Smarter Savings with Fintech

• Tom Salzbrenner & James Dry
• Apr 12, 2022
• 7 min read

Saving is a challenge for Americans. In fact, nearly 70% of U.S. adults are worried they won’t have enough to retire, with 47% currently saving less than $200 a month, according to studies released by [CapitalOne] and [Discover], respectively. This has created a financial spiral with far-reaching effects. Many see America’s savings problem — a root cause of the financial spiral — as insurmountable.

But here at Ally, we believe small, simple solutions aimed at the right problem can lead to big progress. Driven by that simple premise to empower individuals on their financial journey, we set out to create a suite of financial tools to help all consumers on their financial journey — Ally’s smart savings tools program In fact, we were recently recognized by CIO Magazine for these innovations. Here, we’ll pull back the curtain and share how we brought these tools to life.

Our Journey Starts with Human-Centered Design

Ally’s design approach started with TM Studio, our concept testing and innovation team. To help consumers prepare for the unimaginable, we needed to identify their saving obstacles and develop practical ways of overcoming them. We began by asking consumers about their savings challenges, what they were saving for, how they approached their goals, and why they went astray.

We discovered a striking disconnect between people’s dreams and priorities and their money. Since an emotional connection between the two didn’t exist, there was no plan for saving or spending prioritization. The result: financial paralysis. A nudge for some was enough to push them to be proactive. Others needed help, reassurance, and a reminder that small steps could yield big results and help their progress.

Because of these insights, three absolutes became fundamental to the development of our smart savings tools program:

• Seeing is believing:

   

  When people visualize their savings goals, their motivation increases exponentially. Personalizing and categorizing savings like “Ryan’s college account” or “visiting mom this summer” enhances stickiness and makes an individual much more likely to set a priority and work toward it.

• Organization is optimization:

   

  Having a clean, easy path to getting started and the ability to see progress along the way is the motivation many need to start and keep saving. We wanted our tools to do for money what Marie Kondo does for homes: simplify.

• Automation works:

   

  There’s no doubt about it — when people use automation and remove the manual act of saving, they save more. But just as importantly, for those who didn’t know where to start, we needed to find a way to help.

The Digital Savings Solution

Since we’re a digital-native company with no bankers in physical branches, everything we do for our customers has to be accomplished in simple, powerful, and relevant digital experiences. Our main objective is always to build technology solutions that make our customers’ lives easier and empower them to be financially successful.

To meet those goals, we focus on being mobile native — meaning we design with a mobile experience first and then align our other channels to those feature and functionality standards. Research shows that Americans use mobile devices more often than desktops, and most individuals who are underbanked or unbanked manage their money through their mobile devices. Enabling someone to manage their financial journey — including saving for a first home, a new car, or retirement — from anywhere, at any time, and in a way that’s meaningful for them is at the core of what it means to be an Ally.

Enter Ally’s smart savings. These tools maximize savings and minimize time and effort by capitalizing on each savers’ unique priorities. We attack savings challenges using a two-part strategy called buckets and boosters. Through buckets, we help customers create a savings plan by organizing their money, so they know where they stand without having to do mental math. Boosters take those priorities and accelerate them on their journey. These tools were launched with rapid adoption and overwhelming positive customer feedback.

Shortly after, the Ally bucket goals tool was launched to provide customers with even greater control over their financial future. By setting a bucket goal, customers can choose a funding and timeframe target and monitor their progress. The front-end user interface is built using React and Ember to power a dynamic digital experience. It is API-driven and leverages real-time transactional data to provide a personalized experience. Additionally, it uses native mobile languages — Swift (iOS) and Kotlin (Android) — to optimize mobile app performance. Plus, its scalable system and user interface has been built to accommodate future iterations and enhancements.

Ally bucket goals promote savings strategies and encourage people to become personally invested in meeting their savings goals. They do this by providing them with the functionality — including customized prompts — to set up, track, and meet their financial goals. For example, based on where a customer is in their Ally bucket goal journey, they may be prompted to set up recurring transfers to optimize their savings habits. Additionally, with Ally bucket goals, we integrated an intelligent, personalized system into our customer-acclaimed buckets framework. By allowing customers to create custom goals with a target amount and date, we can now leverage technology — including real-time transaction data — to help our customers stay more effectively on top of and realize their dreams and financial objectives.

What We Learned Along the Way

We originally planned to launch Ally bucket goals along with the Ally boosters and buckets tools. However, as the team approached the go-live date, the Ally bucket goals feature was not fully built out. While we knew the functionality would be highly impactful and desired by customers, we decided to prioritize speed-to-market and provide the initial tools to support, empower, and validate consumer savings habits. Our ability to prioritize our customers’ needs and release minimum viable product sets while continuing to develop and refine our offerings is based on our design approach.

By using an industry-leading methodology to validate human-centric design and usability, our consumer research and usability teams were able to communicate the right customer experience for engineering teams to implement. Additionally, due to our flexible design and by routinely engaging directly with consumers, we continuously assess and refine the experience to meet customers’ needs. This is further enhanced by leveraging Agile incremental delivery practices. At Ally, we start with, speak to, and are guided by consumer aspirations. By ensuring we listened first and designing second, we were able to overcome our biggest challenges and create a meaningful product and experience for our customer. The results speak for themselves, with goals set up on a third of buckets and growing.

We’ve often had to fight the urge to try to solve every customer problem within one experience, knowing that this could result in a confused and frustrated customer. For Ally bucket goals, we used an industry-leading approach to concept testing and experience validation. Ultimately, the tool was successfully adopted because we listened to our customers and produced a straightforward solution designed around and by people. The experience adds real value to their financial health, and — equally important to us — it’s fun to use.

The Results

Our data shows that customers who use Ally’s smart savings tools program save twice as much as those who don’t. Customers created over two million buckets (and counting), and we’re encouraging users to contribute more to their individual savings by offering the Ally bucket goals tool. The most-used bucket names are for emergency funds, weddings, and Christmas — highlighting customers’ future savings intent. The most popular bucket is, in fact, our customizable one — showing that buckets and Ally bucket goals tools give people the ability to create a savings system that is as unique as they are.

Nearly 40% of customers that have joined Ally since the launch of our Ally smart savings tools program use Ally bucket goals. Additionally, as customers continue to contribute toward their financial priorities, nearly 75% of buckets with goals have both a target amount and target date. These statistics highlight how designing simple tools that address consumer needs help attract people interested in defining and tracking their financial goals. By choosing their own priorities, people are more likely to stick with their savings plan and contribute more.

While the primary objective of Ally bucket goals was to provide customers with additional tools to support their financial journey, we’ve seen other positive effects as well. Most notably, we’ve seen an increase in money movement towards the use of buckets, an increase in bucket account balances, and transfers into buckets. Much of this is due to both the product value-add and digital enablement — promoting the benefits of the tool, as well as making it easy to set up and move money around.

Solutions like our Ally bucket goals tool make it easy to access, organize and maximize money — making saving a seamless part of a consumer’s life. We didn’t set out to create a financial toolkit with a target return on investment. We create these types of products because we’re always striving to embody our mission to ‘Do It Right’ and be an ally, and we believe if we invest in individual financial health, the entire community benefits.