Banking and Fintech Trends - An Interview with Jon Ogden of MX

Levanto CEO Daniel Chen sat down with Jon Ogden, Director of Content Marketing at MX, to discuss current trends in the finance industry. Based in Provo, Utah, MX is a leader in digital money management and marketing solutions that enable financial institutions to win account holders from their competitors.

For the past 2 decades, technology advances in fintech have been focused on significantly improving convenience for the consumer. As consumer behavior and expectations for convenience and accessibility rapidly increase, established financial institutions are having difficulty keeping up. Smaller companies like MX and Levanto are rising to the occasion with cutting-edge technology, design, and delivery. In the following interview, Jon gives us insight into what the future has in store.

 

What are the top trends in banking that will shape the industry for consumers in the next 5 years?  

The top trend in banking is that consumers increasingly demand digital convenience above all else. They look at traditional financial institutions and see little difference in security, rates, and customer service, and so they choose what is most convenient. Currently this means that consumers are flocking to the big banks because these banks have the budget to offer a better digital experience. Friendly tellers and customer service, which banks have long emphasized, are becoming increasingly less important as the companies who provide convenient digital experiences win out.

It makes me think of when I tried to set up a joint savings account with a local community bank. When I got to the branch, I found out that the bank wanted me to take a signature card back home, have my wife sign it, and then drive back to the branch so they could finish opening the account. So I went home, checked out some options from Capital One 360, and signed up for a joint savings account there instead — all within 30 seconds. The local bank had every reason to get my business, but Capital One 360 won because of convenience.

 

Who is leading innovation in the fintech industry?

On Banks
BBVA is a respectable example of a large financial institution with leading innovation. They’ve switched to a real-time system, enabling customers to see immediate deposits and avoid the traditional 2-day posting lag. In addition, their acquisition of Simple was a smart move in terms of providing users with a better digital experience. I look forward to what comes from that acquisition.

On Fintech
I predict that we’ll see some big things from PayPal. Now that they are no longer part of eBay they’re positioned to fulfill the vision that Elon Musk originally had for X.com in terms of becoming a full-fledged digital bank. Square is also well positioned to be a big player, as evidenced by their expansion to small business lending earlier this year. Once these fintech companies perfect additional processes such as mortgage loan origination, the big banks will have tremendous cause to worry. It’s only a matter of time.

 

As MX continues to innovate, what are your thoughts about the millennial generation and how to engage them?

I agree with Ron Shevlin when he says that the need to appeal to millennials is overstated. If banks and fintech companies focus on improving convenience, they will automatically attract millennials as well as baby boomers and retirees too. Everyone wants convenience.

 

What are financial service providers doing to engage millennials? What are they doing right and wrong?

Banks and credit unions make a big mistake whenever they try to appeal to millennials with juvenile marketing. For example, adding a childish component to a banking app or using the latest social media hashtag isn’t appealing. Financial institutions should instead do what they are best at — offer legitimately useful financial advice. Older millennials are now in their early 30’s, and they are not looking for something childish. They want a more convenient experience and they want genuinely helpful guidance. That’s it.

 

What are some of the innovative things at MX you’re excited about right now?

We just launched WideNet, which allows a financial institution to offer a money management app to potential account holders. Consumers can download the app and start conveniently managing their money, even though they’ve never interacted with the institution before.

Once a potential account holder begins using the app, the financial institution can upsell within the app for services and products that are directly suited for the user’s needs. In addition, if a user wants full access to transfer money using the app, they’ll be prompted to sign up for a bank account with that institution. It’s the most convenient way I know of for someone to start a relationship with an institution.

 

Most of the cash deposited is covered by the top banks and that is shrinking. Where do you think the industry is moving?

I don’t think the big banks should get too cozy. When PayPal or Square or some other fintech provider acquires a banking license and offers an entire range of banking products along with their improved user experience, there’s going to be a huge fallout, and big banks will be in trouble.

The change will happen slowly and then all at once, the way the booming growth of Instagram and Slack seemed to happen over night. To be clear, it is far more difficult to scale quickly in the banking industry, with all of its tangled regulations, but once a Square or PayPal jumps over the remaining hurdles, I can see customers moving en masse to support the convenient full digital banking experience they will offer.

Even though tech has helped us on the convenience side, do you think it has helped us holistically? Consumer debt is at an all time high and people are delaying their retirement by 10+ years because they have not saved enough. Is there a correlation?

I don’t know if there is a strong correlation, but I do believe technology can make this problem better. I also believe that including a human component is crucial. Digital is important, but it is not all we need. It’s going to come down to companies like MX and Levanto that merge human instruction with a digital tool to help people manage their personal finances.

 

 

How Sudden Wealth Syndrome May Be Causing You To Make Poor Financial Choices

Congratulations! You might have just won the lottery, inherited a fortune, or received a large settlement in a lawsuit. Whatever the case, you have just become rich in a short amount of time. So why are you struggling so much? Suddenly coming into wealth should have solved all of your problems!

Whatever your profile, such a quick shift in social status and financial opportunity can create a tense situation for anybody, and ­­even more so for couples who come into money together. What you’re experiencing is called Sudden Wealth Syndrome. 

Do you have any of these symptoms? Excessive temptations, feelings of guilt, isolation from peers, or an inexplicable fear of losing everything? If you said yes to even one of these symptoms, be careful! These manifestations may spell trouble for your financial future.

Let’s take a look at some of the problems that arise with sudden wealth and look at possible solutions for handling them quickly and efficiently.

Excessive Temptations

You used to live hand to mouth. However, this new sense of financial freedom has awakened temptations in you that you didn’t even know you had. You never used to spend a penny unless it was necessary. Now, there is a desire to splurge. Before you know it, large sums of money have quickly vanished and you’re left wondering how.

Solution: First off, don’t be discouraged. After all, you have the right to enjoy your success to some extent! But, learn to recognize where good splurging ends and harmful indulgence begins. Unfortunately, when most people are left to their own devices, this is a problem likely to have an unhappy end. To come up with smart ways to stay financially in control, consult a third party expert who can help you find the balance that fits your lifestyle and net worth.

Feelings of Guilt

Is it hard to look around and see others in need? It’s common for the suddenly wealthy to be overwhelmed by feelings of guilt, especially when they see their friends and family still struggling to get by. Naturally, one’s instinct is to spread the wealth as a means of absolving these negative emotions. Now, there’s no reasonable way to dismiss generosity as a virtue. However, there are better ways to give and contribute to the lives of the less well­ off, and there are ways that are more self­ destructive and should be avoided.

Solution: Your friends and family don’t have to suffer, but before you give away a single dollar, consider outlining a “sharing plan.” This is a structured approach to maximizing your sharing potential and assure that you will be able to remain generous to causes that matter to you for many years to come. It includes gathering expert advice regarding matters of tax benefits, budgeting, and even managing personal relationships better.

Isolation from Peers

Two bad trends seem to take shape among the recently endowed: 1) the temptation to flaunt new toys and other signs of having made it in front of old peers (those less well­ off), and 2) the pressure to show off wealth as a means of fitting in with new social groups (those equally or more well­ off). Needless to say, both tendencies are most likely to have inverse consequences and lead to social isolation.

Solution: Despite the increasing wealth gap in today’s society, there is actually evidence that cultural divisions of social classes (excluding the ultra rich) are disappearing. Neighborhood segregation may always exist, but not all your peers from either side of the spectrum are going to want to include themselves in all aspects of your social life. Still, the best way to keep your social life in tact following an influx of funds is to proceed as normal with carefully agreed upon upgrades. These upgrades should equate to real improvements in the quality of life and not just serve to impress.

Fear of Losing Everything

Your whole life, you never imagined that someday you’d have what you always dreamed of: extra money. Now that you finally have it, you can’t bear the thought of squandering it with bad decisions. First, congratulations on being conscientious of wealth management. However, money that doesn’t move doesn’t grow, and money that doesn’t get spent is mere paper in your pocket.

Solution: Don’t be afraid to let go a little. There are many safe ways to invest! When the principles of portfolio diversification are followed, there’s an extremely small chance that you’ll lose it all. Whatever your intentions are for your wealth, whether it be to enjoy it, share it, grow it, or put it to work, one thing’s for sure: fear is only going to hold you back from economic opportunity. 

If you don’t think you can trust yourself to make these decisions, consider a Levanto household CFO to help you find a happy balance.

These points only touch upon some of the pitfalls of Sudden Wealth Syndrome. Use them as a basic guideline for when you make the move to bring in a financial professional to help you in your affairs. In any case, keep in mind the simple truth that moderation, planning, and expert advice are your main keys in building a sustainable financial future.

Here is Why Everyone Needs A Household CFO

When was the last time you seriously looked at your household budget?

Was it six weeks ago? Six months ago? Or perhaps you’ve never put together a personal budget and are just “winging it”. Whatever your answer is, know that you are not alone.

According to a recent Gallup poll, only 33% of American families have a planned monthly budget.  And although that number may seem surprisingly low, the truth is that far too many people ignore their personal finances until it’s too late.

It’s natural to come up with excuses as to why you’re not managing your finances. For some, it’s the fear that it may be too complicated to comprehend. For others, it’s lack of time and understanding.

Sometimes all you need is a person who is available to help guide you through the process.

Major corporations have spend management platforms that allow the company to keep track of finances. These platforms always have positive effects to a company’s bottom line. Levanto applies that same technology and management to our client’s personal finances.

The Levanto Difference

Here at Levanto, we try to help normal people through their financial planning and budgeting. Our dedicated Household CFOs work with our clients every day and focus on helping them achieve their financial visions through monthly budgeting, billpay, and more.

“Emotionally, it can be a challenge for many of our clients to approach us. But once they do, they are immediately grateful and on a better financial path.” explains Victor Claudio, Levanto’s Head of Client Service.

“It requires a realization that you need help with your financial situation. Maybe it’s due to an increasing debt load or time constraints for handling your budget. And because finances can be an emotional thing, we pride ourselves on building rapport with our clients based on empathy.”

The Personal Touch

For Levanto, the relationship building begins during your first meeting. During that time, your dedicated Household CFO will ask detailed questions to better understand your needs as well as your current financial situation.  

Our team then drafts a detailed economic roadmap. This helps us identify potential cash-flow issues.

The Levanto differentiator is helping our clients look at future obligations versus current finances, helping people get a good idea of how to plan for their future. Expenses such as sending a child to college or caring for an elderly parent are often expenses that are overlooked during financial planning.

“Our clients love the personalized budget we create for them, and the fact that we help them monitor their day-to-day expenses. They can also consult with their Household CFO anytime they anticipate major life changes or have questions. Every month, we also deliver comprehensive reports to track your progress.” says Victor.

“It’s a different approach to personal finance, but it’s based on the simple idea that if more people were proactive in their financial decisions, it would eliminate a lot of future financial problems.”

Like Having Your Own Household CFO

Richard Klein is a long-time Levanto client and appreciates the personal touch. He’s been singing the company’s praises for the past five years.

“I began using Levanto after a friend recommended them. I was interested in getting help in managing my bills and decided to check them out.”

After the initial budget planning session, Richard was surprised to see how his money was actually spent every month. He says sticking to a budget can prove to be tricky at times, but relishes in the peace of mind Levanto brings to him.

“The most rewarding part of having Levanto is not having to worry about paying my bills because they do it for me,” Klein explains happily. “Levanto had me set up two accounts. One account is strictly bill pay and they handle the details. The second account is designed for other expenditures, like buying groceries.”

“Victor has been awesome. Very responsive and helpful. If I need insurance on a new car, they’ll take care of it for me. It’s like having my own CFO.”

Today, Richard is one of Levanto’s biggest evangelists and lets others know about the benefits of using Levanto.

“Even if you don’t sign up for Levanto’s monthly management services, taking part in the initial budget meeting can be a rewarding experience and one that will put you well on your way to great fiscal health.”

“I always say that good personal finances is like a muscle,” concluded Klein with a laugh. “so you have to exercise it once in awhile for it to be healthy.”

How to Work with Us

We offer a budget consultation to evaluate your expenses, and provide monthly services with a Household CFO to help you manage things day to day. If you’re interested, contact us today!

Winning: Are Your Fitness Goals Beating Out Your Financial Goals?

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Just as your personal trainer will take the time to understand your lifestyle, workout habits, and fitness goals, your household CFO will take the time to understand your situation, your relationship with money, and your saving and lifestyle objectives.

Just what is a household CFO?

Simply put, a household CFO is your personal finance concierge, and if needed, your financial coach. This is the person who will help you quickly get control of your financial goals, just as your personal fitness coach will help you reach your fitness goals. Obtaining this level of accountability with an objective partner is a great opportunity to get a reality-check and and achieve results you couldn’t reach on your own. 

The fact you may want to run a marathon next month may not be realistic, depending on your current fitness level, workout schedule, and eating habits. With the help of a personal fitness trainer, you’ll have a better chance of placing higher than you would otherwise. Similarly, if you want to begin saving for your 16-year old child's college education today, this may not be an attainable goal based on your current financial plan.

Your household CFO will pull the data together in a meaningful format  and analyze your spending and saving habits in order to turn your primary goal into a reality. This level of commitment and accountability will improve your financial fitness goals just as a personal trainer will improve your physical fitness goals. 

Like many, you may have a retirement goal that will allow you plenty of time to check off all of those bucket list items while you’re still young enough to enjoy them. You may be just a few years into saving for retirement or 10 years away from your goal date.

At the same time, you’re likely saving for your children’s college educations, and possibly even helping your parents out financially. Proper planning for these goals requires organization and diligence, and most of us need at least a little expert assistance with the process, and a lot of assistance with the execution!. Having a  personal CFO to guide you can increase your savings by 113% per year.

Where is all the money going?

Your savings timeline for future goals is just one side of the coin. You may have heard that money issues are a leading cause of stress in relationships and divorce. Personal finances, budgeting, debt, investing, saving – these are emotional topics. An objective third party can help dissipate the stress of these conversations by helping your family create transparency around emotional financial decisions and stick to a plan. Whether it’s the daily trip to Starbucks or the dream vacation to Bora Bora, your household CFO will help you create an annual spending plan that outlines exactly where your money goes, and this process reduces credit card debt by an average of 34% in the first year.

Yet another stress-saver your household CFO can offer is handling the universally dreaded task of bill-paying. Most families are so busy these days between work, children’s activities, hobbies, fitness and the like, and paying the bills is often the household chore nobody wants. Your household CFO can take over this task, saving you not only valuable time, but interest and late fees as well. They’ll also find ways to decrease your monthly bills by researching lower-cost alternatives. In addition to improving your savings rate, paying your bills, and attacking debt this service can also improve your credit score by 10% in the first year.

Your personal CFO will help you to prioritize your goals, define the steps needed to reach those goals, and regularly review progress toward attaining those goals. They will encourage you to get organized by helping you gather all of your financial documents together before they begin providing services. Future planning & review meetings, will then have an agenda with a list of clearly defined goals. Like a personal trainer will keep you focused on your marathon goals, your personal CFO will help you follow through on your financial commitments.

Ready to take control of your financial life?

Levanto Financial is a next-generation personal financial planner for sophisticated consumers. Our household CFO services combine cutting-edge technology with a trusted personal relationship, helping clients save money, time, and relationships. Our typical client saves $12K and 180 hours per year. To arrange your free phone consultation, call 1-844-LEVANTO (1-844-538-2686) or contact us here.

5 Things You Can Do To Save Money Now

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What if you were debt-free? What if you had enough savings to create long-term wealth? I’m sure you would be very happy with that situation, but it takes a little work to get there.

Saving money and creating wealth is a crucial part of financial stability.  With a safety net, you can buy a house, be prepared for emergencies, or take that vacation you’ve always dreamed of.  Many people are at different phases of the savings continuum, eager to be financially secure.  Here are five simple ways that you can start saving and get on the road to financial freedom!

1.     Make sure that you have the best credit cards for your spending habits.  
There are many different credit cards out there and the choices can be overwhelming. Credit cards vary in interest rates, annual fees, and benefits. If you travel a lot, you’ll find ones that provide you with more rewards or cash back for spending money on travel. If you pay the minimum each month, you’ll want to focus on getting the lowest interest rate possible. In the long run, it makes sense to do the research upfront and find the best product for you.

2.     Set reminders to pay your bills on time.  
Every single late fee that you pay takes money out of what you could be saving. From credit cards to rent, your recurring bills all come with some sort of late fee and penalize you if you don’t pay them on time. These late fees add up and you want to avoid them at all costs! Protip: if you regularly pay your bills on time and are late only once, it’s worth giving the company a call to see if they will waive the fee.

3.     Understand your spending and plan cashflow.  
Keep track of what you spend from month to month and take a close look at where your money is going. Once you understand what you spend your money on, it’s easier to create a budget and see if you can cut back on anything. Be sure to stick to your budget once a plan is in place. Mint.com is very useful for understanding your spending habits and helping you stick to your budget.

4.     Routinely restructure consumer debt so you can eliminate it faster.  
Rates change and new offers are introduced often in the world of finance. It makes sense to take a quick look every six months or so to see if there are better offers out there for your mortgage, credit cards, etc. Whether it makes sense to take out a debt consolidation loan to pay a few debts off and have a singular payment monthly or restructure your credit cards, you should take the time to do so as it could save you a significant amount of money.

5.     Set savings goals and track your progress.  
First, figure out what you’d like to start saving for. It could be a wedding, retirement, a safety net, or your kids’ college education. When you have a goal you’re saving for, it can be a motivating factor that makes all the difference. Next, decide how much you need to save and when you need to have this money by. This will determine how much you should save every month. As you start saving, keep track of your progress until you reach your goal!

With these quick tips, you’re all set to start, or reinvigorate, your path to saving success. It will take some time and effort, but it’s all worth it!

If you don’t have time to do this yourself, Levanto has you covered. For an affordable monthly fee, we provide you with your own Household CFO who will build your custom budgets, help manage your cash flow, and even pay your bills if needed! Getting Levanto in your court is only a few clicks away and clients are guaranteed to perform better by saving time, money, and feeling more in control.

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