The iPhone Nanny

The WSJ ran an article entitled The New Money Apps over the weekend. I was iPhonehoping it would be about smartphone apps designed for the nouveaux riches. Something to help decorate McMansions or navigate country club admissions perhaps.

But it is even better than that. The article is about the burgeoning field of  personal finance in the form of bossy phone apps. No longer do those hapless consumers need to worry their little heads about how to spend and save. They can just do what their phone tells them.

Think of it as a really really sophisticated GPS system. Just enter “rich and happy” as the destination and follow the turn-by-turn directions.

Okay, I am exaggerating the current state of the technology a bit. For now, consumers need to be a little more specific about what the phone will nag them about. But the principle is there and the technology is not far behind.

HelloWallet asks users to flag purchases they regret. Using GPS technology, it tracks the locations of people using its applications on mobile phones and tablets. When a user enters, say, Brooks Brothers or Ann Taylor, the software can automatically retrieve his or her budget and past spending on clothes.

So it is kind of like having an incredulous nanny/accountant along on your trip to the mall. “Brooks Brothers again? Don’t you realize you’ve already spent $583.75 on clothes this month? And remember that stupid duck tie you got last spring? You never wear it.”

HelloWallet, who’s service is, they tell us “designed to be beautiful, simple, and smart” claims to provide “surprising and personalized advice.” That is redundant. Anything actually personalized would be a surprise.

And they have an endearing sense of mission. “We believe we can make the world a better place by being good people.” It was founded by an academic “to boost the wealth of workers by democratizing access to honest, high-quality financial guidance.” (Not consumers, you will note, but workers.) For every five paying memberships, HelloWallet gives away “a free membership to a family in need.”

The website even has an endorsement from Bill Clinton, well known for his personal finance acumen and self-control.

Assuming you are not one of their charity cases, HelloWallet will charge you $8.95 a month to help you “get ahead and live as full a life as possible.” That may or may not seem like a lot to you. Of course, a business/crusade like this has the problem that the people most willing and able to pay are the ones who need the service the least.

Thus HelloWallet’s effort to market itself as a benefit corporations can give their employees. The website lays out the mess that is consumer behavior and its ramifications.

For employers, this translates into a workforce that is not as productive, fails to retire on-time, struggles to embrace healthcare consumerism, and lacks the ability to optimize their Total Rewards.

Egads! A failure to embrace healthcare consumerism! That is almost as bad as using your Total Rewards sub-optimally. (Go ahead, follow the link.) Luckily, HelloWallet “obsessively focuses on solving employers’ core human capital financial management problems.” Not those peripheral human capital financial problems. Just the core ones.

But maybe HelloWallet does not go far enough, relying on mere nagging.

Another outfit founded by academics, stickK.com, does not yet have an app, but was mentioned in the WSJ piece. Their service is still a bit rudimentary, but the basic idea is to punish you with more than mere guilt for ignoring the personal finance nanny. They will fine you money. Well, almost.

How it works is that you set a goal, saving $100 a week perhaps, and a penalty you agree to pay in the case of failure. That could be a $20 payment to a friend or a charity. Even better, they suggest a donation to an “Anti-Charity” that is, a group you hate.

Sadly, they do not provide a list of suggested anti-charities. Maybe I could start one. I need something to do. The Texting While Driving Coalition? Perhaps the Save the Telemarketers Foundation? Oh wait, I know. The Walk FOR Hunger.

Obviously, stickK.com should just take the money themselves, solving the revenue model issues that are apparently challenging HelloWallet. And they really need an app. Once on your phone, all sorts of ways to punish you emerges.

Granted, I do not think the technology exists for a phone to give a user an electric shock when they misbehave. Maybe with iPhone 5. But it could text you snide remarks. Or delete key contacts. Or send humiliating messages to your old girlfriends. The possibilities are endless.

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