Gamification inspiring financial upliftment

blog-09-financial-upliftment

As you’ve probably noticed from my most recent blogs, I’ve been going through a bit of a personal wellness journey, using gamification to help me improve my overall health and fitness.

Looking back at my story, it occurred to me that if my personal gamified fitness plan could so easily scale up to a company-wide wellness program, maybe other important aspects of everyday life could be gamified for personal benefit and greater good.

So I asked myself, “Could we gamify financial improvement and start a whole social trend toward real financial upliftment in the country?”  My exploration started, as usual, with a personal challenge.

Let’s buy a house

I’ve been in the market for a new property for a while and honestly, just haven’t been feeling too confident that I entirely understand my financing options. Most people don’t, of course, but that was little comfort over the hours I’ve spent trying to figure out what kind of loan I qualify for, with which bank and how much I’m in for all told. None of this sounds like any fun, and it hasn’t been until I had a bright idea, “Hey, I can gamify this!” 

So I did, and here’s how.

Set objectives

First of all, I set myself some clear, simple objectives:

  1. I want to purchase a new home
  2. I want a house of a specific value

Decide timeframe for achievement of goal

Considering school terms, year-end holidays and my family’s general excitement at the prospect of moving, I chose a conservative 3-month timeframe to purchase a new house.

Identify risk factors

I found it very helpful to think through the factors that could have a negative or positive impact on achievement of my goals.  Some were just straightforward requirements that I had to meet, others were subject to behaviour — mine and others.

  1. Loan consultant
  2. Banking behaviour requirements
  3. My financial behaviour
  4. Location of the property
  5. Value of the property

Manage the risks

After identifying the risk factors, I took some time to understand the events/behaviours required to support the achievement of my goals.

1. Loan consultant

Buying and selling property is not my line of work and it can be a very confusing process. I needed to find a mentor who would guide me on my home-buying journey; someone who understood the industry and knew what was required of me as a customer to successful qualify for finance. And also someone who would be patient with my questions and straight with their answers.

2. Banking behaviour requirements 

The loan consultant who ultimately joined me on my journey carefully outlined all of the bank’s requirements and gave me a very clear understanding of what needed to happen to achieve my goal within my 3-month timeframe.

3. My financial behaviour

Now that I understood what was required of me, I could take a step back and look at my financial habits over the previous three months and compare those to the behaviours required of me to achieve my goals. I analysed each behaviour as follows:

    • Have I been practicing correct behaviours?
    • Should I change behaviours that don’t help me meet the new requirements?
    • If certain of my behaviours are correct, I need to make sure I continue performing them correctly.
    • How often do I need to perform these behaviours over the next 3 months to make sure my actions have the most positive effect on my goals?

After getting clear on all of those points I set up a scorecard to evaluate and track my progress

4. Location of the property

This was pretty easy, but still, I narrowed my scope to a 15km area.  It was not too limiting, but tight enough to keep me focused on my priorities and my deadline. It also made me look more closely at the pros and cons of each neighbourhood.

5. Value of the property

In this final step, I needed to understand credit industry regulations and how much I was allowed to borrow irrespective of my financial behaviour. With the assistance of my loan consultant, I learned to take a long-view and evaluate a property based on its future value.

A long journey

House hunting carried on for a good three months. It was a tiring, but interesting process. And I’m sure you’re wondering if I ever achieved my goal. Yes, I did!  I found just the right property and got bond approval in exactly a day and a half. And it was offered at subprime!

A good lesson 

Now I have a question. How many people out there actually understand what they’re being measured on when they apply for a property bond or a car loan? How many of them actually understand the behaviours required to get a loan and manage the payments?

In order to achieve my financial goals I had to first understand that I was not setting the rules, I had to play by banking and credit industry rules.  After that, I had to go through phases to achieve success.  

  1. I had to understand what I wanted to achieve and what the requirements were (the rules).
  2. I had to evaluate my current performance against the requirements (the metrics).
  3. I had to track my current performance (using levels/scaffolding to show how close I was to the goal).
  4. I had to control/change my behaviours to impact my goal (show a sense of autonomy over my mission and performance to maximise their effect).

Gamification for good

So after hearing about my experience, imagine how gamification might work in a lending situation. Customers choose their challenge (owning a house for example or saving for a  special holiday) then plug into a gamified system that helps them set clear goals, develop a path to achievement, recognises efforts, evaluates performance and rewards success with fanfare and celebration.

Empowered with this kind of support, individuals stand a good chance of changing bad financial habits and acquiring good ones; certainly a better chance than the current system of obtuse rules and punitive charges offers. The benefits are fewer bad debts for the bank, financial empowerment for people and growing economic stability across society. 

This is gamification to inspire financial upliftment.  Anyone up for the challenge?

 

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Tags: Performance Design enhance financial How to money