Wealth as a Game

Building Wealth – If ever there was a maze, it’s this.

Almost 40% of workers 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

Things in Europe and Australia are about as dire. It’s tough!

For many fund managers, having customers set and forget is a sound strategy particularly if contribution is compulsory. If customers see their portfolio they may start asking questions and costing the fund manager money. Yet there is a danger here. Most people end up with multiple funds. They take the default when they join a company because they don’t have any loyalty and don’t bother consolidating. The reality is that they don’t set and forget, they just forget. In a world of zero commissions as indicated by the Hayne review, advisers and life insurers will have to do better in publicly demonstrating the value of life insurance and the value of advice.

This is a massive problem for baby boomers particularly as the default program wont get them where they need to be. Remember, at first the Australian super ratio was zero and then 2%. 10% is a recent level of contribution and is a world leading mandatory contribution. Whether mandatory or volumtary, an large opportunity exists to help customers consolidate, contribute more and get on their game.

Australian superannuation assets totaled $4.1tn in September 2024, up from $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 global returmns on a roll, the ROI on this is increasingly unattractive. However, alternative products are complex, with multi-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 are listed on 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 are 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, Moroku regularly gets listed. 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 visualise 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.
Game design appeals to a broad range of personality types by providing clearly defined rules and rewards, engaging friends and family members and the clear visualisation of progress.
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.
Moroku recommend that wealth providers base any engagement on two key principles:
1/ It’s a journey – We’re not going to turn this around overnight but future customer capture is dependent on it. Take the time to map the journey from start to finish and think about all the things that need to occur for success to result.
2/ Make it fun. Its really boring and hard and that’s why people don’t do it. If clients are going to pay attention and start doing things they’d rather not we better make it fun and rewarding or they will revert to form.
Planner Salary $250,000
Overheads $110,000
Total FTE Costs $350,000
FUM Target $250,000
Fees 1% = $2.5K
Required # Customers 140
The business of planning is expensive and resource constrained. Sitting down with everyone is impossible and only really pays off for the wealthy, which interestingly may be those that need that advice less. In Australia, advisors have to date only been able to engage in man to man marking with those that have more than $250K to invest which is only 10 – 15% of the population. Let’s have a look at the numbers. A planner has about 220 days a year to get some work done. Seeing a customer every day isn’t regarded as feasible as there’s too much to be done. If each customer brings in $250K in Funds Under Management (FUM) that should generate about $2.5K in fees, meaning they need 140 customers each which is a lot of man to man marking.
Jason Gurandiano, head of financial technology investment banking at Deutsche Bank AG , “You have a shift from baby boomers to a tech-savvy generation that’s inheriting the wealth and doesn’t have an appetite to deal with a traditional broker at the golf club,” he said. But he added that his 20 years in the industry have taught him that “behavior also takes longer to disrupt than you originally think.”
Daniel R. Odio was CEO and co-founder of Socialize, Inc. The 39-year-old, who sold his social-media company two years ago, said he often uses Betterment’s iPhone app to add more money to his account. “It’s the gamification of investing. I love the feeling that I get when I use it,” he said.

Portfolio Example - Trading Titans

Welcome to **Trading Titans** – a thrilling virtual trading game designed to help customers hone their investing skills in an exciting and immersive way. The app builds financial prowess by engaging custoemrs in epic “Boss Fights” across a series of carefully crafted missions involving equities trading, index funds, and ready-made portfolios.

App Features

Epic Boss Fights: Players challenge formidable trading bosses in various market scenarios. Each victory brings the player closer to mastering the art of investing.
Missions: Diverse missions simulate real-world trading situations. Players learn the nuances of equities trading, dive into index funds, and explore ready-made portfolios.
Real-Time Market Data: Players stay informed and make decisions based on real-time market data to experience the pulse of live trading.
Content: Understand the core skills involved in investing through news stories and tips strategically integrated throughout the app.
Dynamic Trading Environment: Multi market data sets provide a dynamic and ever-changing market environment that helps players grasp the complexities of the financial world.
Progress Tracking: Player progress is monitored with in-game analytics and insights to see how far they’ve come and what areas need improvement.

Why Trading Titans

Trading Titans offers banks and wealth managers a unique and engaging way to build trust and relationships and help customers deepen their understanding of investing. With its blend of education and entertainment, this Odyssey app provides a comprehensive platform for building trading knowledge and confidence and growing customers.

Engage Moroku

Enage Moroku to define and deploy your next generation digital financial services experience
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