Investing is the key to building your wealth. But most of us never had a proper education when it comes to investing, trade, stocks, crypto, and more jargon that we know nothing about! As usual, fintech is here to save the day with its sister wealthtech!
Wealthtech vs. Fintech
Though some may confuse the two together, wealthtech is not the same as fintech. However, wealthtech is a part of fintech. If it’s not clear to you that it involves both wealth and technology, well, there you go! Going into a little more detail, wealthtech aims to provide digital solutions for the investment and asset management industry. And of course, whenever technology is involved, it aims to make it easier to manage your investments and assets.
How does it work?
Wealthtech uses artificial intelligence (AI), Big Data, biometrics, natural language processing (NLP), and machine learning (ML). Its goal is to improve wealth management and investing in an easy, convenient, accessible, and affordable way. Whenever you hear the word “wealth”, you immediately imagine someone like Elon Musk or Jeff Bezos because their money alone could end poverty in the whole world, but you know it won’t happen. Anyway, wealthtech made it possible for the average Man to build wealth. This tech has opened the doors for new young millennial and Gen Z investors through mobile apps like Robinhood.
Emilia Clark and Will Smith may have planted robot nightmares into our brains, but Robo-advisors are not that kind. They said the end is coming, but we’re safe for now! So who or what are they exactly?! Well, they offer you financial and investment management advice without human interaction. So, does this mean that their advice is always accurate? No, Robo-advisors use ML algorithms to choose the ideal investment portfolios based on your risk preferences. However, with every investment comes risk and no one can predict if the market will swing your way or not.
Like I said, the youth is still building their wealth and wealthtech will help you reach your financial goals. Accessibility and financial inclusion are important goals in fintech and consequently; wealthtech. Through micro-investing, you can literally use change to invest. It eliminates the hassle and barriers of the typical wealth management systems such as requiring a minimum deposit and trading fees.
The rise of wealthtech since the pandemic has been insane. And with the never-ending economy, having someone
or a robot manage and build your wealth sounds like a dream, tbh! So, say “thank you, fintech!”