The good life and how to achieve it

Today, there’s a huge divide in how financial services helps different generations. Baby boomers are the focus. They have money and assets and are therefore a profitable audience. But millennials are being left behind. As they approach the age where they want to settle down, there are very few places they can get the support and guidance they need.

That’s where Lifetise come in. Caroline Hughes, CEO and founder, popped in to explain their innovative approach to financial planning. Here’s a summary of what she had to say.

Lifetise are an innovative new start-up specialising in financial planning gamification. Their strapline, play your life better, is a great summary of their aim. They are creating tools and apps to help people better manage their money and plan for the future. It’s about changing behaviours – engendering healthy saving habits into a generation scared of their balance sheet.

When they started out, they realised that there are two major barriers to break through.

First off, people have a really complicated and highly emotional relationship with their finances. Most of us don’t view money as an abstract concept but rather a tangible means of achieving our personal ambitions and making our dreams a reality.

Secondly, there’s a big issue around engagement. People know they need to be more financially savvy, but they are frightened that they may discover they are further away from achieving what they need than they realise. So they bury their head in the sand. Fair enough, it’s a natural reaction.

So, Lifetise realised they need to empathise, engage and reassure with tools that provide information that is genuinely useful.

They started with a big research piece, identifying people’s hopes, worries, needs and where gaps are in the support they can access. This helped them draw some really useful conclusions. Banks used to help, but pulled funding when they realised it wasn’t profitable. And IFAs won’t touch you unless you have £150,000 to play with.

So when it comes to financial advice, the vast majority of people desperate to un-pause their life are being left high and dry.

There are two main areas people need help with planning. Unsurprisingly, it’s buying a house and having kids. The problem is, most people don’t know how much they need, what they should be earning to achieve that, and how long it will take them. It’s such a mental leap that they need to almost live through it to understand how to achieve it.

So far, they’ve started development of two brilliant financial modelling tools. The first is a really useful tool designed to help you work out how much money you need to buy a house, how long you’ll have to save and where you’ll be able to buy in the future. It helps you set realistic goals and understand what’s achievable. They are also working on a tool to help you plan how much you need to cover the cost of having children, including the cost of childcare, travel and many more factors. Next, they are working on a tool to help you model your whole life.

Today, their tools are extremely useful but a little visually underwhelming. But their plans for the future are another deal entirely. They let us take a sneak peak at what they have up their sleeve and it’s pretty spectacular. Think the Sims meets the Game of Life. And once the legislation roles out and the data is more easily accessible (as well as safe), they hope to launch a platform that helps your play out your life and see what you’ll need and when.

So, what’s their message to their users? “We want them to feel that everything is going to be okay. We’ll help you figure things out.” And that’s a refreshingly reassuring and optimistic message in a space that’s often doom and gloom.