SaveMe is a mobile app targeted for young adults to help them set savings goals and easily attain them. The idea is to provide the user with savings opportunities frequently and easily by decreasing the ability needed to save, maximizing motivation, and providing timely nudges. The user links their bank account to the app, and every time a payment is received by their account, they get a SaveMe push notification. Payments can include large-scale payments like biweekly paychecks, or small-scale like account transfers or Venmo deposits. The push notification appears on the user’s lock screen, where they are informed of the amount of payment received and are provided with 4 options for saving. They can save 0, 5, 10, or 15% of the given payment, all with the touch of a button from the lock screen, taking virtually no effort at all. Each savings option comes with a small icon comparing the savings to some tangible real-world sacrifice being made. It essentially asks the user, “Would you sacrifice a cup of coffee or a candy bar to save extra for your future?” By framing the savings as a small sacrifice, the user feels very little effect on their short-term financial standing, which we believe is a main desire in this challenge.
In the actual app, the user inputs their age and sets their savings goal. For instance, they can set a goal to save up for a vacation or a car in 10 years, providing a prize that the user can set their eyes on. This makes saving provide a tangible end goal with real-world results, rather than some arbitrary savings goal. Also within the app, the user can see their current savings, their initial goal, their projected savings, and an interactive slider that allows them to see a timeline of what pace their savings are on. This lets them understand both short-term (1-5 years) and long-term (25-40 years) benefits of saving by providing future projections. With this approach to savings, SaveMe truly makes saving a constant yet pain-free process. The biggest challenges of maintaining a saving habit are remembering to save and making today’s money worth putting off, and SaveMe tackles these with constant savings opportunities with little current-day impact.
So how does SaveMe actually benefit as a company? SaveMe would operate using the concept of “Market Arbitrage”. The concept is that you can take advantage of discrepancies between the price of the same security on two different markets by buying one and selling the other, taking the difference as profit. SaveMe utilizes small portions of its user’s savings that are sitting in the bank to complete these transactions. However, at the moment that the user requests their savings, they receive all requested money instantly (no worries of losing your money). Any negative transactions are covered by SaveMe, and a portion of positive transactions is added to the users savings total, allowing savings to increase faster than if it were just sitting in the account. This incentivizes users to keep using the app, since it will provided better savings returns than a traditional bank savings account. The rest of the profits go to the SaveMe company, allowing us to thrive and further explore savings opportunities.
Sources:
http://www.investopedia.com/terms/m/marketarbitrage.asp
http://www.huffingtonpost.com/2014/03/13/median-home-price-2014_n_4957604.html
