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Finance Apps Using Tough Love To Save Money


You will save money, and you will LIKE IT.

With all the new gadgets getting released recently, it’s certainly tempting to open up your wallet and give smartphone companies all your hard-earned cash. But one finance app is hoping to use tough love to help (or rather, force) you to save money, right here, right now.

Meet Cleo, an AI-powered “finance coach” that’s currently based in London. With over 30,000 users in the UK, Cleo is often described as “savage,” making sure to get straight to the point when users ask about the state of their personal finance. It neither shies away nor backs down from giving scathing replies to users, hoping to open their eyes and see the reality of their current situation.

Cleo isn’t alone in this goal. Surprisingly, there are plenty of other AI-powered chatbots whose sole aim is to help users manage their finances better.

There’s Charlie and Trim, chatbots who can cut out all your unnecessary subscriptions upon command. There’s also the chatbot Plum, who can help remind you to pay your bills on time, and if you give it permission, can also pay bills on your behalf. Another smart chatbot, Olivia, even introduces itself as “your personal finance assistant.”

According to financial psychologist Bradley Klontz, this method works through negative reinforcement. Chatbots are good at automating processes and offering hard-to-swallow advice that your friends may be a bit too shy to tell straight to your face, even though you badly need it. “The basic message is: your peers are doing this, you stink at doing this, do better.”

Personal finance expert Bethy Hardeman says, “The concept of roasting or shaming users is new and bold and out there — it’s being experimented with. But I think ultimately people respond much better to positive feedback and encouragement, especially when it comes to your finances.”

Klontz agrees with this line of thinking. “Ultimately, all the technology in the world isn’t going to compel someone to exert financial discipline to save unless they are fully invested.”