Credit unions must prioritize youth-centric financial solutions
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The credit union movement was built on the promise of people helping people. But as we look at the numbers and the shifting needs of our communities, it's clear that promise could be at risk if we don't adapt—and fast.
Today, there are just 4,499 federally insured credit unions serving 142 million members nationwide1, a number that continues to shrink each year. While total assets in federally insured credit unions rose to $2.31 trillion by the third quarter of 20242, the median asset and membership growth rates have turned negative, signaling that many individual credit unions are struggling to retain and attract new members.12
The root of this challenge is generational. Baby Boomers now make up the largest share of credit union members, while the percentage of Gen X, Millennials, and Gen Z members is shrinking or stagnating. This is a troubling trend, as younger generations are entering their prime borrowing years and represent the future of the movement. Yet, credit unions struggle to engage them.
Student loans are often the first major financial product for younger members. Yet in 2024, only about 16% of credit unions had a student loan on their books.3 This highlights how most credit unions are missing a vital entry point to serve and build loyalty with younger members, while the largest institutions are already leveraging student lending as a growth and engagement strategy.
While credit unions have made great strides in providing financial literacy tools covering budgeting, investing, retirement, and college planning, education alone is no longer enough. Members need real solutions, not just information. With private college tuition now exceeding $41,000 per year, higher education has become one of the biggest financial decisions families face-and for many, a major obstacle to building savings for retirement. As Department of Education policies grow more uncertain and federal funding becomes less reliable, it's time for credit unions to move beyond education and step up with practical, member-focused financing options.
Yet despite this urgent need, too many credit unions still refer borrowers elsewhere for education financing. This makes little sense. These are precisely the younger borrowers that credit unions need to retain and grow. How do we expect to get younger if we're sending our youngest potential members to other lenders?
Navy Federal Credit Union recognized this need and is now celebrating the 10-year anniversary of their education financing program. As Aaron Aggerwal, Navy Federal's Chief Lending Officer, recently shared on the 22 Minutes in Lending podcast: "Student lending isn't just a product; it's a pipeline. These are members we build relationships with for decades-not just during school, but through every major financial milestone afterward."
If you need further proof, look at SoFi. Founded in 2011 with a student loan refinancing program, SoFi now serves over 10 million members. Since acquiring a bank license in 2022, SoFi's total deposits have grown to approximately $27.3 billion4. Their success is a case study of how education financing can drive membership, deposits, and long-term engagement.
As Ron Shevlin, Chief Research Officer at Cornerstone Advisors, recently noted on 22 Minutes in Lending, "What credit unions should learn from SoFi is that it was not just the student loan focus, it was about designing and developing a product that resonated with a segment of the market. They built a product around rewards that rewards folks for payments and deposits and the right behaviors for both the consumer and the provider."
It's also important to clear up some persistent misconceptions surrounding private student loans. Unlike the highly politicized federal loan programs, private student loans are not driven by government agendas or shifting policy debates. Instead, they operate much like any other unsecured consumer loan: approval is based on the creditworthiness of the borrower and, in most cases, a creditworthy cosigner.
Private student loans are a practical financial tool, not a political football. When federal aid falls short, they fill the gap. For credit unions, they are also a powerful opportunity to engage younger members and build lifelong relationships.
Declining membership, industry consolidation, and generational shifts are real. So is the solution. By prioritizing education financing, student loan refinance, and real financial solutions—not just tools—credit unions can ensure their own future while truly serving the next generation.
Now is the time to act—not just to help our members, but to secure the future of the credit union movement itself.
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