How health & wealth became synonymous with one another – Dr Thomas Mathar interview

In today’s blog, Waracle client partner, Mike Miller and Dr. Thomas Mathar from Aegon UK, chat about Dr. Mathar’s fascinating insights into human-centred finance and financial wellbeing, which he’ll be sharing more with our event audience in London on April 18th 2024.

Thomas heads up Aegon UK’s Centre for Behavioural Research, which supports internal and external stakeholders with behavioural research and the application of such ideas as nudge theory to help people live their best lives, now and in the future.

Dr. Mathar’s research into the impact of long-term mental time horizons on financial wellbeing is fascinating and as a researcher & solutions-oriented practitioner, he has established a set of tried and tested ways to help people develop the skills needed to focus on future-oriented behaviours.

Let’s explore an excerpt from Thomas & Mike’s conversation…

Tom, thanks so much for agreeing to speak at our Health + Wealth event. What are you looking forward to at the upcoming event?

I’m really looking forward to meeting peers, existing contacts and new contacts alike. I’m also fascinated to hear from some of the other speakers about how they’re thinking about health + wellbeing for customers holistically, and in particular how they may be applying behavioural insights into their design & development practices.

What can attendees expect from your talk at our Health + Wealth event?

There are many longitudinal studies into financial wellbeing globally, and we’ve conducted a lot of our own research at Aegon, including our Behavioural Science and Positive Psychology work as part of our partnership with the University of Edinburgh.

Historically, difficulties with saving and wealth generation have been treated by and large as financial challenges. But we see it differently, we believe that it’s in fact a mental challenge, and that this is something we can help to address both proactively and preventatively.

We’re all familiar with some of the key negative emotions associated with money, such as shame, regret, anxiety and overwhelm. Equally there are positive feelings like optimism, empowerment and feeling proud, all of which combined can really impact people’s propensity to save, make long term plans or sound financial decisions.

The research tells us that to connect more meaningfully and concretely with their future selves, the products and services they use need to not only better communicate purpose, but they need to also appeal to the deepest core emotional needs of people. There are various things that can be done to help people to adapt and change their behaviours in positive ways, to build a future-oriented mindset that results in good financial and overall well being.

We’ve been applying our learnings by integrating these types of helpful behavioural interventions in the real world into the products and services that we deliver to our customers at Aegon, and so I’m really looking forward to bringing some of this to life.

How did your career lead you to head up Aegon UK’s Centre for Behavioural Research?

My role has really been an outcome of an Aegon’s Insight team and their evolution as an outfit. I suppose it’s also in part a consequence of my passion for behavioural science and in part because Aegon embraces the fact that money is an emotionally charged topic, and that it requires nuanced and well-funded research to understand the topic adequately.

Why do you think financial wellbeing has become such a big focus in the financial services industry and why does it matter to you?

I think there are a number of reasons and it depends a little which part within financial services you work within. There are different reasons for banks or mortgage providers to talk about financial wellbeing compared to an organisation like Aegon that provides long-term savings solutions.

For the sector I work in, I think the main reason we talk about financial wellbeing is because we stopped talking about “retirement readiness”. That, in turn, is the result of an increasing number of people realising that the three-stage-life – comprising education, work, retirement – has become normalised and institutionalised over the course of the last 150 years and is increasingly obsolete.

We’re now living multi-stage lives where we still have education in the beginning and something that can be called “retirement” in the end. But what exactly “retirement” is, will be different for different people – for some people it comes with a bang, some people phase into it (some phase out of it again – they “un-retire”). Crucially though, that long stage between first education and retirement is becoming much more fluid.

There’s a first career, a second career, a third career. In between there are transition points. For example we lose interest in a job and re-educate. Perhaps we’re forced out of a job due to AI or robotisation. Perhaps we’re discontinuing a line of work due to burnout or because we want to take time out to spend more time with children. Perhaps we need to take time out so as to be able to provide care for an elderly relative. This multi-stage life (a phrase coined by Andrew Scott and Lynda Gratton) makes long-term planning much more difficult. It’s awfully hard to trade-off financial security today versus financial security in the future. And quality of life now versus quality of life in the future.

In the industry that I work in, financial wellbeing has become such a hot potato because we seek to help people spend, earn and manage their money in line with what makes them happy… today, tomorrow and beyond.

For a provider like Aegon, this means more than just providing financial products. It’s also about facilitating a type of mindset shift that enables a long-term view and helps people pay attention to the things that make them happy so as to help them live their best lives. As said, to help them live their best lives today, tomorrow and long-term.

What are you doing to advance your own financial wellbeing?

Well, as I said, trading off financial security now and in the future as well as quality of life now and in the future is awfully hard. Whether or not I make the right calls is arguably too early to say. I will say though that I’m more naturally a long-term thinker – which is rather rare – so in my case I’m increasingly thinking about the next 18 months and what my wellbeing goals in the short-term might be. 

Neither instant gratification, nor delayed gratification is the goal. It’s about “balanced gratification” – a happy life today and in the future or, in the future and today, depending how you look at it. And in my particular case this means paying more attention to the short rather than long-term.

We’re hearing the term ‘Human Centred Finance’ more and more, what does it mean to you?

It’s perhaps useful to contrast “human-centred” with “customer-centred”. I think the notion of “human-centred” appreciates that it’s no longer good enough to only think of “customers” as in “the recipient of a product or service”.

Essentially, this is what happens when you think of customers. You reduce those humans to the role of the recipient of a product or service. It’s a rather linear, simple, transactional style of thinking e.g ‘We the company produce products and services. Our customers are those who buy these services’.

The notion of human-centricity, however, appreciates the fact that these recipients are humans. They have emotions, biases, instincts, motivations, habits, vulnerabilities and all sorts of contextual or environmental factors that affect how our products and services land and live within the customers’ mental and social worlds.

Human-centred finance is about abstracting the complexity, focusing on the individual and delivering real value that meets the core emotional needs, goals and aspirations of people, enabling each person to make simpler, better, more objective and intentional decisions that support overall well being and happiness.

Our team has worked a lot with wealth management and pensions clients, what do you think the biggest challenges are in the wealth sector when it comes to digital experiences and human centred design?

One of the biggest problems, as I see it, would be in navigating the shift between a 1-2-1 IFA or wealth manager personal relationship and one mediated or augmented by apps and digital toolkits.

At one end of the scale, for people with an opportunity to invest small amounts of money each month, the cost to serve means that robo-advice, apps and web platforms are perhaps more accessible. As you move up the pyramid both in age and in net worth, discerning investors who are increasingly growing sophisticated, expect evermore personal, tailored services… and so the challenge is how to define digital platforms that can deliver this ‘white glove’ augmented experience at scale.

The perception of value is a major hindrance to the proliferation of digital experiences in the wealth sector, as there are still some inter-generational beliefs that a ‘personal wealth experience’ takes place between two individuals. Even if those individuals are using apps and toolkits to explain concepts to one another!

Lastly, as I mentioned before, it really is about mindset and that there’s much work to be done to provide the tools, guidance and advice that will enable people, on the whole, to change their mindset and help them to make good financial decisions.

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We’d like to thank Thomas for making the time to speak to us and being so considerate and frank in his responses.

If you like what you’ve heard and want to find out more, sign up for our event for digital leaders on April 18th in London to hear Dr. Mathar and our excellent speakers from fantastic organisations including WPA Health Insurance, Flagstone & Waracle. 

See you there.