Fintech

NewRetirement aims to shake up retirement planning with a holistic approach

Comment

eldertech, logevity tech. Bold
Image Credits: panchanok premsrirut / Getty Images

When entrepreneur Stephen Chen’s mom began approaching retirement age, she was forced to borrow money from Chen — and Chen’s brother — to make ends meet. They wanted to help, but the siblings also wanted to figure out a more sustainable, long-term solution that’d help their mom retire without having to worry about finances.

Chen tried to get guidance from a financial adviser, but no one would take his mother as a client because her net worth wasn’t considered high enough. So Chen started building spreadsheets and financial models himself, doing his best to figure out how his mom could live the retirement lifestyle that she wanted.

“People like my mom lack the tools to look at their money holistically and strategically so they can make informed decisions, monitor their financial situation, understand which levers to pull and when and make the connection between the choices they make today and the long-term ramifications to their plan,” Chen told TechCrunch. “There’s a confluence of factors that may alter the future of financial planning and advising.”

It was after Chen helped his mom lower her expenses, figure out when to claim Social Security, decide when to downsize and take other steps to become financially independent that Chen realized lots of other older Americans were facing the same challenges.

So Chen founded NewRetirement, a Mill Valley-based company building software to help people create financial retirement plans. Today, NewRetirement’s direct-to-consumer products power financial planning for 70,000 users managing close to $100 billion in their own financial plans, according to Chen.

“Our models go beyond savings and investments, taking into account all of the other factors in a person’s life, from home equity, healthcare costs and taxes to Medicare and Social Security,” Chen said. “Every time a user makes a change, we run thousands of simulations in order to help them optimize their plan … We account for thousands of different scenarios, enabling users to confidently map out accumulation and decumulation projections with digital guidance.”

NewRetirement is Chen’s second startup after Embark, an online college search and admissions tool he launched in 1995. And, like Embark, Chen sees NewRetirement as a digital solution to a transition faced by millions of Americans.

“120 million Americans over age 50 hold 80% of the wealth in this country,” Chen said, “But running out of money remains a top 10 fear, with nearly half of Americans saying they are worried about it.”

NewRetirement
NewRetirement’s platform uses predictive modeling and data analytics to help users suss out the right savings approaches. Image Credits: NewRetirement

Indeed, the majority of Americans — as many as 65%, per Charles Schwab’s Modern Wealth Survey 2023 — have no formal financial plan. And while 37% of respondents say that they work with a financial adviser, two-thirds of Americans believe that their financial planning needs improvement, according to Northwestern Mutual’s Planning and Progress Study 2023.

NewRetirement, which began as a consumer offering and in 2021 expanded to the enterprise, charges $120 per year for access to a suite of tools, calculators, recommendations and scenario comparisons and ~$1,500 per year for check-ins with a certified financial planner. In addition, NewRetirement sells a subscription-based private label version of its tools aimed at financial advisers.

Now, you might wonder, what makes NewRetirement different from startups like Retirable, which similarly provides an array of retirement planning tools and access to asset managers? Chen asserts that NewRetirement is one of the few — and perhaps only — financial planning platform that serves consumers as well as advisers and workplaces.

“Our core innovation is allowing anyone to create a plan with industrial-strength tools, enabling advisers to collaborate with the end user and making this available at scale through enterprise partners who bring it to their customers,” Chen said. “As more financial services companies see their offerings like investment management become commoditized, there’s huge value in helping clients and prospects think about their money holistically. By offering self-directed digital planning to clients versus starting with a human adviser, they can scale and serve any number of users, learn about them, help them make good decisions and position their products and services more effectively.”

Chen says that about 70% of NewRetirement’s revenue is enterprise presently, with the remaining 30% coming from consumer customers. The platform has 20,000 individual subscribers and “several” wealth management clients as well as “multiple” enterprise customers including Nationwide, which recently expanded an existing partnership with NewRetirement.

That momentum no doubt helped NewRetirement to cinch its Series A funding round this month.

The company raised $20 million in a tranche that brings its total raised to $20.8 million, led by Allegis Capital with participation from Nationwide Ventures, Northwestern Mutual Future Ventures, Plug and Play Ventures, Motley Fool Ventures and others. Chen says that the cash infusion will be used to expand 50-employee NewRetirement’s enterprise products, scale up onboarding, accelerate R&D efforts and build capacity to meet future demand.

“With this new capital, we will have three to four years of runway,” Chen said. “That gives us time to continue to scale our enterprise partnerships and enhance our product. What’s more, the current downturn is enabling us to bring in incredible talent. We have a strong team in place and will expand headcount further this year.”

More TechCrunch

Welcome back to TechCrunch’s Week in Review. This week had two major events from OpenAI and Google. OpenAI’s spring update event saw the reveal of its new model, GPT-4o, which…

OpenAI and Google lay out their competing AI visions

Expedia says Rathi Murthy and Sreenivas Rachamadugu, respectively its CTO and senior vice president of core services product & engineering, are no longer employed at the travel booking company. In…

Expedia says two execs dismissed after ‘violation of company policy’

When Jeffrey Wang posted to X asking if anyone wanted to go in on an order of fancy-but-affordable office nap pods, he didn’t expect the post to go viral.

With AI startups booming, nap pods and Silicon Valley hustle culture are back

OpenAI’s Superalignment team, responsible for developing ways to govern and steer “superintelligent” AI systems, was promised 20% of the company’s compute resources, according to a person from that team. But…

OpenAI created a team to control ‘superintelligent’ AI — then let it wither, source says

A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to…

VCs and the military are fueling self-driving startups that don’t need roads

When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying…

Deal Dive: Sagetap looks to bring enterprise software sales into the 21st century

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: OpenAI moves away from safety

After Apple loosened its App Store guidelines to permit game emulators, the retro game emulator Delta — an app 10 years in the making — hit the top of the…

Adobe comes after indie game emulator Delta for copying its logo

Meta is once again taking on its competitors by developing a feature that borrows concepts from others — in this case, BeReal and Snapchat. The company is developing a feature…

Meta’s latest experiment borrows from BeReal’s and Snapchat’s core ideas

Welcome to Startups Weekly! We’ve been drowning in AI news this week, with Google’s I/O setting the pace. And Elon Musk rages against the machine.

Startups Weekly: It’s the dawning of the age of AI — plus,  Musk is raging against the machine

IndieBio’s Bay Area incubator is about to debut its 15th cohort of biotech startups. We took special note of a few, which were making some major, bordering on ludicrous, claims…

IndieBio’s SF incubator lineup is making some wild biotech promises

YouTube TV has announced that its multiview feature for watching four streams at once is now available on Android phones and tablets. The Android launch comes two months after YouTube…

YouTube TV’s ‘multiview’ feature is now available on Android phones and tablets

Featured Article

Two Santa Cruz students uncover security bug that could let millions do their laundry for free

CSC ServiceWorks provides laundry machines to thousands of residential homes and universities, but the company ignored requests to fix a security bug.

1 day ago
Two Santa Cruz students uncover security bug that could let millions do their laundry for free

TechCrunch Disrupt 2024 is just around the corner, and the buzz is palpable. But what if we told you there’s a chance for you to not just attend, but also…

Harness the TechCrunch Effect: Host a Side Event at Disrupt 2024

Decks are all about telling a compelling story and Goodcarbon does a good job on that front. But there’s important information missing too.

Pitch Deck Teardown: Goodcarbon’s $5.5M seed deck

Slack is making it difficult for its customers if they want the company to stop using its data for model training.

Slack under attack over sneaky AI training policy

A Texas-based company that provides health insurance and benefit plans disclosed a data breach affecting almost 2.5 million people, some of whom had their Social Security number stolen. WebTPA said…

Healthcare company WebTPA discloses breach affecting 2.5 million people

Featured Article

Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Microsoft won’t be facing antitrust scrutiny in the U.K. over its recent investment into French AI startup Mistral AI.

1 day ago
Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Ember has partnered with HSBC in the U.K. so that the bank’s business customers can access Ember’s services from their online accounts.

Embedded finance is still trendy as accounting automation startup Ember partners with HSBC UK

Kudos uses AI to figure out consumer spending habits so it can then provide more personalized financial advice, like maximizing rewards and utilizing credit effectively.

Kudos lands $10M for an AI smart wallet that picks the best credit card for purchases

The EU’s warning comes after Microsoft failed to respond to a legally binding request for information that focused on its generative AI tools.

EU warns Microsoft it could be fined billions over missing GenAI risk info

The prospects for troubled banking-as-a-service startup Synapse have gone from bad to worse this week after a United States Trustee filed an emergency motion on Wednesday.  The trustee is asking…

A US Trustee wants troubled fintech Synapse to be liquidated via Chapter 7 bankruptcy, cites ‘gross mismanagement’

U.K.-based Seraphim Space is spinning up its 13th accelerator program, with nine participating companies working on a range of tech from propulsion to in-space manufacturing and space situational awareness. The…

Seraphim’s latest space accelerator welcomes nine companies

OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models. In a blog post on OpenAI’s press relations site, the company said…

OpenAI inks deal to train AI on Reddit data

X users will now be able to discover posts from new Communities that are trending directly from an Explore tab within the section.

X pushes more users to Communities

For Mark Zuckerberg’s 40th birthday, his wife got him a photoshoot. Zuckerberg gives the camera a sly smile as he sits amid a carefully crafted re-creation of his childhood bedroom.…

Mark Zuckerberg’s makeover: Midlife crisis or carefully crafted rebrand?

Strava announced a slew of features, including AI to weed out leaderboard cheats, a new ‘family’ subscription plan, dark mode and more.

Strava taps AI to weed out leaderboard cheats, unveils ‘family’ plan, dark mode and more

We all fall down sometimes. Astronauts are no exception. You need to be in peak physical condition for space travel, but bulky space suits and lower gravity levels can be…

Astronauts fall over. Robotic limbs can help them back up.

Microsoft will launch its custom Cobalt 100 chips to customers as a public preview at its Build conference next week, TechCrunch has learned. In an analyst briefing ahead of Build,…

Microsoft’s custom Cobalt chips will come to Azure next week

What a wild week for transportation news! It was a smorgasbord of news that seemed to touch every sector and theme in transportation.

Tesla keeps cutting jobs and the feds probe Waymo