (25.5%) relying on costly alternative financial services for basic transactions and credit needs. This sobering statistic, coupled with the fact that over half (53.4%) of Mississippi households do not have enough savings to withstand a significant financial hardship, underscores the need to prepare today’s youth for a secure financial future.
In October 2017, Hope Credit Union (HOPE) opened its first student-run branch at Provine High School in Jackson, Mississippi – an essential first step to help local youth be better prepared for life-long financial success.
Policy in Action: Hope Credit Union Branch at Provine High School
In 2014, HOPE first partnered with Jackson Public Schools and Alignment Jackson’s Business and Finance Academy program to establish a student-run credit union branch at Provine High School.
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In three years, HOPE has touched approximately 80 students as part of the program, and nearly two dozen students have met with HOPE managers to learn about careers in finance.
This project provides students with a first-hand knowledge and hands-on experience in all facets of operating a financial institution, while simultaneously building the financial capacity of Provine students, staff, and other stakeholders.
Faculty and staff are eligible to open accounts at the school location during branch hours, which are two days a week. Students age 18 and older can also open accounts at the school location. In addition, HOPE provides financial literacy counseling to students, faculty, and staff.
Households who do not participate in the mainstream financial system are not able to smoothly endure major financial shocks.
It is imperative to increase access to safe and affordable financial products and services for local youth, in addition to comprehensive financial education, for the benefit of families and the economy as a whole.