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Leverage the trust people have in credit unions to create personal pensions. [1/20: Persona's, User Feedback, Prototype in Attachmts]

Create personal pension products for individuals and distribute them via credit unions.

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Who is your idea designed for and how does it support the dreams and obligations of those 50 and older?

This product is designed for those 50 and older. It supports their dreams and obligations by creating a steady income stream from their earlier savings. It leverages the credit union client relationships and physical distribution network to offer individualized pension plans at scale. It is human-centered as it address the need for financial security that many experience in later stages of life.


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Trust is lacking for financial institutions such as banks, money managers, and insurance companies. This has caused a lack of adoption for financial products and services that helps individuals manage their finances.  This is especially acute in the annuity space.  However, annuities have a very important role in one's financial wellness, especially in later stages in life, and in particular in helping manage longevity risk.  

In the past generations, people have had workplace pensions (defined benefit plans). However, with the closure of many defined benefit plans, defined contribution plans (401k/403b plans) emerged.  There are many great benefits to a defined contribution plan, however, it does leave a whole series of financial decisions to the individual, who often times may not have the time, knowledge or interest to manage their finances.  Furthermore, defined contribution plans currently covers less than 50% of the workforce, creating a further need for a retirement plan outside of the workplace. 

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Why a credit union?

Creating a personal pension product and distributing it via credit unions have the following appeal:


1) On a retail basis, the trust one has for a credit union seems to be greater than other financial service providers. As such, I believe credit unions are in a unique place to create this social impact, especially in light of its non-profit business model.

2) In light of longer lives, we are moving from a work life of retiring at 65 to one that transitions into different phases of one's life.  As such, we are also changing jobs more frequently, and having a financial institution that is outside of the workplace to hold one's pension makes a lot of sense.

3) If credit unions can become of union for people, and create communities, I believe this can be a better venue to house one's pension than a tradition financial institution. 

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How might a credit union create such a product?

A credit union can create such a product by combining a selection of investment and annuity products to create the desired pension characteristics.  This can be completed by the credit union or by hiring an investment manager, institutional investment consultant, or an insurance firm.  There will likely be a need for middleware provider to administer the recordkeeping aspects of the solution. (I will leave out the technical details of implementation, but can certainly elaborate further on how this might work.)

The distribution of the product should be framed as a pension for individuals when they first open an account at the credit union.  Contributions to it can be a transfer from workplace savings plans, or perhaps even in addition to that contribution, an automatic deposit monthly. 

What early, lightweight experiment might you try out in your own community to find out if the idea will meet your expectations?

We can do the following to test the idea: 1. survey the credit union client base, describe the characteristics of the product, and collect their feedback and reiterate. 2. see traction of existing retirement or investment product of credit union, and identify pain points 3. conduct segmentation analysis of existing credit unions, and see if current clientele are good fit 4. conduct focus group research of non-credit union members to see if they would join a credit union for this product

What skills, input or guidance from the OpenIDEO community would be most helpful in building out or refining your idea?

Current credit union product teams, staff members, investment and annuity professionals.

Tell us about your work experience:

I am a reformed Wall Street product designer! Currently pursuing my second act in social entrepreneurship to create greater financial security for the American dream. I specialize in design of financial products, and have a passion for all things relating to longevity.

Please check all that apply:

  • I'm not currently involved in a credit union, but am curious to learn more!

This idea emerged from

  • An Individual

How would you describe this idea while in an elevator with someone?

Hi Grandma, Your work retirement plans says you have saved $500k in your 401k plan! Good job! With your retirement next month, you should use a portion to buy a personal pension. Since we are likely to be living a long life (90+!), a personal pension will just send you a paycheck for the rest of your life, so you won't have to worry about running out of money.

How might your idea be transferable to a large number of people?

Product: The amount of the product available is subject to the capacity of annuities being provided by insurance companies. For the most part, I do not foresee an issue with capacity, considering the size of the 50+ retirement assets of credit unions. Further, individuals will probably only use a portion of the assets to purchase the personal pensions. Distribution: This will leverage and likely increase the current wealth management teams. We should also consider digital distribution.

How do you plan to measure the impact of your idea?

1. Amount of assets into the product 2. Amount of income distributed from personal pensions 3. Incremental revenue of product in addition to standard credit union products 4. Length of time someone is a credit union client (hopefully significantly longer, and till end do we part!) 5. Net promoter score of credit union of personal pension client vs. non personal pension client 6. Longitudinal study of trust by personal pension clients 7. Life expectancy of personal pension clients

What are your immediate next steps after the challenge?

1. survey the credit union client base, describe the characteristics of the product, and collect their feedback and reiterate 2. see traction of existing retirement or investment product of credit union, and identify pain points


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