Gamification in Finance: Fun or Foolish? A Worried Old Man's Take

Alright, so everyone’s talking about gamification in finance these days, isn’t it? Banks and fintech companies are slapping points and badges on everything – savings accounts, loan repayments, even budgeting apps. It’s supposed to make managing your money “fun,” like a video game. Honestly, I’m not so sure about it, and I'm not the spring chicken I used to be, you know? It reminds me of those times when folks got caught up in get-rich-quick schemes – all flash and excitement, but not much substance.

The original article talks about this fellow Blanchard, a professor type, and he’s been poking around at what happens when you take away the gamification. Turns out, folks don’t stick with the good habits as much as you’d think. Seems like those little rewards – the points, the leaderboards – they’re good for a while, but they don’s build real financial literacy, does it? It’s a bit like training a dog with treats; take away the treats, and the dog forgets the tricks, doesn’t he?

This fellow Blanchard, he’s got a point about raffles being better than prize wheels, too. I know, sounds crazy, right? You’d think spinning a wheel and winning something instantly would be more motivating. But he found that the anticipation of a raffle – the possibility of winning something later – keeps people engaged longer. It’s like waiting for Christmas morning, isn’t it? The anticipation is half the fun. It’s interesting because it challenges the conventional thinking, doesn't it? Conventional thinking suggests that immediate rewards drive more engagement than delayed rewards.

The research mentions this Flourish FI company, and they gave this professor access to real banking data. That’s good, isn’t it? Real-world data is always better than just guessing. It's good to see that companies are willing to let academics poke around and see what's really going on. I'm always skeptical of companies who only want their own story told, you know? They don't want anyone questioning their methods.

I read this other bit about how gamification can be used to make financial management "fun and increase consumers' financial literacy." That's a nice thought, but I’m not convinced it’s working. I mean, are people really learning about compound interest and asset allocation because they earned a badge for saving $100? I doubt it. It’s more like they’re just chasing the next reward, the next level, without really understanding what they’re doing. It's a bit like playing a slot machine – you might win sometimes, but you're not really learning anything about investing.

There’s this worry about the ethics of it all, too. These fintech companies are incentivizing certain behaviors, and it’s not always clear if those behaviors are in the best interest of the customer. Are they encouraging people to take on too much debt? Are they pushing them into investments they don’t understand? It reminds me of those times when companies would sell snake oil – all promises and no substance. We need to be careful about letting these companies run wild, don't we?

And it's all tied into this bigger picture, isn’t it? This whole thing about behavioral economics and nudging people into making certain decisions. It’s a bit unsettling, really. Are we losing our ability to make our own choices? Are we becoming puppets of these algorithms and these gamified systems? I'm not sure I like the sound of that, to be honest. I'm not sure if that's such a good idea after all. It's a slippery slope, you know? It's a slippery slope.

I came across this article about dark pools, and it made me think about transparency in financial markets. It’s all about knowing what’s really going on, isn’t it? And these gamified systems, they can be a bit opaque, a bit hidden. It’s hard to see what’s really going on behind the scenes. We need to demand more transparency, don't we? We need to know how these systems are working and what impact they’re having on our finances. It's a bit like those times when folks got caught up in get-rich-quick schemes – all flash and excitement, but not much substance.

So, what’s the bottom line? I’m not saying that gamification is inherently bad. But we need to be careful about how we use it. We need to make sure that it’s actually helping people to become more financially literate, and not just encouraging them to chase rewards. We need to demand more transparency and accountability from these companies. And we need to remember that managing your money is a serious business, not a game. It's a bit like training a dog with treats; take away the treats, and the dog forgets the tricks, doesn’t he?

That's all folks!