Pokémon Go to the bank

O'Brien-ShaneIn what has already been deemed the most popular mobile video game of all time, Pokémon Go perfectly illustrates the power of mobile devices in today’s world. The game, released on July 6, has been downloaded over 15 million times and is being used an average of 43 minutes per day on Android devices. In fact the game itself added $8.2 billion to Nintendo’s market value in just five days following its release, so to say that it has gone viral would be a severe understatement. The object of the game is simple: “Catch ‘em all.” The game uses an overlay of Google Maps to track your movement and, as you walk around town, different fictional animals appear on your device. You, the player, try to catch them.

You may be asking yourself, “What does this have to do with the price of tea in China?” Or to be more accurate, “What does this have to do with 401(k) recordkeeping?” Short of creating a similar augmented reality app that requires participants to check their 401(k) balances or enter beneficiaries in order to catch one of the aforementioned creatures, there isn’t an obvious correlation. It all boils down to the underlying principle of gamification, which refers to the ability to use elements of game-playing, including video games, to influence human behavior. The application of this can be seen across many platforms and service providers from fitness trackers to education. In education, certain devices and games can be used to increase engagement in the classroom and help with long-term retention, which is due to the chemical dopamine being released in the students’ brains as they play. Just as gamifying the classroom can have a profound effect on learning, so too can it help employees reach their financial goals.

Money magazine points out that much of how we handle personal finances is already set up like a game, such as earning credit card points or boosting a credit score. This same principle could be applied to preparing employees for retirement, either by gamifying employee training with augmented reality devices that employ similar technology to that of Pokémon Go, or by leveraging mobile apps that give rewards to participants who use them. I’m not suggesting that if companies simply place fantastic, imaginative creatures into their employee benefits platforms, all of their employees’ financial problems will be solved. Rather, I believe it is a way to shift the paradigm of planning for retirement and increase preparedness across multiple generations. A recent study by Employee Benefit Research Institute, an organization focused on providing research and education on employee benefits programs, found that 54% of workers surveyed reported having less than $25,000 saved or invested for retirement. If there is a way to gamify the recordkeeping and administration of employee benefit plans, shouldn’t we make every effort possible to do so in order to help our employees and our clients’ employees be better prepared? The smartphone and mobile gaming revolution has provided businesses with opportunities to do just that.

Take the mobile app SaveUp, for example, which encourages people to save money and pay down debt. It does this by rewarding each person with credits every time they deposit money into a savings account or make a payment on debt. Those credits can in turn be used to enter raffle-style drawings for different prizes every day. These drawings include a monthly $2 million jackpot and a weekly $500 drawing, among other prizes. According to SaveUp’s CEO, these initiatives have led to over $150 million being deposited into savings accounts or used to pay off debt since the company was founded in 2010. Another similar program, called Save to Win, was launched in credit unions throughout Michigan in 2009 and led to almost $9 million in savings that year alone. These extrinsic reward programs encourage positive financial behaviors and have proven to help people become more fiscally responsible as a result.

Gamification will no doubt continue to be a powerful tool, whether it’s used for stimulating young minds, engaging people in their finances, or helping employees prepare for retirement. If personal finance apps such as these can garner even a fraction of the popularity that Pokémon Go has, it stands to reason that we can make serious headway in paying down the trillions of dollars Americans currently owe in debt and save more toward retirement.