Three-quarters of Americans are struggling with debt. Sixty-three (63) percent don’t have $500 in a savings account. More than 70% have less than $15,000 saved for retirement. Not to mention, healthcare-specific costs continue to rise.
A recent Gallup poll found that 25% of Americans say they or a family member delayed care for a serious medical condition in the past year—a record high since Gallup began tracking the question in 2001. In 2019, 36% of households with an annual income just under $40,000 reported delaying treatment, up 13 percentage points from the previous year. If current trends persist, the average American family will spend more than 50% of their income on healthcare by 2030.
Ilyce Glink, CEO of Best Money Moves, a tech-enabled financial wellness solution, has spent her career understanding how consumers manage their finances. We sat down with Glink to talk about the intersection of health insurance and financial wellbeing.
Q
How did Best Money Moves get its start, and what gap are you filling in the market?
A
I’ve spent my whole career as a financial journalist and syndicated columnist helping people make smarter financial decisions. I’ve written 14 books on topics related to money and real estate and was a radio talk show host for more than 20 years. In addition, I ran a content strategy and marketing company called Think Glink Media, which helped companies solve problems by using content to educate and nurture customers, clients, and employees. Working for companies like Countrywide Financial, Discover Card, Equifax, and Humana, among many others, helped me understand that financial services and healthcare companies have trouble explaining complicated concepts to their end users.
I realized that if you give people the right kind of information in a way that makes sense to them, they’ll make smart decisions. When I looked around at what was starting to be provided back in 2015 in the financial wellness space, I realized there was a gap between what information was being provided and what choices people were making for themselves. I thought bringing the power of the cloud and artificial intelligence in a way that was smart, fun, and thoughtful could help.
Back in 2015, people were really struggling to get over the Great Recession. Even today, in the greatest economy in more than a decade, 78% of Americans are living paycheck to paycheck, including 10% of people earning more than $100,000 per year. That’s a problem. And while a lot of point-based solutions have cropped up, we’re offering something customizable, personalized, and unique.
Q
Financial wellness is a well-established term in the benefits space and oftentimes involves driving employees to resources to improve financial “health,” like encouraging them to contribute to a 401(k). Sometimes those methods are not based on individual needs, though. Can you talk about how your platform markets solutions to employees, and how you interact with them on a regular basis?
A
I think 401(k) plans are great. I think everyone should contribute the maximum to their 401(k), or at least enough to get any match offered. But offering a 401(k) isn’t the same thing as offering a financial wellness program, because saving for retirement isn’t an employee’s biggest problem today—that’s in the future. Today, someone gets sick, and the employee can’t afford the health insurance deductible. Or, they have trouble making rent at the end of the month. Or, they can make rent and pay the electric bill, but can’t afford to feed their kids. That’s what living paycheck to paycheck looks like, and it’s happening in every company.
Best Money Moves asks questions to figure out what problem each specific employee is facing so we can help them address their pain point. We measure their level of financial stress across 15 categories. We engage employees with gamification, quizzes, and regular email interaction, and what we’re seeing is very high engagement rates and, more importantly, financial stress levels going down. Their credit scores go up. It’s really that simple.
Q
Besides encouraging employees to be financially well, can you speak to the role of the employer in engaging employees in wealth-related benefits?
A
Employers should want to give these types of benefits to their employees. It’s a low-cost solution to a high-cost problem—financially-stressed employees spend three to five work hours per week working on or worrying about their finances, so productivity suffers. Employees who are financially stressed are less engaged and more likely to suffer from alcoholism and drug addiction, take poorer care of themselves physically and have a higher rate of heart attacks, unexplained absences and workplace accidents.
All of these things have a high cost to employers; therefore, solving them offers a high rate of return.
Q
One of the biggest cost drivers in healthcare is inappropriate care. Understanding that clinical information is not the same as financial direction, do you think there’s any connection to be drawn between financial wellness and care coordination?
A
We believe there is a direct line between financial stress and healthcare costs and outcomes. As we expand our platform, we hope to offer ways for companies to measure this cost and find ways to reduce it.
Q
Where do you see the financial and insurance industries heading from here when it comes to sharing, accessing and analyzing data? How do you talk about data access and privacy with brokers and employers?
A
We take privacy extremely seriously. We know that if someone is worried their boss can see what’s happening with their finances, they’ll never use the program and won’t be able to reap all the benefits of all it offers. So, when we demo the product for a company’s employees, we show them what the employer can and can’t see. That seems to make everyone feel safe using the product.
Q
What’s the most important thing you’re working on right now?
A
We’re working on our AI contextual benefit support and maximization algorithm and look forward to rolling it out in 2020, as well as adding many more companies and employees to Best Money Moves. We’re also looking forward to launching Best Money Moves Connect for financial services companies next year as well.
