Financial advice can be a sensitive topic – those giving it don’t want to mislead customers, while customers are wary about the level of trust they can place in their advisers. Nonetheless, done correctly, investing can be a very beneficial way for someone to use their funds. This November we are exploring all the aspects of wealthtech and how the industry has developed this year.
Wealthtech is often associated with investing, but personal finance also falls under its umbrella and is a vital way fintechs can have an impact. In order for people to have a healthy attitude towards finances, they must be able to budget – understand how and when they should be spending money. This is, however, much easier said than done. But that is where wealthtechs can step up. To find out which firms have come up with the most innovative ideas to help with budgeting, we reached out to experts in the fintech industry.
Emma
Peter Wood, CTO at Spectrum Search
For Peter Wood, chief technical officer of Spectrum Search, the web3, crypto and blockchain recruitment agency, a budgeting app must be above all else convenient and easy to use. Budgeting can be arduous so a successful budgeting app should remove this effort. For Wood, this app is Emma.
“In 2024, Emma has been the talk of the town when it comes to wealthtech for budgeting. Honestly, it’s like having your own personal accountant in your pocket, without the awkward small talk.
“Emma makes tracking your spending across all your accounts and credit cards ridiculously easy, with real-time updates to keep you on your toes. What makes Emma stand out is how it doesn’t just lump everything together—it cleverly categorises your transactions and gives you a breakdown of where your money’s really going. And it doesn’t stop there!
“Emma uses AI to give you personalised budgeting advice based on your spending, so instead of just reacting to your monthly splurge, it helps you get ahead of the game. Plus, with all your bank accounts linked in one dashboard, it’s like having your financial life laid out on a plate—no more scrambling around different apps. It’s budgeting for people who’d rather not think about budgeting.”
Monarch Money and iCapital
Stephan Shipe, associate teaching professor of finance at Wake Forest University School of Business
Stephan Shipe, associate teaching professor of finance at Wake Forest University School of Business, notes that larger firms can integrate budgeting tools into their platforms, but also notes a standout wealthtech in Monarch Money.
“Monarch Money has emerged as a standout wealthtech tool, revolutionising how individuals and families manage their budgets. Its comprehensive, user-friendly platform allows users to track spending, set financial goals, and create customised budgets all in one place. Monarch Money also offers tools for forecasting and long-term planning, which makes it particularly useful for those looking to take control of their financial future.
“On a larger scale, companies like iCapital have made significant strides by integrating budgeting tools into their platforms, which cater to both high-net-worth individuals and institutional clients. These tools help users manage complex portfolios and investment strategies while keeping an eye on their overall financial health. As a result, the combination of ease-of-use and robust features in wealthtech tools like Monarch Money has helped individuals at various financial stages make informed decisions and stay on track with their financial goals.”
You Need a Budget, Empower and Honeydue
Steven Kibbel, senior editor at InternationalMoneyTransfer.com
There are multiple things to consider when looking for the right wealthtech for you. Steven Kibbel, senior editor at InternationalMoneyTransfer.com, the money transfer info provider, notes that while some services are stuck behind a pay wall, the control they provide over your finances makes the cost worth it.
“You Need a Budget (YNAB) is one of the most popular budgeting platforms for 2024. It is well-known for its proactive approach, which requires users to assign each dollar a purpose, which may be quite useful in keeping track of spending and saves.
“While it requires a monthly charge, its personalised budgeting and goal-setting capabilities make it a popular choice for those seeking greater control.
“Other programmes, such as Empower, are frequently utilised, but they take a broader approach, focusing on investments.
“Wealthtech is playing a significant role in increasing financial access. Honeydue, for example, is a shared budgeting tool that allows couples or households to manage their funds collectively.”
Uprise, Debbie, and Frich
Elizabeth McCluskey, managing director of discovery fund at TruStage Ventures
Elizabeth McCluskey, managing director of discovery fund at TruStage Ventures, the VC firm, notes how firms can make budgeting unique with rewards, targeting businesses as opposed to individuals, or certain demographics.
“The three wealthtech tools I’m most excited about in 2024 are from Uprise, Debbie, and Frich.
“Uprise provides embedded financial advisory services for small to medium-sized businesses (SMBs). Wealthtech tools are typically targeted at individual consumers.
“I love that Uprise recognises that for many small business owners, their personal wealth and their business finances are often heavily intertwined. Their tech enables the software companies already serving SMBs, like Rippling and Carry, to integrate financial planning tools so that SMBs can seamlessly manage their businesses and grow their wealth at the same time.
“Debbie takes a novel approach to wealthtech as the first rewards app that incentivises debt reduction and savings. While credit card companies have long incentivised spending by connecting it to points and redemption, Debbie is turning that model on its head and enabling consumers to reap rewards from demonstrating consistent behaviours around debt paydown and savings.
“Frich is a social finance app that leverages the power of community and benchmarking to help Gen Z develop better financial habits. Gen Z tends to get ignored by some of the larger wealthtech players, as they haven’t necessarily accumulated substantial wealth yet. But Frich helps this generation set themselves up for success in the long term.
“It is focused on some of their top priorities today including how to negotiate a raise, build their credit, and learn to invest. In meeting Gen Z where they are, it is building a trusted relationship for their wealth needs going forward.”
Chase
Jennifer White, senior director, of banking and payments intelligence at J.D. Power
As previously mentioned, budgeting can be time-consuming and monotonous. Not to mention slightly daunting as consumers can feel pressured to monitor every transaction they make, and as a result, potentially avoid buying essentials in an attempt to save money. Jennifer White, senior director, of banking and payments intelligence at J.D. Power, the data analytics firm observes how high street banks and fintechs can change normal transactions to feel like the user is actually saving.
“Many of the nation’s largest banks offer personal financial management tools which help customers that range from the most affluent to the everyday mass market customer manage their financial lives. In some cases, these same tools are leveraged by higher net-worth customers to manage wealth while also serving the needs of less financially healthy customers.
“Inside these tools there are many different options for financial tracking and analysis, but there are fewer options for seeing everything at once. That is, for aggregating your assets, accounts, and debts into one view. Chase is one of the national bank tools offering an aggregator service. If customers take the time to set it up, they can see everything in their finances in one place.”
Applicable to everyone
White continues: “While this concept is really something that on the surface feels more applicable to affluent customers today, you could argue that less affluent customers who take advantage would get a nice summary of debts vs. deposits instead of it being a big net worth tool.
“Next-generation tools will aim to shift from showing customers’ status on their assets, accounts, and debts and will leverage data from across their financial lives to do tasks like pre-populate a budget, help set realistic savings goals, and visually display progress towards these endeavours. When tools move beyond showing customers’ status and into helping them actively manage their accounts – then an everyday transaction can feel more like wealth building.”
The post Which Wealthtech Has Left the Best Impression in 2024? appeared first on The Fintech Times.
