Second Principle: Teaching Money Management

Teaching money management is the second principle of the SCU mission resulting naturally from the first, since it comes from the rules that the credit union has set for granting loans and opening bank accounts. This part of the mission is seen as vital by the SCU, because people may easily get into debt in modern society where companies, through their predatory advertising campaigns, persuade people to buy more and more, and banks encourage people to use overdrafts, which many people do. As this all may cause financial problems, the SCU understands that people need to be taught how to correctly manage their money and therefore it educates its members through its rules. Members who want to get a loan at the SCU have to fulfil some conditions such as proving that they are able to responsibly run their accounts by saving for at least 3 months or 8 weeks (respectively for monthly and weekly savers) before they become eligible for a loan. This rule shows them an advantage of saving. Actors at the SCU believe that teaching people how to manage money correctly is especially important in current economic conditions when work is not guaranteed because such knowledge may prevent them from going to doorstep lenders, getting into debts, and going into further poverty. This stream of the SCU mission represents as if the education or learning arm of the credit union. It underscores the social objective and character of the organisation enabling the Southeast Credit Union to embrace and disseminate social values unlike a traditional finance house.

It teaches that they have to save from start and then they have to sign to say they would pay so much back even if it’s only, say, ?1 a week or something. (Harriet)

(...) So it’s about, it was to help people with their financial management,

I mean, stop them having doorstep lenders who charge absolutely enormous rates of interests and pushing people into further poverty basically. (Peter)

The SCU actors recognise the importance of saving as a part of money management especially when they themselves once went through the process of learning how to use money appropriately. This makes them even more motivated to pass this knowledge onto other people.

(...) It took me a long time in my development to spend money properly, you know, not to waste it. So it’s education for me. But then all I can do is to try and educate other people. (Charles)

The Southeast Credit Union, while teaching people good money management, gets to know its members and learns if they are responsible and trustworthy. The SCU members, in turn, learn how to save and use money rationally, which means that they learn responsibility. Some members admit that they have never saved before because they were not able to put aside even a few pounds a month. But they are very pleased that they manage to do that now with the SCU guidance because they found that this gives them security and confidence.

(...) And some, you know, admitted that they’d never been able to save before. They are so exited about this money, these few pounds as some of them never had before at the end of the week money left. They usually ran out of the money towards the second half of the week and they were borrowing from their friends. But with this, with us they save and withdraw a couple of pounds at a time. (Emily)

The credit union decided to be present at schools because it is convinced that people should be taught from childhood how to manage money carefully. Schools, unfortunately, gave up on the saving programmes they used to run, so SCU filled that niche. Moreover, not everyone has role models who are an example of how to effectively manage finances. The SCU encourages children to become junior savers and to save on a regular basis, even if that would be 10p a week. The credit union assumes that it does not matter how much they save, as long as they save regularly and learn to manage their money properly. Hence the SCU has an even bigger task to complete than simply teaching money management, because it reminds society of the values of responsible financial management that have gradually been fading.

  • (...) And now you have children involved and schools. It’s a good thing for them to know if you want something, you save money for it. You know, it’s very easy if you have a piece of plastic to see something “Ow, ow I’ll get that, I’ll pay for that next month”, and a new month comes and bills come in and you think “O my God!” (...) (Donna)
  • (...) we don’t want to, you know, just challenge people’s pockets really, specially the kids’. I mean, if they put 10p a week that’s fine because they’re saving regularly. (...) (Louisa)

The Southeast Credit Union, by encouraging children to save, also wants to show them the joy coming from it. Jane recalled her school days when she was collecting saving stamps that she was sticking in a special book. When she had enough of them, she got a pound that she could either spend or put into her saving account. This was so exciting to Jane that she regrets that this saving scheme gradually died out at schools. Yet, she is pleased that the SCU picked up on the idea and engages children in its programme.

(...) It was so nice, you know, to be able to take, there were pennies and I was able to take a couple of pennies in a week and then it gradually built up into this lovely pound note. It was wonderful, wonderful. (...) And now that’s why I’m so pleased the credit union takes it into schools. That is so important. (Jane)

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