BRIDGING THE FAMILY FINANCIAL WEALTH GAP
By Brett Foster, CEO, NestEgg
A critical trend with deep implications has been unfolding across the U.S. economic landscape: income inequality. The wealthiest one percent of households now hold over 90 percent of available wealth[1].
This is an alarming trend for young families pondering the future wellbeing of their children. From home ownership to education, the American Dream as we know it is feeling less and less accessible for the majority of families.
However, thanks to a slew of social-impact focused technologies aimed at opening the door to financial wellness, The American Dream just might be coming back into reach—albeit via a slightly updated version that’s digitized and accessed from a mobile phone instead of a bank office or investment franchise.
Technology: A Force for Financial Good
While much of the financial wealth disparity stems from regulatory and systemic imbalances, a rising wave of technological innovation presents a path forward for families worried about the financial futures of their children.
One of the greatest opportunities for technology as the great disruptor is in its huge potential to transform family financial wellness by making the power of compound interest and high-yield savings more accessible than ever before.
Today, a slew of social-impact entrepreneurs have created platforms designed to take away one of the biggest pain points of savings by making financial wellness actions frictionless, with options like rounding up change to go into a savings fund when you make a purchase and small recurring automatic transfers. For families on a budget, the power of starting early and saving regularly, even in small amounts, can reap enormous benefits later in life.
Some of these platforms actually give families 24/7 access to investments that were once exclusively the terrain of the ultra-wealthy, including tools like Morningstar, Robinhood, and LearnVest.
In the same vein as these and other digital disruptors, NestEgg, launching shortly, is designed to democratize access to protected, high-yield child trust funds – a key financial well-being tool for young families that’s no longer just for the wealthy. NestEgg allows any family member or other loved ones to quickly and easily create a flexible trust fund for as little as $3.95 a month and begin saving and investing toward a child’s future wellbeing (as opposed to the traditional model of working with a banker and/or attorney to create a trust with a standard $250,000 entry point) – giving them a significant advantage for college, business startup, travel, home ownership, or other life choices when they are grown. Trust funds are uniquely protected from creditors, legal action, the government, and other family members – making them the most secure and stable choice for long-term child savings.
NestEgg and other technology startups may be important mainstays for family financial wellness as society and the regulatory landscape struggle to adjust to a world in which the financial scales have been largely tipped in favor of those who are already wealthy. With technology leading the way, the scales may just even up a bit, delivering a brighter future for all.
About the Author
Brett Foster is CEO and co-founder of NestEgg, an app that allows parents on any budget to start a trust fund for their children in minutes, affordably and seamlessly. Brett comes from a background in financial technology, military intelligence and social impact advocacy.
