Say you managed to teach a millennial to save, what now? Teach them how to start investing. Managed that too? Next step: make them get a retirement account.
“There is a big opportunity, and customers are asking for it,” Brandon Krieg, CEO and co-founder of mobile investing platform Stash, told Bank Innovation. “There are a lot of companies nowadays trying to leverage the technology and help customers with those kind of accounts,” but personal finance apps have an advantage: customer data and the possibility to move faster than most big FIs. “We grow with our customers, and saving is just the first step.” The startup plans to roll out its retirement product next year, Krieg said.
Just last week, Stash announced $25 million in Series B funding, adding to the $9.25 million in Series A round, which closed in August. The round will allow Stash to launch “several new” products, including the retirement account. “Our goal is to eventually build on our customer base and become a full-service financial services company,” Krieg added. Stash currently has more than 300,000 users since its launch last year, with 10,000 users joining each week.
It seems that supporting some kind of retirement accounts is on the agenda for many in the field. Robinhood’s website reads, “In the future, we hope to support joint, custodial, trust, and IRA account types.”
Automated digital wealth advisers, such as Hedgeable or Betterment, offer IRA accounts, and, in some cases, 401k retirement plans as well. However, as opposed to Stash (and other PFM apps), robos mostly do not allow customers to take full ownership of their portfolios, and offer automated investing options.