BetterTradeOff (BTO) makes sound and comprehensive financial planning possible for everyone, with online platforms for consumers, advisers and financial institutions.
Easy-to-use, customizable and accessible to everyone. These are three buzzwords which fit the bill for the consumer’s ideal financial platform. Using advanced analytics and a powerful yet easy to understand interface, the Singapore-based startup aims to simplify the process for users. It does this by simulating a wide range of situations and goals, which allows them to see and better understand the financial impact of their decisions. With localized consumer and adviser versions to include respective rules, taxes and statistics of each country, the startup has already successfully positioned itself in Singapore, Hong Kong, the Philippines, Switzerland and the UAE.
We have asked BTO’s team to tell us a bit more about how they can help democratize financial planning by reaching everyone, regardless of financial knowledge.
Why do you think that setting up a long-term financial plan can be so confusing?
When it comes to planning the future, most people know what they want: a healthy, happy family, a child in a good school, a comfortable home and a happy, fulfilling retirement. What they don’t know is: what will it take financially to get there? How much will it cost to build and sustain the life they desire? And how much is enough to protect and secure that future?
Answering these tough questions isn’t always easy – even for those who are financially savvy, or masters of the EXCEL spreadsheet! This is because our lives and future aren’t static. They are constantly changing and not always in the way we expect or want them to. And the individual goals and dreams we have in life aren’t independent of each other – they’re intertwined and often competing, so when one aspect of our lives or finances change, it generally impacts the other aspects of life and our overall financial situation and plans.
All of this means that a financial plan isn’t a static, one-dimensional, document. It’s a living and constantly evolving roadmap that changes as you change and as the world around you changes. All of which can be confusing, and even intimidating, to many people. Which is why BTO set out to simplify and demystify financial planning.
Users can create an initial, end-to-end financial plan in less than 15 minutes by simply dragging and dropping specific life events or goals into their timeline and see immediately the impact on their yearly cash flow, net wealth and savings projections. Based on the information provided, the solution makes recommendations tailored to the user’s unique financial situation or a specific challenge they may face – such as having insufficient funds for retirement. Users can customize their plan by providing additional details and exploring new financial scenarios. The more information they provide, the more comprehensive and personalised plan they get in return. And while the user focuses on planning the future, the platform works in the background on perplexing matters such as accounting for local taxes, property rules, and other financial regulations to assure the financials are sound.
How does BTO improve awareness and make financial planning relevant to younger generations?
Today’s younger generations – The Millennials and Gen Z – are far more financially engaged than previous generations were at the same age. One study found that, on average, Gen Zers start thinking about financial planning at age 13 and that 64% have already begun researching and talking to others about financial planning. Even more encouraging is the fact that 89% of Gen Zers said that planning for their financial future makes them feel empowered.
These are also the first generation of ‘digital natives’, so as you would expect, they’re using the internet and digital tools when it comes to planning their finances. In another study, 39% of Gen Zers responded that they learned about personal finance from TikTok, YouTube and other social media outlets like Twitter or Instagram.
For this generation, BTO’s online solution is a perfect fit so it’s not surprising that 60% of the users on its direct-to-consumer platform Up are under the age of 35, with over 15% under 25. The solution is aligned with Millennial’s and Gen Zer’s ‘do-it-yourself’ mentality and gives them a platform to learn while doing, letting them see for themselves the power of financial fundamentals like starting early, spreading their investments over time and across different asset types, owning property versus renting, and so on. It’s a great place to test and try the – not always reliable – advice they get from sources such as TikTok.
How is BTO able to offer a cross-border solution relevant in both the Asian and European markets?
While people’s financial knowledge and experience with financial planning differs from region to region, a lack of accessibility to sound financial advice is surprisingly common. Even in Europe and North America, where the financial planning industry is well established, traditional financial planning practices are often seen as overly complex, unreliable, or only for the rich, leaving many without sound financial advice or a plan for the future. In Singapore, one of the world’s most sophisticated financial markets, only 1 in 3 women and 1 in 5 men have ever seen an adviser. This, despite the fact that 56% said they didn’t feel confident that they have enough to retire.
So, while people’s relationship with their finances varies globally, the need for simple yet sound financial planning is universal. And having a solution that’s simple enough for anyone to use, yet comprehensive enough to satisfy more sophisticated users, has allowed BTO to successfully deploy it in Asia, the Middle East and Europe across countries as diverse as the Philippines and Switzerland. The solution’s framework and engine design allow BTO to localise the solution for a new market in as little as three months, incorporating all relevant taxes – including property, rules related to social security and relevant voluntary schemes.
BetterTradeOff (BTO) is one of the 11 startups joining InsurTech Hub Munich FIN:SURE Innovation Sprint. Want to meet BTO and the rest of the startups and hear their pitches? You can join the FIN:SURE Showcase on November 9th and find out more about the results of our first Innovation Sprint.