The Erosion of Financial Awareness
Over 90% of millennials say they regret their spending habits, and overspending is at the core of many young adults’ unstable personal finance. The advent of easy payment methods such as “tap” and mobile purchases has eroded people’s awareness of their spending. Regaining control of spending habits demands a solution which elicits thoughtful spending and effective budgeting. This first step develops financial literacy and enables long-term planning for younger generations.
Savvy’s Solution
While many budgeting apps exist, they require too much effort on the user’s part to manually input their financial behavior and don’t address the core need of our target market - to be always conscious of all their purchases and to change their spending habits.
On top of typical budgeting app features, Savvy works to curb impulse spending and improve budget adherence by introducing social budgeting features and creating purchase decision points. Each functionality employs small behavioral “nudges” to keep the user on track.
Social Saving: Creating “Save Goals” to save for collective goals and friendly budget competitions with friends publicizes general financial habits without revealing confidential information. These social contracts help enforce each user’s adherence to their budget. For example, when planning a trip with friends or family, Savvy allows the user to challenge peers to meet a certain “Save Goal” per week or month. A tracker will monitor each participant’s progress towards the goal, prompting responsible spending behaviour. In our initial market survey, over 74% of respondents said this feature would help them control their impulse purchases.
Cognizant Spending: When making a purchase, Savvy creates a decision point by reminding users of their remaining monthly budget and asking them to confirm their decision, putting users in a deliberative thinking mode. For example, by prompting the user to confirm an impulse purchase, this feature will nudge them into changing their purchasing decision by reminding them of their budget. In our market survey, 80% of respondents said this feature would help stay on track with their monthly budget
