In a Nutshell: The path to achieving financial wellness can be a struggle for many, but there are institutions that can help people build a better foundation for success. UMB Bank has served communities for more than a century, and one of its main goals is to help improve access to banking. The UMB Financial Wellness Center is tailored to empower learning and includes several resources like playlists and banking solution services.The bank also offers a number of ways families can invest wisely and protect wealth.
Financial freedom and having the ability to open a bank account or line of credit are basic banking needs that every person wants the capacity to do. But the stark reality is that people who have encountered negative financial events in life have more limitations than others.
It can be an albatross that makes one lose confidence that they will achieve fiscal mobility. And research suggests that having financial woes can affect mental and even physical health.
This underscores the seriousness of improving financial stability and the role that banks and other institutions can play in helping society.
UMB Bank recognizes the importance and has made efforts to help elevate its customers and communities. Much of that involves reaching out to people and understanding their financial situations. It also involves providing consumers with financial education advice and strategies to improve their investments and wealth management.
UMB’s Senior Vice President and Consumer Risk Officer, Jim Caniglia, said that what has really opened the door has been getting UMB bankers educated on how important it is to have conversations with customers and to understand each individual’s personal relationship with money.
Caniglia added that, in many cases, people experience life events, whether it be job loss, a business shutting down, family health crises, and so forth. And in the last couple of years, due to the pandemic, there have been more of these events.
Once UMB team members understand a person’s story, they can map that to the credit file and see how someone with a pristine credit file three or four years ago suddenly had an event that interrupted their financial course.
“There isn’t really a script that a banker goes through, but they’ve got a lot of good talking points to really help [people] and empathize with them,” said Caniglia.
For people with low credit scores, the hesitation that prevents them from getting the help they need is understandable. Making that phone call and booking an appointment is a big step in getting on the road to recovery. Caniglia said that, once the connection is made, it can become a more comfortable conversation.
Helping People Improve Their Financial Standing
To help people who are trying to elevate their financial standing, UMB offers a suite of credit card products. One of those products is its secured credit card, which launched two years ago.
It can be tough to get unsecured lines of credit for people who have had financial blemishes in their past and bad credit scores.
Caniglia said that UMB will occasionally offer an unsecured loan to customers if they have been with the bank and kept a depository relationship for a significant amount of time. But for those who don’t have that history, UMB offers the secured card.
Caniglia notes that, after a couple of years of issuing the card, the customer base is about an even mix between people who have previously had zero credit history and just want to establish credit, and those who have had some financial difficulties in the past.
Caniglia said that when trying to help customers on their banking journey, UMB takes an understanding approach to getting to know their needs.
For example, if somebody had a historic event even as recent as 12 months prior, and they’re now trying to dig their way out, the bankers at UMB are eager to help them. But for someone who had current charge offs in the past quarter, they may have to consider other products.
“For people who don’t qualify for our standard products when we approve them, the banker has a conversation with them about the importance of on-time payments and how that can begin to improve their credit score,” said Caniglia.
To make access to banking easier, UMB also has several flexible checking account options, including a free account that only requires a $10 minimum opening deposit.
UMB Senior Vice President and Community Development Director, Marisa Martinez, said that the goal of setting up these options is to help underserved, unbanked, and underbanked individuals.
“According to the FDIC 2021 National Survey of unbanked and underbanked households, 21.7% of people cited not having enough money to meet the minimum balance requirements as a main reason for not having a bank account,” said Martinez.
These kinds of accounts are intended to help customers manage their day-to-day financial needs and keep money in a safe place without having to worry about monthly fees. “At UMB, our free account makes up about 50% of retail banking new accounts since its launch in 2021,” said Martinez.
The Importance of Education in Finance
Anyone who has been in the trenches can attest that it’s not easy to have conversations about personal finances, especially with individuals they hardly know.
There are a lot of emotions that come into play because, while it can be numerical and quantified, there are personal life decisions that also affect the outcome. So establishing trust is a key component to helping people.
Martinez said that one of the things that UMB Bank has done is establish community banker positions that involve not only connecting banking solutions to communities, but also offering financial education classes on topics that include homeownership, small business finance, and personal finance.
To help people learn about fiscal responsibility, the bank created an access portal called the UMB Financial Education Center. It’s a library of learning topics that focus on personal finance education concepts like budgeting, investment, homeownership, retirement, and the like.
“The educational platform is free for anybody who wants to go into the site and use it like a playlist to create their own content,” said Martinez. “We also share the link with our community partners so they can integrate a more interactive platform when they’re teaching their financial education courses.”
The platform has proven to be quite popular, and Martinez said that it had about 5,000 users last year, along with 5,000 modules started. And the most-accessed module was the one on family conversations about money.
In addition to the tools that UMB provides to individuals, the bank also supports an organization called the School of Economics, which is a Kansas City nonprofit.
It provides hands-on field trips in which students learn about personal finance, how to run a small business, and pay taxes. In 2019, UMB expanded its partnership with the School of Economics by opening a second location for the nonprofit onsite at UMB’s downtown Kansas City campus. This expansion has allowed the School of Economics to double its impact and provide financial education and real-world experience to even more deserving students in the Kansas City area.
UMB has also partnered with a Kansas City agriculture education nonprofit called the American Royal. This partnership helped form the UMB Market, which is a grocery store and financial education simulation designed to teach children how to maintain healthy food choices within a given budget
“That is another example of how we not only talk about financial education, but we want to provide opportunities to apply that knowledge to all ages,” said Martinez. “So, from youths to adults, making sure that we’re providing those resources, building trust, and also making it accessible across the age spectrum.”
Volunteerism and Donations Impact Communities
UMB Bank has also made a commitment to the community through a number of outreach programs. Much of the bank’s community involvement is focused on arts, agriculture, financial education, and self-sufficiency.
UMB has programs for bank associates to engage with the communities they live in. One of those is a matching gift program that encourages each employee to make an out-of-pocket contribution, which the bank then matches. UMB also has a volunteer time-off program called VTO that provides every associate with 16 hours of paid time off to volunteer with an organization they are passionate about.
“Last year, we had associates on their own donate about $518,000 to 890 different nonprofit organizations, and then the matching portion was about $215,000 [from UMB],” said Martinez.
Martinez said that while these volunteer programs involve giving of time and talent resources, UMB’s employees are also receiving something of value. They are learning more about the community and expanding their awareness about issues that impact other people in different situations.
“Providing that gift and support, we’re getting that in return with the efforts that we’re doing and the outcomes we’re seeing through the organization and the connections we’re making,” said Martinez.