Meet fintech that is trying to eliminate crises for financial caregivers

Every time he is asked about the origin of Carefulsaid founder Todd Rovak that people expect him to tell a story about how a difficult, personal life experience spurred him to create what he describes as “the first fintech built exclusively for financial caregivers and aging adults.”

There is truth in that. Rovak, like millions of other Americans, found himself in a situation where he suddenly became responsible for the finances of an aging parent.

But what really ignited a fire under him was the time he spent as CEO of the product innovation company Fahrenheit 212, where he led the creation of new products for Fortune 500 companies across financial services and other industries. When Fahrenheit 212 was acquired by information technology company Capgemini in 2016, Rovak became CEO of Capgemini Consulting North America.

Careful

“The idea actually came from advisers. Time was spent with Charles Schwab. It was time spent with the world’s Vanguards, Rovak told Financial Planning. “They wanted to find the stages of life where they could help and identify triggering moments where we could be more helpful. They had a staggering aging population to serve and no response.”

The second problem, Rovak said, is that when financial services firms define life stages and deploy solutions to help in those key moments, the same old themes dominate the conversation over and over again.

Marriage. Divorce. Having children. Pension.

“It’s like that, and you can not make more life,” said Rovak. “But there are about 45 million people in the United States alone who are involved in their parents’ finances. They log on. They help. They move around on money. There are just as many who have student loans, but no one talks about them.

«I have never seen a more underserved person in financial services and planning than a financial caregiver… someone who has been drawn into this without tools, no permits, no experience, no help. Nothing. “

Carefull, founded in 2019, aims to change that by integrating transactional and financial behavior monitoring, family communication and educational content into a mobile platform. Rovak said Carefull allows family members and other caregivers to build a safe “care circle” around an elderly loved one while keeping their dignity and independence intact.

The goal, he said, is to bring simplicity, intelligence and tools to a complex part of life that is much longer than people are aware of and that comes with a lot of change along the way.

“Being old is not a moment. It is a whole phase of life that has different phases and four major trigger moments, “he said.” It is a trigger moment when a child is drawn in to help a parent who is still independent, but who only needs a new set of eyes. .

He added that the problem is not one that goes away on its own, and it is often accompanied by other major changes. According to a study from Merrill Lynch41% are called to this work due to a sudden event such as fraud, a lost bill or the diagnosis of a memory disorder such as Alzheimer’s disease.

The study also found that these caregivers spend $ 190 billion a year on adult caregivers. Despite this, 91% of caregivers said they were grateful they could be there to provide care, while 77% “would happily do it again.”

Carefull raised $ 3.2 million in start-up funding led by NextView Ventures and Bessemer Venture Partners and launched in early 2021 in the form of a light-touch app similar to Credit Karma.

But instead of monitoring a credit score, Carefull monitors financial behavior and relies on rule-based AI to detect irregularities or possible fraud targeting a customer’s accounts.

“We have built an AI engine that looks for things that people cannot see, advisors cannot see and banks do not look for today,” Rovak said. “For example, we look for charitable donations. Your bank does not care if you make charitable donations, but I do care if your aging parents do. Why? Because they have relatively weakened judgment when they do and like to give away money. Political donations too … because both political parties convinced older adults that the world was under, made them sign up for recurring deductions and they did not know it.

“So here is your tweet from Congressman so and so. You sign up and give $ 10. And suddenly you have a deduction that comes out every month. ”

Rovak said that duplicate payments and reduced pharmacy expenses are also examples of the type of red flags Carefull is looking for. Caregivers then receive that information and can decide if or how to intervene.

«Say that your pharmacy consumption drops by two thirds. Another (personal finance management) app would say ‘good job. You saved money and you’re under budget. ‘ But it actually means that you may not take care of yourself if you are over 65, he said.

He adds that Carefull’s AI is not driven by a set of rules that are suitable for everyone. Instead, the platform looks at many years of personal financial history to find out what normal looks like for each family.

What can be gleaned from such an analysis is eye-opening and potentially life-changing, Rovak said. He quoted research published by John’s Hopkins in 2020 who found older adults show symptoms of dementia via financial failure up to six years before a medical diagnosis, which revealed in lost bills and reduced credit scores.

In addition to monitoring, Carefull works to create a circle of trusted contacts for each client. Once established, these individuals are allowed to receive account alerts related to their loved ones. There are also password management and document management solutions to take the stress out of emergencies.

“It sounds like a small thing, but your parents need a password manager because they are the keys to the financial kingdom. And what they do is write things down and put them in a drawer, or put them on a Post-It note and stick them on their computer, “said Rovak. “So when a counselor asks them for information, children have to go through things and basically go CSI on their parents to find account information. Technology should make all this promise, and what the counselor really needs is a reliable backbone that creates infrastructure between generations before. it is a moment of crisis. “

The last pillar of Carefull’s three-pronged approach is education. Personal finance journalist Cameron HuddlestonThe author of the book “Mom and Dad, We Need to Talk,” serves as the family finance expert for Carefull and leads the thesis when the organization publishes advice to counselors on a regular basis.

By putting it all together, Rovak believes that Carefull has the potential to create stronger bonds between counselors with aging clients and family members who will eventually become the family’s next financial leaders.

“You have $ 24 trillion in wealth transfer in motion, and nine out of 10 people will not use their parents’ counsel. So if you separate from the human problem we are talking about, and you look at it from the counselor’s point of view, you now have something that is a huge problem for people as well as a commercial problem for counselors, he said. “If I’m a counselor, I have no relationship continuity. I have no cross-generational connection … to the kids, I’m just ‘daddy’s guy.’ This creates more ways to get involved.”

Carefull is free to try for 30 days on Apple and Android devices. After that, it’s $ 9.99 per month when paid annually or $ 12.99 per month when paid monthly.