How SoFi’s ‘Coach’ App Delivers Personalized, Actionable Advice — and Drives the Bank’s Expansion Plans
By Steve Cocheo, Senior Executive Editor at The Financial Brand
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Increasing numbers of consumers use ChatGPT and other large language models for financial research and advice. One of the flaws in this approach is that the models aren’t steeped in detail about the consumer’s financial circumstances, future plans and hopes, and individual challenges.
SoFi has launched a new AI-based tool, SoFi Coach, that attacks the problem from the other end of the spectrum — an intimate understanding of the consumer’s affairs.
SoFi Coach is built to incorporate SoFi Relay, a service that pulls together people’s financial details from SoFi as well as other providers, with users’ permission. SoFi Coach improves on the Relay foundation by adding analysis, personalization and actionability in its recommendations.
Coach can address matters as small as whether spending $6 on a latte that morning was a good move or as large as how to plan for a child’s college choice (and how to pay for it). Even bigger matters can be addressed, like whether someone can afford to have a baby or if they can afford to get divorced, says Lauren Anastasio, SoFi’s principal financial planning expert and AI financial coach domain lead.
Key perspective: SoFi designed Coach to allow its members to engage to the degree they want to, from toe-dipping to a deep commitment.
Need to Know:
- SoFi Coach can be used to track spending, set spending targets, manage debt, explore refinancing, plan for major life goals and more.
- SoFi Coach was developed under a team of financial planners hired and headed by Anastasio, who came to SoFi last November. They provide the experienced human element behind Coach.
- The team “is the resource and source of truth that evaluates how Coach is performing, to ensure that the responses members are receiving are grounded in sound financial advice and consistent with guidance that those financial planners themselves would give the same person,” says Anastasio.
- While SoFi Coach is a tool for members, SoFi leaders hope it will also drive more consolidation of business in the company’s own deposit, investment and credit options.
“It’s sort of like having a gym membership,” says Anastasio. “You don’t have to show up every day at six o’clock in the morning. You can if you want to. It’ll be there for you when you want to use it or need to.”
If the member does want help, there’s no limit to the number of questions they can ask, the time of day they can pose them, nor the frequency of doing so.
Key insight: An indication of the appetite for input from a trusted AI provider: After a soft launch among premium customers (SoFi Plus) in June and a wide rollout in July, as of mid-August SoFi Coach had already had more than half a million conversations from among its 15.8 million members.
SoFi Coach’s opening screen and the member’s dashboard.
How SoFi Coach Changes the AI Advisory Equation
The new advisory tool works within SoFi’s app and is also available through the company’s website.
Using open banking connections to other providers — Relay can link SoFi Coach to around 12,000 third-party financial companies — the tool can give members a very complete picture of their finances. But that’s just the beginning, according to Anastasio.
“Not only can you log in and have that insight, but you can dig into what the information means and how it might contribute to a decision you’re trying to make today — and be offered the next steps to get you to what you’re trying to accomplish,” says Anastasio.
How this is different: Financial management tools have gone through multiple iterations for years. Anastasio believes Coach has upped the game beyond “a very generic, possibly accurate, but unhelpful response” and gives people genuinely personalized information.
“People will see what their credit health looks like, what they have available for a down payment, what their monthly cashflow can absorb, and based on the financial commitments associated with homeownership in that specific zip code,” she says. This level of analysis supports decisions from buying a first home to determining how and when one can think about retiring.
SoFi Coach conversations about the state of a member’s credit can be quite specific and detailed.
Moving from Advice to Action Inside the App
Currently, recommended actions are not independently agentic. The member still has to authorize the step, so that no unintended execution occurs.
An important guardrail: “We’re not taking any level of autonomy from the member,” says Anastasio. “We want our members to build trust in their relationship with Coach, so we’re not surfacing anything that would compromise our members’ trust in the experience.”
Read more:
How Will SoFi Coach and Other AI Help Impact Human Financial Advisors?
As AI-based financial planning and advice gains credibility and traction, a key issue for banking and investment providers is how it will affect traditional human financial advice.
Anastasio, a veteran planner, advisor and private banker, expects that broad availability of tools like SoFi Coach will actually increase demand. Such assistance, once comparatively scarce and limited to people with higher income and assets, will drive this, as access to help increases.
Over her years in the business, Anastasio’s friends and relatives often approached her with questions. Many would never have engaged a professional planner on their own, she says, in the belief that they didn’t have sufficient assets nor financial challenges to justify paying someone a fee for advice.
“I’m optimistic that tools like Coach will help folks who were apprehensive, who didn’t explore any advice outside of Google or fintech,” says Anastasio. She thinks good advisors will see increasing demand for their services as a result.
Why this will happen: “Money is abundantly emotional,” says Anastasio. “We tend to overestimate what a certain level of financial literacy will do for someone.”
In this instance of optimizing the member’s finances, SoFi Coach suggests a deposit to savings of $1,800. The action step will be presented in a non-marketing way. SoFi wants to maintain trust by not looking like an advertising platform.
An example: “What should you do if the stock market drops? Most people will say that you should ride it out, that you want to buy low and sell high. Objectively that makes sense. Emotionally, it is very, very challenging to follow that guidance.”
Anastasio believes the greatest value of tools like Coach will be members’ ability to make more-informed decisions, with fewer unintentional mistakes. For example, she says, the issue of improving one’s credit score is full of misinformation. Coach can help a member take actions specific to their circumstances, sometimes contrary to conventional wisdom.
More emotional issues, like not buying a home that you can afford on paper but that will stretch the budget to breaking will still be a challenge, even with access to AI tools. One of the perks of SoFi Plus membership is availability of unlimited free sessions with certified financial planners.
Read more: Why Bank App Virtual Assistants Still Need Assistance Themselves
How Coach Fits into SoFi’s Aggressive Growth Plans
At every quarterly earnings session, CEO Anthony Noto talks at length and with enthusiasm about SoFi’s growth in membership, fee income, revenue and more.
During the second-quarter earnings briefing in July, Noto said that “SoFi Plus and Coach are exactly the kinds of products that make our model more powerful over time,” including creation of more opportunities for “cross-buy.”
SoFi has long positioned itself as the banking and investment choice for people who could improve their lot if they could get their financial basics under control and devote more of their income to investments. SoFi Coach plays into that idea, but SoFi wants to see them accomplish those goals using SoFi products and services. As a result of conversations with Coach, SoFi says it has seen members linking additional accounts to obtain more personalized suggestions, opening checking and savings accounts, and transferring funds to existing SoFi accounts.
“Every interaction with Coach gives us real-time insights into what matters most to our members: what they need and where we can help them the most,” said Noto.
“The formula for ‘getting your money right’ is simple: Spend less than you make and invest the rest,” is a mantra of Noto’s.
Read next: Retail Bankers Are Adopting AI for All the Wrong Reasons
