One of the most difficult and damning areas of the American lifestyle is personal finance. As a nation we are deeply in debt and despite our cultural wealth fixation, basic accounting skills are rarely part of a standard education.
Here is a thought experiment that attempts to define a massively multi-player game of financial responsibility. How can we improve the personal finances and savings of heavily in debt individual using the tools and techniques of game design?
A Financial Gedanken Experiment
The key concept is that by using psychological risk and reward systems, we can promote financially sound behavior in an addictive, psychologically positive fashion. The ‘player’ has fun, they save money, and we make money by providing an exciting (and beneficial) game service.
First, let’s begin with a rough overview of the tokens in play. The player is clearly the person spending the money. Money is a primary resource that is generated through a monthly pay check and is spent on several categories:
- Essential: The basics you need to live.
- Luxury goods: Anything above the basics necessary to live.
- Savings / Debt reduction.
This is a great starting place. We have activities (purchasing) that we can categorize and either reward or punish. In the typical gaming world, we would immediately begin building interlocking risk / reward systems to start training the player. Unfortunately, we run into an immediate challenge. Games are typically played on a standardized platform with a well defined user interface and strong feedback mechanisms for the player. The real world is not set up in such a convenient fashion.
Dealing with the real world
As soon as you start dealing with real people and their daily interactions with the world, we are immediately in the land of product anthropology studies. We need to build a game interface on top of the player’s reality and in order to do that we need to understand the basic constraints of their environment. Below are some obvious challenges that do not lend themselves to powerful game designs.
- Overly long reward cycles: Typically you only get checks in lump sums every two weeks. If gaining money is a reward, this occurs at far too long of a pace. On top of this, it is a fixed reward schedule, the exact sort that causes the player to burn out rather quickly. It is a thrill getting the first paycheck, but after a very short while it becomes the status quo.
- Lack of positive rewards: The player’s primary actions occur in the presence of advertising and sales people who reward the player if they spend on luxury goods. There is little or not reward reinforcement for putting money towards saving.
- Untimely feedback: Means of monitoring and providing feedback are highly divorced from the action time scale. You can purchase a very expensive item within a few minutes. Yet feedback on how that affects yours longer term savings goals doesn’t occur until typically several weeks later.
- Micromanagement: Existing systems are poorly defined. In order fit daily activities into the type of formal system required by most game mechanics, an individual is required to spend copious amounts of time with data entry. If I spend money on garden supplies at a grocery store, what does that mean? In the standard accounting viewpoint, this must be entered into a master ledger, tagged as gardening supplies and then manually compared to one of dozen account categories. Typically this happens in an application on a computer and is more effort than it is worth.
The result of all this is that most people begin an attempt to improve their budgeting and give up shortly afterwards because they don’t see immediate results for the work that they put in.
Creating a financial game platform
Solving the interface problem is a priority. The player needs to get immediate feedback every time they make a purchase. Think of a purchase as the most atomic level that any meaningful action can occur at. This is our core risk activity. It is the equivalent of a turn in a game like chess or jumping in Mario. Remember, every core game mechanic is composed of a risk activity and a reward activity. We need a way of tracking purchases and giving feedback on them.
I’m going to imagine a ‘Financial Gameboy’. This is a PDA-like device that replaces all credit cards and filters the use of the credit card through software that is hooked up to the internet (This last point may or may not be necessary.) A cell phone with electronic wallet technology isn’t too far off from my Financial Gameboy, but with a little engineering, this concept should be possible right now.
The Financial Gameboy is a small gadget that slips and your pocket and replaces your standard credit card.
- It acts just like a credit card. You can swipe it in any standard credit card reader. You can make a purchase over the internet. Any purchase that you make is immediately reported back to the device over it’s internet connection.
- It has a display that can show basic text information.
- It has a very simplified interface with 3 or 4 buttons.
Here’s how the basic interface works.
- Before you swipe the card, the Gameboy must be turned on. By simply opening the device, it goes on.
- Basic financial information, including your current goals and progress towards those goals, are displayed in a blatant manner. Just by glancing at the device you can tell your status as either within budget or over budget.
- When you swipe the card, you are unable to complete the transaction until you identify the basic category the purchase falls into. Once you make a purchase from the same vendor, the device remembers if you’ve categorized it previously and saves you a button push. There are only 3 or 4 categories, each corresponding to a big button, so ‘accounting’ is trivial.
- The card shows you your new status information and any rewards you might have accumulated.
Additional gaming rules
The interface with real life is always messy. In addition to electronic rules, there are specific social constraints that are necessary to ensure that the risk / reward system can do their work within a constrained formal environment.
- You aren’t allowed to use cash beyond a predetermined weekly allowance. Lower cash use is better because it lets you sidestep the risk / reward systems of the game.
- You aren’t allowed to use any other credit cards.
- Your paycheck is automatically deposited in your account.
- Major bills are put on automated payment.
How the game works
All this foundational structure is wonderful and I suspect would result in major improvements to anyone’s spending habits. Simply having a shorter feedback cycle and an understanding of where you are financially is more than most people have when they are making purchases.
The real benefit comes from the addition of game mechanics that actively change the player’s behavior in a positive fashion.
First, we do away with the bi-weekly ‘influx of cash’ that seems to define everyone’s bank account. Instead, the player earns the ability to make additional purchases based off their skillful daily purchasing behavior. Even though your bank account has money in it, you don’t get to touch it unless the game lets you.
Mind you, the game doesn’t use a simple quota system like most budgets do either. The player would only get feedback when they hit a hard budget limit and that just isn’t timely enough to provide solid operant conditioning.
The player’s money is dribbled out to him in the form of immediate rewards.
- Risk Activity (a.k.a. the Purchase Challenge): Every time the player makes a purchase, it is ranked as either a good or bad purchase.
- Good or Bad is determined by a purchasing profile: For example, food purchases are typically $10 for meals and $100 when you buy groceries. Anything over these amounts is bad. Anything under is good.
- When you make a good purchase, you earn points (think of it as experience points in an RPG) towards luxury items.
- Luxury items are defined the player in a big web-based wish list that they can prioritize. There are also generic items like candy bars and such they can also prioritize.
- The amount of points you get for each purchase is governed by a complex system of combos, random bonus, and other overlapping reward systems. Buy three good food items in a row for less than you expected and get a free minor reward. Wow.
You’ll win some purchases challenges and you’ll lose some. The game will start out on a relatively easy setting with simple rewards giving you substantial rewards. As you ‘level up’, you’ll start aiming for the bigger prizes and that means aiming for more good purchases, and less bad purchases. Over time, you’ll start playing meta-games to optimize your path towards those larger rewards. “Aha”, you’ll say. “I can avoid a whole bunch of purchases by eating in.” The game, sensing a lack of purchasing activity will give you additional bonuses.
Underneath all of this is running an accounting engine that is funneling X% of your income towards savings, Y% towards fundamentals, and reserving some Z% for luxury rewards. Transaction after transaction, day after day, month after month, money will be funneling towards your longer term goals. As you get better at playing the game, you’ll see your goals arrive faster than you expected.
With internet connectivity, you can start layering social reward systems on top of the basic mechanics. Algorithms can generate high score lists and compare you to other people in your area. As you improve, you start climbing the list. As you make additional levels, you get social awards. You can SMS other players words of encouragement and if they feel like the comments helped, they can mod you up, giving you more points to spend on your personal financial goals.
This massively multiplayer social lubrication leads the player to websites and blogs where tips are shared for getting ahead. The trick is not to create a self help group. This is no pity party. The goal is to create a cheat site for the avid gamer so they can ‘beat the system’. This highly creative lateral thinking helps them save more money and reach their goals more quickly. We are tying into the powerful psychology of solving a fun problem. We are avoiding the dead end psychology that comes from couching financial management as a painful task that must be accomplished with no short term benefit.
What this accomplishes from a game design perspective
We’ve done the following:
- Shorten the risk / reward cycle dramatically from once every 2 – 4 weeks to every purchase.
- Build multiple overlapping risk reward mechanisms that reinforce behavior and prevent burnout.
- Create meaningful rewards and set up clear activities for reaching those goals.
Target Market and Cost
The target market is people in debt. The service costs $5 – $10 bucks a month, but promises to save the player thousands of dollars. The numbers don’t lie and we gather lots of numbers. In fact, with all the successful numbers in our hands, some of our biggest customers can be financial groups trying to mitigate the cost of people who have difficulties managing their debt. They would much rather have a low-risk system that gets proven results than have to go through the morass of bankruptcy and collection.
The opportunities to sell financial and investing services are also huge. Not only do you have access to the player’s money, but you can also directly influence how they are spending that money by weighing certain options as more beneficial than others. The biggest reason for bankruptcies are unexpected hospital bills hitting families who are too highly leveraged on debt. Wouldn’t it be nice to build the game in a such a fashion that it makes health insurance a slightly higher point value investment than items like a new car?
The morality of the issue is neither black nor white. The application of addictive gaming systems to everyday life is relatively new ground. What do we do when we can make the ‘real world’ just another part of an abstract, highly addictive game?
I would certainly use my Financial Gameboy constantly. At a very basic psychological level the act of financial accounting is painful. To make this modern micromanagement affliction into an activity that is both fun and productive is a nearly god-like accomplishment. The ramifications within our capitalist society are nearly boundless.
Perhaps this is the true future of game design. The most successful games may not be art. Instead they will be useful.