Fintech business Chest prepares to debut a novel pension application, transforming daily expenses' remaining funds into investments for future retirement.
A new fintech startup, Chest, is set to launch a pension app this Autumn, inviting young people to join in their mission to revolutionise retirement savings. Chest aims to become one of the largest personal pension providers in the UK and other countries it operates, with the goal of improving the quality of life for millions in retirement. The startup is particularly focused on aligning pensions with the financial habits of young, digitally savvy generations like Gen Z and millennials.
According to a recent survey, 66% of Generation X and 70% of all respondents also use reward and loyalty schemes. Chest's innovative approach allows app users to deposit cashback from everyday spending, such as shopping and buying coffee, directly into their pension.
The app has already gained traction with Gen Z and millennials, who on average save between £6 and £40 per month using cashback, discounts, coupons, and loyalty points. An impressive 72% of Gen Z and millennials use or earn cashback from reward and loyalty schemes monthly.
Jason Murphy, another co-founder of Chest, expresses concern about the long-term consequences of young people prioritising immediate life costs and short-term savings, which could impact the retirement plans of millions. Misplaced optimism is prevalent among Gen Z and millennials, with 29% feeling confident about their retirement savings and 20% believing their workplace pension will be sufficient for retirement, compared to 15% of all adults.
However, 39% of Gen Z and millennials cannot afford to save for retirement due to high living costs or short-term priorities. This is where Chest comes in, making saving for retirement easier by offering a platform that seamlessly integrates with existing spending habits.
Chest is backed by initial funding from angel investors and supported by the Baltic Ventures and FinTech Wales accelerator programs. Future fundraising is planned to establish and grow the Chest user base.
The app is set to launch this Autumn, and participating retailers include Amazon, Sainsbury's, Starbucks, and Tesco. Chest co-founder Ali Adam states that many people, despite earning above-average salaries, struggle to save for retirement due to high living costs and a lack of trust in pension companies.
In addition, nearly a third (28%) of Gen Z and millennials want more financial information and guidance on pensions compared to 20% of all adults. Furthermore, 43% of Gen Z and millennials want to know how much they will need to live comfortably in retirement, while 28% want regular updates about their retirement progress.
Interestingly, 1 in 3 Gen Z and millennials turn to social media and influencers on these platforms for financial advice. Chest aims to provide a platform that not only helps young people save for retirement but also offers educational resources to help them make informed decisions about their financial future.
As the launch of the Chest app approaches, it's clear that this innovative fintech startup is poised to make a significant impact on the retirement savings landscape for young people. With nearly a third (29%) of under 45-year-olds feeling confident or hopeful about their retirement savings, there's a clear need for a platform like Chest that makes saving for retirement accessible and easy.
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