Gamification is a buzzword that gets thrown around, but the basic idea is simple: by turning life into a game, with digital rewards for real life achievements, you’ll have higher motivation and be a stickier user for app developers. Sounds like a win win. But, does it work, and what does this have to do with your finances? Let’s take a look at what we know.

We got sick of the endless cycle of broken budgets and anxiety around saving,  if you've experienced this and are looking for a community of like minded people who’re ready to try something new, hit subscribe above and join us on our journey!

What Is Gamification?

Gamification, or adding game mechanics as an incentive system, isn’t new. Credit card companies and airlines reward programs have been using it to make you spend since the 70s. Apps like Duolingo and Noom took this up a level, and the latest research is using it to change how we teach kids in classrooms and help people quit smoking.

With the exception of Robinhood, which for better or worse got a generation addicted to trading, most personal finance apps haven’t been so successful. Adding badges and streaks to an otherwise boring task doesn’t automatically make it fun, and without properly understanding the psychology or overlooking the intrinsic fun factor, they’ve failed to create lasting change.

Which Part Of Your Brain Is Involved In Your Motivation?

If the point of gamification is to motivate you, you first need to understand what motivation is and what needs to happen in your brain.

Ever wondered why it’s so hard to start that gym habit or stick to that diet 6 months in? I’m looking at you, New Year’s Resolutions! It all comes down to motivation, dopamine and self-efficacy.

Psychologists classify motivation into two types, Intrinsic and Extrinsic. Intrinsic Motivation comes from the inherent enjoyment of completing the activity itself, whereas Extrinsic Motivation relies on external factors like rewards and prizes. While external rewards are great for getting you started, like a free trial month or a smoothie at the gym; long-term, life-changing behavior requires you to be intrinsically motivated.

This is peachy, but how can you use it to drag your behind outta bed for that January morning run? Time to understand where motivation comes from: the brain’s dopamine response and Self-Efficacy. If dopamine is the brain’s neurobiological carrot, released to give you a sense of pleasure both before and after you engage in rewarding behavior, self-efficacy reflects your belief that you can complete a task and influences how much effort and determination you’ll exert. In short, long term motivation calls for both a high dopamine environment in the brain and a high sense of self efficacy.

Done well, a gamified app can help hack your brain and create motivation where it was once lacking. Chunking large tasks into smaller increments gives you a dopamine and self confidence boost with each win, leaderboards tap into the power of a little friendly competition, and as basic as they seem, badges and streaks are surprisingly motivational - I’ve not not spent money on a Streak Freeze in my favorite owl app! 😳

Why Do I Get Bored So Easily?

If we think of life as one big game with us on one side trying to “win” the prize, in this case money, then credit card companies and retailers are on the other side trying to bait us into spending. They use psychology to make us impulse buy, lure us with deals to buy things we don't need, and use reward programs to keep us loyal; it's about time we used it to help manage our money better!

If you’re like us and find budgeting and money management boring, you probably find yourself in an endless cycle of setting and breaking spending limits, then beating yourself up about it. Stop! You now know enough about motivation to understand that you were fighting a losing battle; traditional budgeting isn’t fun, so isn’t intrinsically motivating.

To be intrinsically motivated, you need to feel autonomy, or a sense of control over your actions; competence, or a sense of mastery or improvement; and relatedness, or a sense of connection and understanding with other people. Traditional budgeting misses on all three! Spending limits are externally imposed so you don’t have autonomy. They aren’t aligned with your values, so you feel super incompetent when a heavy birthday month blows through your restaurant allowance. And given a budget is a very personal thing, you don’t have a community to share your struggles with, so don’t get social support.

Can A Game Really Help?

We’ve talked about gamification working in learning, weight loss, and medical applications, but what makes us so confident it will work for money management? Easy, we tried it ourselves. As I talk more about here, we started working on Seedling after a change in circumstances meant I had to budget for the first time in a decade. Knowing I’d struggled with budgeting apps before, I fell into the internet rabbit hole looking for creative ways to save and came up with some games. Three tricks saved me hundreds of dollars each month, all of which I still do to this day:

• Seeing how many days I could go between deleting and reinstalling Uber (current record: 33 days)

• Playing “whose Amex-bill is lower” with my friend Joey (loser cooks dinner)

• Not let myself book a flight if I was already in the month of travel (this also made me a better planner!) 

I didn’t know it at the time, but I’d inadvertently made an intrinsic motivation system. The first two tapped into my competitive nature, and the last turned into a fun few hours of trip planning the final weekend of each month. Somehow by stopping it being about the money, the money took care of itself!

Seedling is the first Virtual Pet whose health is tied to your spending. We’ll talk more about features in future posts, but it’ll set personalized challenges like the ones I played with myself, set daily game-based lessons to teach you the things they should have taught in school, and let you compete with friends to unlock interest rate bonuses!

A New Approach To Your Finances

We think turning your finances into a game is the unlock. In future posts we’ll dive further into the psychology, talk about upcoming features, and give you tips on games you can play with yourself to stay motivated.

If you’ve tried and failed with budgeting apps and are looking for a community of like minded people who’re ready to try something new, hit subscribe and join us on our journey!

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