Pocketnest Fills Financial Wellness Gap at Credit Unions

Financial wellness platform featured in credit union fintech blog, Finopotamus

Financial wellness platform featured in credit union fintech blog, Finopotamus

This post was originally featured in Finopotamus.


By Roy Urrico Pocketnest, a Detroit-based financial wellness platform, continues to attract the attention of the tech community for its innovativeness, and credit unions and other financial institutions for its ability to provide data and insights to help financial wellness programs. Pocketnest licenses its white-label platform to financial institutions to enhance recruitment, retention, and productivity, generate qualified leads and boost cross-sell opportunities. Thus far, the firm has 35 enterprise partners including MSU Federal Credit Union ($6.93 billion, East Lansing, Mich.), Service Credit Union ($5.4 billion, Portsmouth, N.H.) and Community Financial Credit Union ($1.43 billion, Plymouth, Mich.), one of Pocketnest’s newest financial institution partners. The Michigan startup, which launched in 2019, also continues to add accolades from the tech community, as well; Pocketnest was a recent winner in the Wells Fargo Innovation Challenge. Previously, in December 2021, Pocketnest was among 11 other newbie companies to graduate in Google’s Startups Accelerator Program; in May 2022, IBM, in partnership with Endeavor, accepted Pocketnest into its artificial intelligence fast track program, an intensive three-month accelerator; and in July 2022, BECU, the largest not-for-profit credit union in Washington state, and CoMotion at the University of Washington (UW), announced Pocketnest among the winners of its fintech incubator competition. "Financial wellness is crucial to community health and future growth, and we're committed to being the partner to help make that happen," said Jessica Willis, founder and CEO at Pocketnest. Pocketnest is registered with the NCUA as a Credit Union Service Organization (CUSO) and with the SEC as a Registered Investment Advisor (RIA).



Help for Wealth Management


"My primary background is in the wealth management space,” said Willis, who noted she has always worked in the independent investment advisory world. However, she saw massive gap in the industry. “To get good independent investment advice, you need a significant amount of money.”


While acknowledging she loved serving her clients as their trusted advisor, she found peers, friends and family needing help with basic financial planning questions, such as: When do we need an estate plan? How much do we need in insurance? And how do you pay down your own student debt? How to save for college for your kids while trying to max out your own 401k?


“I saw people just super overwhelmed and I realized my friends are going to their credit unions, they are going to their banks, they are maybe going to mom and dad's advisor only to be turned away,” she said. “So, let us create technology that we license to those institutions to help them engage with my friends, my peers, their broader member base; and in the backend, identify cross sell opportunities and queue up those more appropriate leads.”



Credit unions are also recognizing the need for financial wellness help.


"Community Financial's purpose is to create joy and ignite Michinganders' impossible dreams. Pocketnest aims to elevate our communities' financial well-being by boosting their confidence in building those dreams," said Tansley Stearns, president and CEO, Community Financial Credit Union. "We are committed to vetting and offering simple-to-use yet insightful tools as we walk alongside our members in their unique financial journeys. Pocketnest fits the criteria for the type of future-ready technologies our members demand."



How Does The Platform Work?


Once Pocketnest licenses to a financial institution, it rebrands the platform to the organization’s nomenclature. For example, MSUFCU and Service Credit Union both use “Fin-Life powered by Pocketnest.” Said Willis, “We rebrand everything we can deploy inside their mobile banking apps, or we can deploy it as a free-standing app. Any financial products the financial institution (FI) sells we drop that right into our platform.”


From there Pocketnest engages with members, promotes financial wellness, deliver marketing assets and collateral. “We partner with the credit union. We talk to them at least once a month to give them new engagement assets to help the members log back in,” Willis explained.


While connecting with the member, the platform learns about each end user’s personal situation as well as behavioral tendencies and psychology. Willis explained Pocketnest takes users through calculators and assessments. “There are these little bite size inputs that we seek. We also have them link their accounts through Plaid. That gives us all the data that we need to give these customized recommendations along the way,” she added.


“We can share all that data back to the credit union or the financial institution through CRM (customer relationship management) integration or just by linking up to their data warehouse. Or we can send push reporting (‘here's everybody who needs a mortgage, here's everybody who has over a million dollars in assets for your wealth management group’),” Willis said.



Making a Difference


The Pocketnest financial wellness platform coaches users through 10 themes of financial wellness:


  1. Net worth snapshot.

  2. Budget.

  3. Investments.

  4. Estate and wills.

  5. Tax planning.

  6. College savings.

  7. Debt.

  8. Insurance.

  9. Retirement.

  10. Annual review.


Built on behavioral science and psychology, Pocketnest then develops custom-tailored financial plans and uses proprietary insights and predictions to keep people motivated and engaged in their finances.


On average, Willis said Pocketnest has increased users' financial wellness by 57% and has helped achieve 1,124 financial planning activities — and counting. She noted, “We spent two years building what we call ‘identifiable revenue.’ So, when we go to partner with a credit union, we have very detailed Excel spreadsheets that shows the product or the financial solution that the credit union might sell. Plus, we have a sense of what percentage of users need each of those solutions. And then we have a sense of how much revenue that can bring back to the FI.”


MSU Federal Credit Union, for example, attributed Pocketnest with identifying $1.2 billion in non-interest income potential and improving employee wellness by 55% in just the first month of using the platform. To date, 35% of MSU FCU members who use Pocketnest link their external accounts, giving MSUFCU further insight into their financial situations and a chance to better serve them.


Another facet of Pocketnest’s benefits is with employee wellness, which Willis describes as “a really interesting journey. One that sort of fell into our lap.” She pointed out while rolling out Pocketnest to customers, some administrators recognized they could roll out the platform to promote employee wellness as well. “So, this secondary product was born. Obviously, we are not bringing any data back to the employer except for engagement data. We are not dropping any products in the employee wellness product platform. We are just taking people through those 10 themes of financial wellness through the journey.”


Willis explained Pocketnest does not sell any product anywhere on its platform. “So, for any credit union offering wealth management services, we're going to say to the end user, ‘Hey, we understand you wanna talk to an advisor, click here to talk to Community Financials Wealth Management Group.’”


Ashleigh Craven, chief marketing officer for Pocketnest, said “We are not a launch it and leave it kind of platform or partner, for that matter. We work with the human resources (HR) department and also the marketing group, community engagement group to develop a marketing launch, onboarding and continued engagement plan.” This includes working with a credit union on developing a landing page, integrating its website, designing branch displays and website digital banners, and creating a mobile, online and banking experience. “We develop assets to help support the awareness and conversion and ongoing value or engagement with the platform.”


Added Craven, “We want to make sure that we are driving awareness, people are downloading (the app), we are converting, and then ultimately these members have access to financial wellness. We also want to make sure that we are bringing back that revenue and that ROI to our financial institution partners.”



Service Credit Union Brings Wellness Service to Members


Service Credit Union first implemented Pocketnest in May 2022. “Improving our members’ financial wellness is part of our mission, and we were looking for a partner that could help us achieve this in a fun and easy to use way,” Jaime Yates, community relations manager at Service credit union. “Pocketnest was created by and for Gen X, millennial and Gen Z users, and that is our target audience for this effort. Pocketnest provides insight as to where our members are interacting with the app, which helps us better tailor future content and initiatives.”


How does the Pocketnest solution help with advising Service Credit Union members? “The purpose of Fin-Life is to use behavioral science and psychology to coach users through various financial wellness topics (debt, insurance, retirement, tax planning, etc.) — from creating to sticking to a budget, to planning for the future — in just a few minutes a week.” Yates suggested by asking its users questions about their lifestyle and budget, the app customizes advice to help users meet their goals. “Users can also connect the app to their banking accounts for a full-picture view of their finances. The ultimate goal of Fin-Life is to put users in control of their finances and help them meet their financial goals, whether it is sticking to a budget or eliminating debt.”


Yates noted the credit union has realized other tangible results and benefits. “By working through the 10 themes of financial wellness, Service CU Fin-Life provides actionable to-dos to users based on their responses within the experience. These to-do’s help inform the user of what steps could be taken next to improve their overall financial wellness. That data is helpful to the credit union as well so we can ensure we are meeting our members where they are at, and providing them the resources they need, at the time they need them.”



This post was originally featured in Finopotamus.