The Power of Community in Finance

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We know that money is highly personal. It isn’t a popular topic for a cocktail party. And for many, it is considered taboo to even discuss amongst friends and family. 

Perhaps this is why, when it comes to managing money, we see that most people are trying to go it alone. According to a CNBC study, 75% of those surveyed cited themselves as solely responsible for managing their money. 

Yet, at GBI, we believe it is not easy and maybe even impossible to manage finances completely on your own. 

Have you ever googled questions like when can I retire? How much house can I afford? How much should I be saving? 

Well, you wouldn’t be alone. Every day hundreds of thousands of people are searching for answers to questions just like this. In other words, they are looking for help from others in a more anonymous way.  

But Google can be an intimidating place, where a simple search for “How much should I be saving each year?” returns over 4 billion results.  

At GBI, we want to lower the barriers for people to get the help they need to successfully achieve their financial goals. We’ve tackled the questions of how do we remove the jargon and the hurdles that currently make it difficult for people to engage with financial problems?

In other words, how do we create a less intimidating forum for people to learn from each other but in an anonymous way?

Imitation within Communities

We’ve written in previous posts about the tools that we think are important for developing an innate, or tacit understanding of financial planning. These are strategies that we believe can be used together to make managing money more accessible to everyone. 

One of the critical components of this toolkit is imitation. Yes, you could learn about financial topics on your own through trial and error. However, trial and error takes time and can often be a costly approach. 

Instead, imitation allows you to tap into the collective wisdom of others for a starting point that you can then tailor to your specific needs. 

Think about learning to throw a baseball. You most likely learned, first and foremost, by imitating someone else. But you couldn’t just replicate exactly what they were doing. 

You were most likely a different height than whoever you were learning to throw a baseball from. If you copied them exactly, your throw would end up nowhere near where their throw did. Thus, you use their motion as a starting point and then tweak it so that it works for you. 

In fact, most people don’t only imitate a single person, but instead watch how a few different people throw a baseball. Then, take a little bit of what each person did and use that collective wisdom to develop their own throwing style. 

This example highlights how imitation works best in communities where you can learn by watching others. We believe this same concept applies in the finance world.

The Importance of Imitation in Financial Planning

In finance, a community creates the opportunity for people to learn how others are constructing plans to meet their goals. It creates a place where you can begin to answer those questions about how much to save, whether you’re on track, or even if you have the right set of financial goals. 

Just like throwing a baseball, you can get an idea of how different people may be approaching the same problems that you face. You can start by imitating those people and then tailoring your plans to work best for your situation and needs. 

A community can also provide a way to learn how others are seeking out and working with experts. 

At GBI, we think an important component of a community is observing how people share their plans with experts – financial advisors – and, in turn, how those experts add value to plans. 

Why? Well, we believe that getting access to advice that can help make financial plans successful is just as important as getting started. 

Lastly, we recognize that there is a need to keep financial information confidential. Thus, an effective financial community allows people to maintain anonymity while still sharing how they are building plans for and getting help with their financial goals. 

This is why we built the Lasso app – a social platform that not only allows people to anonymously match with experts who can help improve their financial plans, but also provides the opportunity for people to share with a community of other investors and learn from each other. 

Interested in becoming a part of the Lasso community? Sign up for early access to the app here.