The fintech industry has long fantasized about automating finances. The earliest example of this is automatic billpay, which is so common today it is considered table stakes.
Wealthtech player Wealthfront is taking personal finance automation to a new level today with the launch of Autopilot, the first service under the company’s Self-Driving Money umbrella. Autopilot takes Wealthfront Cash clients’ savings and automatically monitors their balances and moves money around on their behalf to maximize their savings and returns.
Wealthfront Cash is a challenger banking service the company launched last year. The account, which is key to the company’s Self-Driving Money concept, is fee-free and pays accountholders 0.35% APY on their savings. When an accountholder’s paycheck is deposited into their account, Wealthfront optimizes the allocation of the funds by automatically paying bills and routing the remaining funds to investments, savings accounts, debt payoff, etc.
“Our clients are diligent savers and follow best practices to grow their savings, but they struggle to prioritize managing their finances among a long list of competing priorities,” said Chris Hutchins, Wealthfront’s Head of Autonomous Financial Planning. “This can lead to missed days in the market or missed days of compounding interest, which has a huge negative impact on your long term net worth. Autopilot is your free financial assistant, automating your financial tasks to ensure your savings are put to work immediately in the best account for your goals.”
Wealthfront’s next development will improve upon the speed of money movement within its ecosystem by implementing services such as same-day investing. The company already offers clients the option to receive their paychecks up to two days early when they use direct deposit with their Wealthfront Cash account.
“We’ve set out to build a new system that makes money with our clients, not off of them as traditional banks do,” said Wealthfront Co-founder Dan Carroll. “The system we’re building has the potential to be one of the biggest wealth creation engines of our generation, automatically optimizing your money in the background while saving you time and stress.”