Peter Clemson has spent much of his career in the financial services sector, holding positions at Bank of America, optionsXpress and, most recently, Charles Schwab. During his tenure at Charles Schwab---where he led teams that built the schwab.com platform and the company's retail mobile apps and trading apps---Clemson said that while the company excelled at servicing high-income consumers, it didn't do enough to help the majority of Americans establish financial security.
So he set out to create an app to help people living paycheck-to-paycheck reach financial stability.
“I’ve always preached to my kids that we should be making the world a better place,” Clemson said. “I reached a point where I said, ‘If I’m going to be true to who I am, I have to try to solve this problem.'”
In 2017, Clemson created Evati, an app that allows users to set aside money in an investment account to meet savings goals. The company has raised about $1.2 million from friends and family, angel investors and financial firms including Stamford, Connecticut-based CF Capital Management.
Evati, which currently has five employees, allows users to set up an investment account and create savings goals---like for a vacation or a child's education.
Users can transfer funds directly into designated accounts, which Evati then manages and invests in diversified securities portfolios. The accounts are SIPC-insured for up to $250,000. The startup plans to add savings accounts to the platform in the future, he added.
After using the app for free for the first month, users with $5,000 or less in assets will pay $1 per month; users managing more than that will pay 0.25 percent annually. The platform partnered with Morningstar Investment Management for its portfolio models, Clemson said. To help visualize their goals, users can add pictures to attach to their accounts.
The recent government shutdown that left government workers without a paycheck for 35 days exemplified why it’s important for workers, depending on their income and the stability of their jobs, to save over time to prepare for emergencies, Clemson said.
While the government shutdown has brought the plight of American workers to light, the truth is that many Americans have been struggling to make ends meet for some time. Four in 10 Americans don’t have enough savings to cover a $400 emergency, according to a 2018 Federal Reserve report. The report indicated that one-third of those who aren’t able to pay all their bills said that their rent, mortgage, or utility bills will be left at least partially unpaid. And after adjusting for inflation, workers earning the average hourly wage today have nearly the same purchasing power as employees did in 1978, according to a 2018 Pew Research report.
“If you look at savers as a population, it’s amazing that they really cross the whole income spectrum," Clemson said. "And it shows that a huge chunk of it is mindset. I know not everyone is in that place, but there are far more people in that place than you’d guess.”
