Spendology Launches Spendcast Web App That Gives Decision Power to the People

FOR IMMEDIATE RELEASE April 29, 2013

Spendology Launches Spendcast Web App That Gives Decision Power to the People

The purpose of Spendology™ is to empower people to make better financial decisions. This purpose is expressed in Spendology™’s motto: Decision Power to the People.

Spendology™ web apps use advanced analytics and psychology to help people make better financial decisions. The Budgetizer empowers customers to create a smart, local, and personal budget in less than 10 minutes. Spendcast™, the newest app, works with the Budgetizer to take planning and prioritizing to a new level by helping customers stick to their budgets while remaining flexible to life’s demands.

Spendcast™ will enable Spendology™ customers to:

  • Start planning ahead and stop overspending
  • Prioritize variable expenses
  • Plan to have fun and save money

A one-year subscription to Spendcast™ is $59; but, customers can experience it with a 31-day free trial.

Coming soon…Spendology™ gets mobile and social.

About

Spendology LLC is a software company based in Washington, D.C. focused on developing web apps that make budgeting super easy. Spendology was founded by Keith Alexander Ashe. Mr. Ashe is a graduate of Florida A&M University and Columbia University. He previously worked as a management consultant at Booz Allen Hamilton and the Corporate Executive Board. Keith Alexander Ashe belongs to the inaugural class of Bill & Melinda Gates Millennium Scholars.

Consumption Overload

Everyone’s a marketer nowadays. The game of Keeping up with the Joneses is a serious matter. We pressure each other and compete to see who has the latest and greatest tools, tech, and toys. As if this weren’t good enough, tech companies, social media in particular,  all want your time and attention. Why? Many social media companies are working for marketers and advertisers. They want your data so that they can sell you stuff. Moreover, companies hire teams of marketers to separate you from your money and lawyers to make sure that you can’t get it back (forced arbitration).

There’s nothing wrong with buying what you can afford. The challenge is that we don’t teach financial literacy. We also don’t show the important link between emotional intelligence and financial literacy. Marketers can take advantage of the fact that people are predictably irrational. Companies want you to keep buying. It’s about time that people had the tools to overcome irrationality and make better financial decisions.

Which Way is Up?

Richard Pryor is one of my favorite comedians of all time. He starred in a movie way back when called Which Way is Up? The film is about a working class family man who turns on all his loved ones and becomes extremely selfish, vindictive, and power-hungry. Pryor’s character mirrors the modern corporation.

Wall Street is Too Big to Fail, Too Big to Jail, Too Big to Understand and Too Big to Manage. We have bail outs, financial weapons of mass destruction, London whales, and implicit funding advantages from “Too Big to Fail”. Yet, for all the forgiven faults and advantages conferred to Wall Street, they have tragically failed to deliver for Main Street. The Dow Jones and corporate profits are hitting record highs,  worker wages are hitting an all-time low, and bailed out banks are using the funds to repay government bailouts rather than lending to small businesses.

Washington, DC is certainly not helping to protect consumers. Politicians have failed to appoint a director for the Consumer Financial Protection Bureau. President Obama attempted to make a recess appointment which was later overturned. Senate Republicans have blocked the nomination of Robert Cordray, the President’s selection, unless the White House weakens the power of the CFPB. Weakens? As if American consumers have too much protection.

America has lost her way when it comes to favoring corporations over citizens. Washington is not only unwilling to lift a finger to help citizens; they are complicit in scheming with business to advance their interests. George Carlin was right about the American Dream. However, things do not need to continue to move in this direction. People have the power to make a difference – we can encourage Society to focus on people rather than corporation interests.

The Spendology™ Edge

How is Spendology™ different from every other online money management website or app? Spendology™ leverages advanced analytics and psychology to make personal budgeting super easy. I would define innovation as improving the performance attribute of a capability by a factor of 10.  It can take 2-3 months of collecting expenses and hours of categorizing expenses to create a monthly budget. The Budgetizer helps users create a budget in less than 10 minutes.

Visual Anchoring Method

Anchoring is a form of cognitive bias. Individuals use anchoring when they assign too much weight to a certain piece of information when making a decision. However, Spendology™ uses anchoring to the benefit of customers, making data entry much easier.

Visual Anchoring Snapshot

Visual Anchoring Snapshot

Smart, Local, and Personal

Spendology™ leverages advanced analytics, location-based cost estimates, and the personal habits of customers to calculate a monthly budget. We crunched the numbers so you don’t have to.  Spendology™’s market research into the cost profiles and drivers enables customers to create smart budgets. Zip codes are used to create location-based cost estimates that reflect gas prices, cost of living and sales and use taxes. Personal habits such as giving gifts, going to concerts, shopping, and personal grooming are incorporated into the monthly budget estimate.

Fixed vs. Variable Spend

Spendology™ breaks down a customers expenses into fixed and variable spending. Fixed spending is considered an expense that varies less than plus or minus 10%. Fixed expenses would be rent/mortgage, cell phone bills, installment loan payments, etc. Variable expenses can change more than plus or minus 10%. Variable expenses would include groceries, dining out, entertainment, shopping, etc.

The Spendology™ Edge comes from leveraging advanced analytics and psychology to empower people to make better decisions. As we launch new products and features, Spendology™ will continue to be dedicated to empowering customers by making personal budgeting super easy.

Fire From Mount Olympus

In Greek mythology, Prometheus was a Titan whose name meant “forethought”. Prometheus stole fire from the gods of Olympus and delivered the gift to humankind.  I previously worked as a management consultant where I developed and tended fires, also known as decision support tools, for senior leaders in the public and private sector. Senior leaders used these decision support tools to manage resources and maximize return on investment. These tools were tremendously helpful to executive decisions makers. I asked myself:  ”what if people had similar tools that gave them more decision power?”  It was this line of thinking that eventually led me to start Spendology.

The Best and the Brightest

I was at a networking event recently where I struck up a conversation with a banker. The topics of too big to fail and too big to jail came up. Mr. Banker mentioned that said policies might encourage moral hazard but they were important because we should not discourage our best and our brightest to become bankers. I could not disagree more. Our best and brightest should be teachers, scientists, engineers, doctors, plumbers, construction workers, electricians, and government employees. Banking should be boring. Ultimately, bankers should provide capital to growing businesses and loans to consumers who can repay them.

 

Nick Chirls wrote a blog post that hit the front page of Hacker News entitled, My Time at Lehman. He worked in sales & trading at Lehman Brothers before the big crash. He detailed his experience working with rocket scientists, PhDs, and other really smart people. They created, priced, and sold financial weapons of mass destruction to the highest bidder with the lowest information. Ultimately, these very smart people figured out the best way to separate people from their money. Society would be much better of if these folks were working to map the human brain or cure cancer. Rocket scientists used to build rockets, now they build opaque, overpriced, and complex financial instruments that are pitched to gullible people with a lot of (your) money.

Parents Just Don’t Understand

Let’s say Junior moved back home after graduating from college and found a job at a local coffee shop. Junior and some of his fellow college grads may be stuck working low-paying jobs. Pew Charitable Trusts studied the issue of recent high school and college grads finding employment at a college level role. Only 60% of working college grads have a job that require college-level skills. The numbers are worse for high school diploma and associate degree-holders. Who is responsible for this situation? Perhaps it’s their parents’ fault.

Ultimately, the parents of Generation Y are the people running America. They work, pay taxes, save, consume, own, and vote. At the height of the financial crisis, many of these folks were impacted while some remained at their jobs. Parents are the HR directors and managers and middle managers who decided that the new Financial Analyst job required a Master’s degree and 5 – 8 years experience rather than a Bachelor’s degree and 0 – 2 years experience. The directive could have come down from Corporate. The CEO might have demanded these changes. The data show that Mom and Dad complied and didn’t successfully push back.

Parents of Gen Y have had ample opportunity to vote. Wall Street , Washington, and Main Street have railed about the size of Government. There is an intense focus to reduce the Debt by reducing investments in science, education, and the social safety net. The sales pitch is that we don’t want to pass on debt to our children. Instead, Very Smart People are telling us that we should pass on lower expectations to the next generation. Parents just don’t understand that their actions (or the lack thereof) created the economic and political malaise.