The brokerage developed the tool to help educate users about their debts and risks
Sydney-based Confidence Finance recently launched MoneyBRAINS, a free online tool that provides instant insight and analysis into one’s household finances and risk position.
As part of its mission to educate people on money matters, Confidence Finance engaged a web development team to help it create the new platform. MoneyBRAINS already has 500 users from the business’s existing database alone. It synthesises information such as where customers spend their money, if they’re under mortgage stress, how much they can borrow, and what will happen if interest rates change.
“Today’s marketplace is characterised by high levels of household debt, a stock of interest-only loans that are due to mature inside the next three years, and relatively poor levels of financial literacy standards,” Confidence Finance director Redom Syed told MPA.
“MoneyBRAINS is ‘robo-advice’ designed to help educate users about their debts and what level of risk their household’s finances are actually in.”
Easy to digest
MoneyBRAINS asks users — who can be customers, home buyers, or investors — 20 questions about their income, expenses and debt situation; then automatically evaluates those inputs to create insights.
By summarising all gathered information into an easy to digest “risk metric” that characterises households as “healthy”, “neutral”, or “at risk”, MoneyBRAINS is able to help users better plan for their future.
“Knowledge is power! Having access to instant information about household finances can really assist the decision-making and planning process,” Syed said.
One Confidence Finance customer, an “overleveraged” investor, realised his household’s actual risk level upon using MoneyBRAINS, and quickly shifted his focus on adding resilience to his household finances.
When Confidence Finance brokers provide advice now, they incorporate MoneyBRAINS into the conversation to give customers a more complete picture of their financial position rather than just their loan situation.
Housing crash? Unlikely
According to Syed, the data MoneyBRAINS has gathered supports the theory that any form of housing crash is “highly unlikely” to happen.
“While 30% of borrowers who have run the tool may not have access to refinance opportunities … in general, this segment of the population is well buffered to shocks and changes to their financial situation,” Syed said.
Confidence Finance will continue to develop MoneyBRAINS. The firm discovered that many people have questions about their finances and want to know more, but don’t always know where to go or feel comfortable asking.
MoneyBRAINS helps in that domain, according to Syed, because now people can ask those questions from the comfort of their lounge room.