Improving the Borrowing and Investing Experience

Feb  28 
Brenda Waggoner  Senior Writer, Fiserv 

Help people navigate life's important financial decisions to build strong, lasting relationships

It's exciting to dream about the big things in life – college, a new home, retirement. Saving for those milestones? Not so much.

Improving the financial experience may help change that attitude and resulting behaviors. Recently released research from Fiserv found consumer education, advice and access to professional support could be welcome complements to the latest technology options. Findings from Expectations & Experiences: Borrowing and Wealth Management, the consumer trends survey by Fiserv, provides support that an excellent financial services experience not only helps consumers navigate crucial activities, but also builds strong relationships with a financial organization.

The survey, conducted by The Harris Poll among 3,050 banking consumers in the U.S., reveals consumers' attitudes and needs regarding borrowing and investing money. Knowing what consumers want and expect can help financial organizations establish the right strategies and priorities.

Here are highlights from the survey:

People Borrow to Finance Their Lives

From getting mortgages to buying motorcycles, consumers often use loans to finance their lives. Nearly two-thirds of consumers (65 percent) have at least one loan, and 35 percent have applied for a loan in the past two years. Primary mortgages are the most common loans (37 percent), followed by loans for automobiles (35 percent) and education (11 percent).

67 percent of consumers with a mortgage or HELOC say they're somewhat or very comfortable completing a home loan application via laptop or desktop

Millennials are forming households, starting businesses and entering the housing market – and that takes cash. Predictably, millennials are far more likely to have applied for loans in the past two years (45 percent), compared with 31 percent of other generations.

Comfort With Online Loan Applications Is High

Getting a mortgage is one of the biggest transactions most people will complete. A streamlined, intuitive experience goes a long way toward easing what may be an anxiety-ridden process for homebuyers. Although 67 percent of consumers with a mortgage or HELOC say they're somewhat or very comfortable completing a home loan application via laptop or desktop, just 29 percent would say the same about using a smartphone or tablet.

Even so, if it means speeding up the home loan application process, people are willing to use mobile to electronically sign documents (59 percent), upload identification (53 percent) and photograph loan documents for uploading (51 percent), among other tasks.

Most Are Saving for Retirement but Wonder If It's Enough

Overall, consumers express a lack of optimism and confidence about their ability to save for retirement. Although more than half of consumers (57 percent) are saving for retirement, 63 percent of those investors aren't confident they're saving enough.

There are so many variables and scenarios to plan for in retirement. Perhaps that's why 44 percent of consumers don't feel (17 percent) or aren't sure (27 percent) they're getting the financial advice they need. Millennials are more likely to feel uninformed about saving for retirement (16 percent) than older groups.

Investing Is Common, but Wealth Management Experiences Vary

Consumers invest to meet many life goals, from children's educations to travel. Among wealthier investors (those with more than $100,000 in investable assets), 25 percent are investing to attain a goal other than retirement. Investing in nonretirement goals is far more common among millennials (51 percent) than all other age groups (16 percent).

No matter the goal, use of financial advisors is low. Only 28 percent of consumers are working with an advisor. That's unfortunate because financial advisors make a big difference; 81 percent of those who use a financial advisor are confident in the advice they receive.

Enabling a Better Experience

Borrowing and investing fuel the pivotal moments in our lives. Whether borrowing for school, business or a home, or investing for the future, people are making important, life-changing financial decisions. Helping them navigate those choices with the right advice, access to professional support and the latest technology options can enable a better financial services experience.

For additional perspectives on the hottest topics in financial services, join us at Forum 2019 May 6-9 in Las Vegas. Learn best practices, gain valuable insights and take advantage of opportunities to connect with the best and brightest in Fintech.