Give it a nudge

We all need a little nudge.

It could be a sticky note reminding you to call the plumber about a tiny leak, or a fruit bowl near your desk so you can eat an apple instead of a Yorkie. These “nudges”, as subtle as they are, can prevent a leak from turning into a flood, or a poor diet leading to bad health.

For most decisions, we know the right course of action, but often decide not to take it. A fruit is always more sensible than a Yorkie, but c’mon, who doesn’t love a Yorkie. We should be skipping pints at the pub and re-invest our savings into a pension that will unlock in 2047. But seriously, who does that?

This is why behavioural economics has struck a chord with so many in recent years. Whilst traditional economists label humans as entirely rational beings, behavioural economists acknowledge that we are imperfect and irrational (and that’s okay).

More specifically, we’re hooked on nudge theory, an area of behavioural economics proposing that positive reinforcements and indirect suggestions can promote better decision making. Nudge theory is central to our product development because we keep hearing - time and time again- that people are knowingly making the wrong financial decisions. 

We’re confident that by incorporating “nudges” across our user experience, we can steer people in the right direction when they stray off course.

So, how will nudge theory play out in our user experience? Here’s a sneak peak:


1) Allocate your money towards a new goal (without thinking too much)

Once you’ve successfully reached an investment goal, you can allocate that amount towards a new goal that you’ve been neglecting. For example, if you’ve reached your first home deposit goal, our chatbot will nudge you to invest that same amount towards a pension (and make it easy to do so).

2) Handed on a silver platter

If you’re investing towards a first-home, our plan will include a Lifetime ISA so you can make the most of government incentives for first time buyers. By automatically integrating these perks into your investment plan, the benefits are handed to you and waiting to be reaped. You can always opt out if you want to…

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3) Pats and pinches

Investing often deters people in need of short-term gratification. With our personalised updates, you’ll get a pat on the back if you’re progressing towards an important goal. With positive reminders, you’re more likely to stay on the right path. And if you’re not making any progress, a gentle pinch may be just what you need.

This is just a peak into our wider ambitions to make investing simpler and more fitting to the needs of the smartphone generation. Like many behavioural economists, we relish the opportunity to build something that empowers real people- quirks and all- to be smarter about their money.

Note: For those that are interested in nudge theory and behavioural economics, we encourage you to read some of Richard Thaler’s work. Thaler was the 2017 recipient of the Nobel Memorial Prize in Economics for "incorporating psychologically realistic assumptions into analyses of economic decision-making".