Scoring Big With Free Financial Advice
Managing your money can be like eating broccoli: You know you should do it, but you never really like it, so you put it off and hope you don’t suffer too much for avoiding it. If you have a spouse who enjoys chatting about this kind of thing like mine does, money matters tend to slip into conversations — like someone who adds broccoli into lasagna and hopes no one notices.
The people who don’t like it always notice.
This week, I surprised myself (and my husband) by getting a better grip on my overall financial picture — no nagging required.
I’ve been testing FlexScore.com, a free website started by two former financial advisers. They designed this site to give people some of the educational benefits reaped by those who pay pricey firms to manage their money. FlexScore makes money when you use its referral partners to complete a suggested action, like opening a Roth IRA account. Later, it may offer a premium version that will include richer features, but the current iteration of FlexScore.com will always be free.
I’ve tried programs like this in the past, including Mint, the Intuit-owned website and app. The difference here is that FlexScore, as its name suggests, gives you a score out of 1,000. With a mouse click, you see how your score compares to that of your peers (age, income and location) and to national scores.
Suddenly, unappealing-as-broccoli finances become a kind of competition — in a good way.
To some people, this score may remind them of a credit score, which is usually out of 850 total points. The two aren’t related.
I set up a FlexScore profile and walked through its handy start-up wizard, answering questions about myself and connecting various online accounts to my profile, including bank accounts, retirement funds and stocks. I also entered some account data manually, like figures from a mortgage company that doesn’t have its account information online.
The website uses bank-level encryption for security, and it’s read-only, meaning that it can’t be used for withdrawing, transferring or trading funds.
You can do several things to try and raise your score, like adding more data to your profile. I felt a zing of satisfaction when my score jumped 20 points after I added a stock that I hold. But if, after a while, you hit a wall and can’t think of any other cash, debts, investments, assets or insurance to add to your profile, you can get points for taking FlexScore’s suggested Action Steps.
For example, I could read recommended articles to get up to 30 more points. One article about goal planning — “Factors to Consider When Determining a Cash Reserve Goal” — wasn’t something I’d normally read. But with more points up for grabs, I didn’t mind it as much.
Videos help explain topics by using clever analogies. A video called “Diversify Your Investments” uses a boat analogy, saying tugboats are best when you need to pull a ship, and large, stable yachts are best for handling rocky seas, but you can’t predict the weather; the same is true for using different strategies depending on economic situations.
One set of Action Steps suggested that I set up some goals for things like college or retirement. These were helpful because they automatically estimated how much I’d need to save per month to get to a goal far off in the future — something most people avoid thinking about until it’s too late to save.
I made a goal titled “Liam College” for my eight-month-old son by entering the college cost per year (a guess); date college would begin; number of years in college; amount of money I’ve saved so far (if any); and how much I contribute per month. By default, this goal assumes a 5.8 percent annual cost increase, but this can be manually changed.
On the downside, FlexScore is only accessible via browsers (computer or mobile work) and not in apps, though the company plans to launch a free app for iOS in August and Android is in the works for 2015. Another downside is that it feels a little bare. I liked the site’s simplicity, but I wanted a little more information about certain things. For example, handsome pie charts illustrate assets and debts with different colors representing different accounts, but none of the pie slices reveal a name of an individual account when you mouse over it. Goals are helpful, but accessing them isn’t obvious from any of the site’s four main screens — you need to know to open Manage Profile, then choose Goals.
Another thing that I didn’t like about FlexScore is that it doesn’t say who writes its helpful articles. It turns out that Broadbridge Forefield does this for the site through a licensing agreement, but when the articles don’t say who wrote them, you don’t know how trustworthy they are.
In addition to making money if you use one of its referral partners, FlexScore also makes money when financial advisers pay a monthly licensing fee to use FlexScore Pro, a version enabling them to manage client profiles (with permission).
It’s tough to manage money, let alone the online passwords required for every account you’ve created. FlexScore needs some improvements, but it does a nice job of organizing accounts while motivating people to keep coming back and improving their score. That stickiness and usefulness make a great combination.