With no clear plan in place to effectively manage their spending in retirement, many are forced to continue to stay in work for longer than they had anticipated, in order to build up sufficient funds to be able to retire. This, in turn, leaves companies with employees who can’t afford to retire and whose only motivation for staying in the workplace is purely a financial one.
Faced with such challenges, employers are now looking to increase their employees’ engagement with their financial situation and help them make informed choices. One way in which this is being achieved is through the use of gamification, a technique which involves applying elements of game design in non-game environments, such as financial planning. But how does this work in practice?
The use of gamification in financial planning solutions
Financial planning can be a complex subject and is often hard for many individuals to fully grasp. Many feel they lack sufficient knowledge, time and maths skills to independently make any financial decisions at all.
For example, if individuals fail to comprehend the pension options that are available to them, they could well end up making poor or ill-informed decisions which will have a direct impact on their future finances in retirement. It is therefore paramount that individuals are engaged with pensions and have the necessary understanding in order to take charge of saving for their retirement to ensure their financial security in old age. Online, interactive tools which are visually appealing and have a sense of momentum can attract those who might associate subjects such as pensions with dry, boring text and graphs.
Game playing techniques, such as point scoring or amassing rewards for completing tasks, aim to make it easier for consumers to understand complex financial planning processes and concepts. This not only helps to build motivation and confidence in making important financial decisions but also aims to alleviate any underlying anxieties the individual may be experiencing.
Successful financial planning solutions use gamification to exploit certain inherent stimuli that encourage many of us to try out an activity purely out of interest. Such solutions understand that individuals like to play games and like to win, often being highly motivated by the challenge of obtaining sufficient rewards to advance to the next level. In fact, research has shown that making use of strategies pioneered in popular games has proven to result in greater consumer engagement with financial issues on a continued basis.
|However, gamification is not solely about gaining rewards or progressing to the next level. At its core, gamification, when used in a financial planning context, is essentially about helping individuals to fully engage in their financial matters in a way which promotes understanding and encourages them into taking action.|
By featuring a number of gamification techniques, including progress charts and rewards, EValue’s Flexible Retirement Options solution, for example, provides an easily digestible, step by step process that aims to educate and embolden individuals, enabling them to build confidence in the options provided and the choices they make. Prominent visual graphics show the progress the consumer is making in exploring the tool thereby helping to instil confidence in their understanding of the subject matter resulting in a real sense of achievement.
Additionally, MI data from such solutions can be used to highlight areas that require attention and indicate financial issues that consumers are most interested in. This, in turn, can help shape future financial strategies and employee communication.
Skilfully incorporating apposite gamification techniques into financial planning solutions will not only trigger greater active participation but, through continued support of ongoing learning, will ultimately enhance consumer education and engagement in financial matters.