Cassandra Report Digest: Gen Y Seeks Alternative Fiscal Tools

Research and insights from the latest Cassandra Report

The latest issue of the Cassandra Report: Ages & Stages reveals that Gen Y is frustrated with the outdated nature of most financial systems. Nearly six in 10 (58%) think big banks aren’t designed to serve their generation. As traditional financial institutions fail to address them in relevant ways, they’re looking outside of established brands to find services and tools that cater to their unique fiscal and generational mindsets.


Marketers and media outlets often assume that Ys don’t have money, but they actually do: they just don’t always know the best ways to manage or grow it. More than half (52%) are not actively planning for their financial future, largely because they don’t know where to start. It’s not that they distrust big banks, but rather, they feel alienated by them. Startup Digit is one of the companies that better serves them; it helps people make smarter, automated savings decisions by connecting to users’ bank accounts, assessing their income and spending habits, and gradually funneling money into their savings accounts if they can afford it.


One-third of Ys say it’s hard to know how to plan for their financial future. Swedish company Qapital makes it easier by helping them save up for big-ticket items, including material goods, experiences, bills, and debts. The company’s IFTT (If This Then That) feature speaks to Ys’ penchant for gamification by letting them set up specific savings triggers that put money toward savings goals every time they perform a particular action, such as walk a certain number of steps or buy a coffee. The service seeks to make saving more fun, while helping users pay more attention to what they’re spending their money on.


As digital natives, it’s no surprise that the majority of Ys (56%) would rather have financial information available to them digitally then have to talk to a financial planner. Online financial services startup Wealthfront meets this preference, providing an automated investment service that uses algorithms to pick a portfolio of funds. The company is aimed at the next generation of investors as it requires just $500 as the minimum investment to open an account, and charges much lower management fees than do conventional brokers. It also emphasizes transparency and accessibility, allowing clients to see all their fees, transactions, and account activity through a sophisticated mobile app.