... and I don't mind one bit.
This young generation has it so well. In my day, there were no websites to help you pick all the best financial tools. Of course, we had to walk uphill to class through 5 feet of snow (both ways!). And we liked it... we loved it!
My Grumpy Old Man is still a work in progress. I'm no Dana Carvey.
Nowadays, it seems there are new websites popping up all the time to help you with your financial decisions. I'd say that I get somewhere between 40-60 emails a year by companies.
However, a couple of weeks ago, I was contacted by one company who stood out from the pack. Yes they are based in the suburbs of Boston, and we know how I love the city of Boston. When I lived in Silicon Valley, I could throw a rock and hit a dozen start-up companies creating websites to help you with your finances. In Boston, there are very few.
The company that contacted me was Cinch Financial. They are new. It's rare for any new company to have everything figured out. It's laughable to compare what Mint was like in April of 2007 when I first saw their unreleased beta to what it is today. That said, there's a lot to like about Cinch.
Cinch gives you recommendations in four areas: credit cards, banks, mortgages, and auto insurance. They start with thousands and products and whittle them down based on factors like availability where you live, reputation, customer service, good deals, and more. It's worth watching going to their website to see the animation of all the companies disappearing through their screening process.
I particularly liked how they score credit cards. Instead of giving you a few hundred to look at like many credit card sites, they start at 2,300 and knock out 97% of them. So there are under quality "Cinch Pick" cards. Their software asks what's important to me and directs me to the appropriate cards.
So How Does it Work in Practice?
When I took it for a spin, it recommended three cards for me. Two of them I already carry in my wallet. The third was essentially an equivalent to what I already had. In fact, I'd recommend that card to my own mom. (Seriously. Mom, it's the Citi Double Cash Card and it beats the Fidelity Retirement Rewards card by Amex I use because you can use it in more places. It'll give you the equivalent of 2% cash back on everything you buy.)
I couldn't ask for it to do any better.
With banking, it suggested Capital 360 and Ally Bank. I have heard good things about both. However, I'm not moving away from USAA any time soon. I asked why USAA wasn't recommended and it was because you have to be military to be eligible and their software wasn't quite at the level of asking that at this early stage.
I wasn't looking for a mortgage and the tool didn't mention refinances, so I didn't give that software a try. I did notice that there were no Cinch Picks yet in my state. The auto insurance also lacked Cinch Picks. I'm happy that they up-front with an "I can't help you" message rather than just passing me to a nationwide company that may be less than ideal.
That brings me to an important point. They could easily have recommended Geico after Geico dropped off a bag of money on their door and I don't think anyone would have batted an eye. However, on the front of their website in the center they make it quite clear, "We only show you the best financial products, and we don't get paid by the companies on our site."
An obvious question would be, "How does Cinch make money?" Typically companies such as Mint and Credit Karma do make money when they refer you to a finance service. In my experience, those companies send people to sound, reputable financial services such as an American Express credit card or Vanguard brokerage services.
Cinch doesn't make this way. The person I was talking said, "Today, we focus on building the best possible product and user experience, and we figure the revenue model will become clear once we have something that users love."
BillSnap: An Interesting Feature
They have a feature called BillSnap where you take a picture and upload it to the website. They analyze it and tell you how you can save money. It sounds good in theory, but I'm going to reserve judgment for a few reasons:
- Is It Helpful? - A number of bills like utilities can't be negotiated that much.
- What About Privacy? - I don't know if I want them to be reviewing my purchases. Are they going to give me lifestyle feedback such as "Hey you eat out too much?" What if a rogue employee got the account number on a credit card and was able to use it? They would likely need security codes and expiration dates to do any serious harm. However, there's a reason why I (and many, many other people) shred their bills. It feels like it defeats the purpose to upload them over the Internet.
- What are Paper Bills? - Cinch suggests uploading mortgage and insurance bills. I have put insurance bills on auto-pay and paperless statements long ago. My mortgage is also on auto-pay, but I do get statements every month because I want to see the progress made. This leads me to...
- Is Any of this Going to Help ME? - I'm not the typical Cinch client. I'm weirdly obsessed with personal finance and I know that. So am I going to upload my 15-year refinanced mortgage at 2.75%? I just wrote 600 words on why switching from Straight Talk to Cricket Wireless may save me 8 dollars a month (article not published yet).
Someone else may get good value from the BillSnap feature and maybe I would under the right set of circumstances. For me, personally, getting a bill to test and any privacy concerns outweigh the value I expect to receive. The average consumer will be different, but these are the kinds of things I think about. (See, weirdly obsessed with personal finance.)
I'd love for a reader to try out the BillSnap feature and tell me how it works. If you do, please contact me.
I saved what I liked best about Cinch for the end. You don't have to login or create an account. It is probably helpful to create one to save your progress, but I could get a bank recommendation quick and easy.
The most interesting thing for me is that they are focusing on creating value and growing mindshare. I think when you do that and help people, you'll find that the opportunities for money will follow.
The only problem I have is that if Cinch Financial is successful, they might not need personal finance bloggers like me to review banks and brokerages. I'd be happy with that outcome, because it means that everyone is great service.
Next: Is Every MLM a Scam?