Australian superannuation assets totaled $2.8 trillion at the end of the March 2019 quarter. Some $0.7 Tn of this is estimated to be held in cash. With the base rate trending fast to zero and beyond, the RoI on this is increasingly unattractive. However, alternative products are complex, with 27-page documents to sign. By thinking about how to reduce the friction and add the fuel to a digital experience there is significant potential to change human behaviour, The significant complexity in the decision making process ensures that removing friction alone is not enough to overcome the status quo “leave it in cash – that’s what I trust”. We need to add the fuel.
The most innovative tech companies providing solutions for the global wealth and asset management industries in 2019 have been announced on this year’s WealthTech100 list (www.WealthTech100.com). This list identifies 100 of the companies that every leader in the wealth and asset management industries needs to know about.. The companies on the list were selected by a panel of analysts and industry experts who reviewed a study of over 1,000 WealthTech companies undertaken by FinTech Global.
After making the EY Wamtech finals in 2017, why did Moroku again make the cut? ” We’re betting on the providers who want their customers to engage, build loyalty and win. Almost 40% of workers with a retirement plan in the United States are woefully unprepared for retirement, with less than $25,000 in total savings and investments. That’s not a huge surprise when you consider that 21% of workers with an employer-sponsored retirement plan are not contributing to their plan; 44% are saving less than 10% of their income; and 33% are not familiar with their retirement plan’s investment options. Things in Europe and Australia are about the same.
Research from the MIT AgeLab suggests game design can make a significant difference in how a client responds to the type of retirement planning advice the industry offers. Too often, people don’t plan for retirement because it seems too boring, complex and scary. Financial wellness takes into account choices and consequences. However, many people can’t visualize their future well enough to understand the interplay of these concepts. That’s where game design and goals-based experiences, driven by nudge engines, can help.
People like to see how their choices impact their retirement goals, based on a number of inputs and assumptions. They like to see the positive impact of a higher savings rate. They get rewarded and encouraged for making progress. They can see how they are doing comparatively.People want to win and they like seeing themselves win.
There is a real opportunity to shift the amount of attention and effort people put into financial planning by engaging customers in their own retirement planning process, giving them more control and by so doing, diminish fear and indecision. Gamification is a great way to deliver a fun, interactive client experience that facilitates a more dynamic conversation and a deeper discovery process, which should result in better retirement outcomes.
This opportunity is particularly relevant for the target segment – Gen Y. Although Gen Y is often referred to as the “technology generation,” a more appropriate moniker would be the “connected” generation. Throughout their lives they have played online games to connect, compete and compare themselves with friends (both real and virtual). And there’s growing evidence that plan sponsors can leverage this mindset to design online gamified wealth management experiences that engage Gen Y around financial planning and well-being.