Fintech Spotlight: Nosso
Family finance fintech Nosso helps you set up and manage savings and investments to support your children’s financial future.
In conversation with WealthKernel’s staff, Nosso explores the road to financial freedom and talks about helping parents plan for their children’s future.
- What’s Nosso’s mission?
Despite the fact that the majority of families have shared goals, finance today has just been built and designed for individuals. You and your partner have your own pensions that don't talk to each other, your own savings accounts despite trying to buy a house together - and worst of all if you try investing for your children, only one of you can manage the account.
At Nosso our mission is to rebuild financial services solely for families. Our first product is a Junior stocks & shares ISA that is the first to allow both parents to track their children's future together. It also allows the wider family to get involved, leaving contributions, messages and memories.
We aim to deliver all this whilst also educating our customers and their children and empowering every family to become their own financial planner.
- What motivated the founders to start Nosso?
I’ve been working in finance for a while and have always wanted to help my niece and nephew on their birthdays rather than spending loads of money on toys that I knew they’d forget about in a few months.
When my wife and I had our first daughter we tried to find an account that allowed us to invest together and made it easy for our wider family to help out too. I was shocked by how far behind family finance was!
Take a Junior ISA for example - in nearly all cases today, the features you get in a Junior ISA are identical to those you get with a regular ISA yet the use case is very different and to date has not been catered for. For example when investing for children, at a start you tend to have two parents who want oversight and control, not one, and you also have a wider “village” who all want to do their bit to help. We make this super simple and let you open a Junior stocks & shares ISA for your child in minutes that anyone can contribute to whilst also leaving messages and pictures in a time-capsule that the child receives when they’re older.
I met Sjonni (my co-founder) and we started exploring this space together. The more we looked at it, the more we realised that we weren’t the only ones who felt this way and that this wasn’t the only use case where finance failed to correctly cater to a families need - so we decided to do something about it.
- What are your thoughts on financial freedom and financial security for children?
Most parents have the best intentions for their children. They want them to live a better life than they did (regardless of how great their upbringing was) and be able to have the freedom to make their own decisions without having to worry about debts and costs.
While this might seem like a pipe dream for a lot of families, it doesn’t have to be. But to achieve this “freedom”, a family needs to work together and start thinking and planning for these things early on. Our job is to help more and more parents take the initial steps that set up their kid for a more secure future. Through education of course, but also through accessibility and removing the social stigma associated with helping out your children.
- Do you think there is a knowledge gap there? Is that something that Nosso is trying to address?
There is definitely more of an inaccessibility to knowledge rather than a knowledge gap. Finance has probably been made more complicated than it actually should be - advisors had to prove why they were worth their huge fees. And people don’t have the time to absorb that information because it doesn't come in a format that is easy to understand and easy to take on. So they default to what they already know or what’s pushed to them from the big banks. That’s why around 70% of all Junior ISAs are cash based and not stocks & shares. A decision that nearly everyone would agree is the wrong one.
So we think that's the first barrier and it is something that we're trying to solve with the amount of things that we write.
We’re trying to solve this knowledge gap by delivering content in ways more relatable to the everyday parent. Our blog posts don’t try to complicate things to make ourselves sound smart and we’ve experimented with short form video as a way of educating too. We’ve got a long way to go but hopefully one day we’ll see the numbers of parents investing for their children overtake those savings.
- Talking through the topic of financial freedom, could you explain how the app works to help parents envisage their children’s financial future?
The app tries to understand exactly how you envision using the money that you're trying to save with Nosso. We try to understand what a family wants and what their goals are. The app then asks them questions and shows the products that might be best suited for them but the user has full flexibility and can choose which product they would like to go with.
For example, Junior ISAs are tax free but are restrictive in the sense that once you pay money into that account, it’s locked until the child turns 18 and can’t be used for things like school fees, sports camps or whatever else along the way.
This scares a lot of parents and sees them default to a savings account not knowing that there are other accounts they open to retain some flexibility (like a Bare trust or even investing through their own GIA/ISA.) We’ve built an experience that helps them learn this and make the correct decisions for their family goals.
- Does Nosso envisage a long-term relationship with the users and help them find a plan in their later life?
Yes! Helping parents invest for their children is just the start of our journey. Our goal is to help them build a better life for their family and so that’s likely to see us moving into financial products and plans that help them achieve some of their goals - buy a bigger house, retire early, legacy planning and plenty more. But with each of these services we’ll put a unique twist to make them just right for the entire family, not just an individual within that family.
- Finally, what does the future look like for Nosso?
In the near future, we’re 100% focused on building the investment account that parents can open for their children. This means improving our Junior ISA but also launching one of the first digital Bare Trusts that anyone can open to invest in a more flexible way for their children. After this we’ll likely look at what else our families need and it could see us explore wills / legal guardian products to ensure the child’s future is protected if the worst were to happen.
Long term we want to build the most accessible financial planner for a family - and as I said earlier, that’s only possible if we give every family the knowledge, tools and products to become their own financial planner. We picture a world where you don’t need to pay thousands of pounds of fees every year for a plan or advice - a world where you’re free to live the life you want knowing your family's future is secured.