Why This Fintech For Couples Grabs My Attention
The hustle and bustle of the streets of New Delhi echoed throughout my hotel room when my partner, Anton, and I threw all our cash on the bed and spread it out.
We looked at each other, puzzled and sweaty. It’s May in India, so the 105-degree Fahrenheit heat is settling into our bodies. At that moment, as we stared at the jumble of rupees on the bed, it dawned on us that we didn’t have a conversation about how we would manage our finances while embarking on our grand adventure – 5 weeks abroad—three weeks in India, and two weeks in Europe.
Our financial journey was as much a part of our adventure as exploring ancient temples or wandering through the cobbled streets of European cities. Managing finances as a couple, especially in unfamiliar territories, required a new level of teamwork, understanding, and help with financial technology.
Our biggest issue was more transparency with each other and how we wanted to manage our finances abroad. Our story isn’t unique. In a world where financial independence and shared responsibilities often dance a delicate tango, couples face a crucial challenge: navigating the financial intricacies of their relationship. And it’s not just about romantic getaways; it’s about building a stable financial foundation that supports dreams, aspirations, and unexpected turns – together.
One fintech company on my radar that is directly addressing this issue – which is very common among couples, including the founders themselves – is called Plenty, a wealth management-focused fintech company giving a place for couples to manage, invest, and plan their financial futures.
This sounds like something that probably exists. But, surprisingly, I didn’t see some of Plenty’s competitors – the average digital bank with joint bank account options – provide the level of services that Plenty does.
Here’s the thing about today’s culture. Millennials are all about coupling up these days. 65% of us are in relationships, and 5 million are getting married this year. Living together without being married is also a growing trend among couples in the United States – the number has nearly tripled in the past two decades, with around 17 million adult unmarried partners.
We’re also all about living our best lives – which means that, unlike generations before us, a whopping 80% of us are in relationships where both partners are working. It’s a built-in independence that comes with two sources of income, but that doesn’t mean we don’t still want to do things together.
But the solutions out there for couples, unmarried or married, are basically joint accounts. A joint account could work, but what happens if the relationship ends? While it may be tempting to think a joint account is what couples need, it also seems like a general pain in the ass to split and manage a joint account when we have the technology to make things easier.
We don’t need to live in the world 20 years ago when the default was that couples fully joined and one person managed the finances. Couples need transparency together yet the privacy and independence to manage their own finances while planning for the future. This is what Plenty solves.
How It Works
Users can join as individuals or couples and make a minimal initial investment of $100 – a fraction of the usual amount required.
Users connect their financial accounts and then can choose which accounts to share with their partner and which to keep private while also using their financial planning tools to plan for future expenses like how much it costs to have a baby or save up for a wedding (this is key – it’s my favorite part of this platform)!
To make things even easier, Plenty offers a cash management product featuring a 4.83% annual percentage yield and an AI-powered direct indexing strategy that would typically require a $500,000 investment minimum. The yearly membership fee is either $150 for individuals or $200 for couples.
Plenty has caught the attention of notable investors like Phenomenal Ventures, Kevin Durant and Rich Kleiman’s 35V, former Wealthfront CEO Adam Nash, Xtripe Angels, and Inovia Capital – all of whom contributed to the company’s $2.75 million pre-seed capital.
Reducing Money Trauma
It’s no secret that money is the second leading cause of divorce. In that light, money transparency leads to less divorce, which, in turn, leads to less economic abuse of women.
Ultimately, this leads to greater financial independence for women and a population of fewer humans not marred by financial trauma.
It’s no wonder that the importance of financial transparency is growing in today’s economy.
Less financial trauma means happier humans running this world. And research shows couples who merge finances tend to be happier than those who do not.
Plus, if a couple talks about money at the very beginning of the relationship, it’s more predictive of relationship satisfaction and divorce than how much they discuss cash down the road. I really like Plenty’s behavioral finance-backed approach to this.
That’s because money talks point to a difference in values. If you don’t get those values at the front, it will only compound and become more of an issue over time.
This is when education comes into play. Two types of education are critical to incorporating behavioral finance into fintech products that Plenty addresses:
- Meta Knowledge: Effectively knowing what you don’t know. For example, I know I do not know how to build a fence. Knowing that means I will try and get help when I need a fence built instead of putting myself in danger.
- Just In Time Education: Intervention at the moment when it’s most direly needed.
There’s this massive gap between knowing what we ought to do and doing the right thing. That’s where behavioral finance and fintech come into play. It helps us overcome capacity constraints and ensures we are educated and ready at the point of a decision.
Plenty has its eyes set on the untapped potential of unmarried couples within the wealth management fintech realm. Will Plenty be the niche financial solution that lasts for couples? Only time will tell, but it sure looks promising, so I’m keeping my eyes peeled on this one.