Margaret J Hartigan of Marstone On How They Are Helping To Promote Financial Inclusion

An Interview With Jason Hartman

An increase in financial inclusion benefits everyone, because it leads to an increase in savings, capital and investment, which in turn, raises overall economic growth.

Most of us take it for granted that we can open a bank or a credit card. But the truth is, according to the World Bank, close to one-third of adults — 1.7 billion — are still unbanked, and have no access to a transaction account. About half of unbanked people include women in poor households in rural areas or out of the workforce. What can be done and what is being done to promote more financial inclusion? To address this Authority Magazine started a new series about Companies Helping To Promote Financial Inclusion. As part of this series I had the pleasure to interview Margaret J. Hartigan.

Inspired to help demystify finance for investors and enable institutions to better engage and retain clients, Margaret Hartigan founded Marstone, a Rhode Island-based digital wealth platform available for financial institutions to white-label and offer to their clients.

Prior to starting Marstone, Margaret was a top quintile financial advisor for 10 years in the Global Wealth Management Group at Merrill Lynch, split between New York and San Francisco. A graduate of Brown University, Margaret is an active leader in the alumni and major development efforts at both Brown University and Phillips Exeter Academy. She’s a member of the Milken FinTech Advisory Committee, serves on the NPX advisory board, and is a former trustee of Sonoma Academy, in Santa Rosa, California.

Thank you so much for doing this with us! Before we dig in, our readers would like to ‘get to know you’. Can you tell us a bit about how you grew up?

I grew-up in New Hampshire and had a very active childhood playing lots of sports from skiing to soccer. I am the eldest of five children of divorced parents. As such, my aunts, uncles and grandparents played a critical role in my upbringing — a very GenX story.

Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?

There are many. I remember reading Barbara Corcoran’s Use What You’ve Got, and Other Business Lessons I Learned from My Mom, a long time ago and loving her story. What I particularly loved about the book was her creativity, tenacity and vulnerability. Corcoran is now a huge star in addition to an incredible business woman. It’s just so fabulous to see her still dreaming, grinding, and making things happen. I think that belief in herself and her willingness to keep showing up and putting herself out there, especially after she got knocked down, probably planted a seed in me a long time ago.

The other book that really resonated was Let My People Go Surfing: The Education of a Reluctant Businessman, by Yvon Chouinard. It captures his incredible journey and how he has yolked his business with his beliefs and values. I may not agree with all of his views, but with many I do.

Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?

“Always forward, rarely straight.” It’s just one of the keys to life — you have to get back up and keep showing up and realize you are not always in control. Every day there is something that goes sideways or happens that is unexpected — unexpected is not always bad, by the way.

How do you define “Leadership”? Can you explain what you mean or give an example?

I think it means being of service. Yes, I set a direction and vision for the company in terms of product and strategy, but none of that matters or can happen without people. Colleagues, partners, investors, clients, end clients — it’s all about people.

Can you share the most interesting story that happened to you since you began your career?

Yes, I became a founder and CEO of a financial technology company. That is interesting and fascinating to me. I’m teasing, but not completely. In college, I was a humanities major, and before Marstone, I was a financial advisor at Merrill Lynch for twelve years. In the wake of 2008, I realized our industry faced three challenges: a lack of financial literacy amongst retail clients, old and complicated systems that helped bankers and advisors work with our clients, and a perfect storm of aging advisors and clients and no means of managing and serving the next generation who were going to inherit this wealth. I found myself thinking (obsessing) about what a new model might look like that served all three stakeholders: client, advisor/banker, and institution. Eventually, I felt like I had to do it. It felt like a calling, but it was also terrifying. I suppose that is the most interesting thing — I gave myself a shot and I took a bet on me. That’s really, really terrifying. It’s hard to overcome the voices in your head and maybe those of your friends and family who caution you or doubt you.

Ok, thank you for all that. Now let’s move to the main focus of our interview. Let’s start with a basic definition so that all of our readers are on the same page. What exactly is Financial Inclusion?

“Financial Inclusion” means to offer banking and financial services equally to everyone regardless of their income or savings. In doing so, people have the ability to access affordable and timely banking products and services.

What does it mean to be “unbanked”?

“Unbanked” refers to individuals who do not use banks or financial institutions to any extent, including checking accounts, savings accounts, credit cards and loans. Instead, they oftentimes prefer to manage their finances through cash transactions or prepaid debit cards.

For the benefit of our readers, can you explain some of the typical reasons why a person might be unbanked? Why can’t they just walk into the local bank and open an account? Why can’t they simply open an account online?

There are a variety of reasons why there are still millions of Americans who are unbanked. Many of those individuals may not have the cash flow required, as banking services can be too expensive with minimum deposit requirements, account fees and other upfront costs. Additionally, they may not have access to community-wide financial education pointing them in the right direction.

Can you tell our readers a bit about your work to promote Financial Inclusion? Without saying names, can you share a story about a person who was helped by your initiative?

It has been a major goal of mine to make financial inclusion and education accessible to everyone. As I mentioned, while an advisor at Merril Lynch, I realized the sheer number of people who lacked financial literacy and the disconnect of financial institutions to efficiently engage and serve a new generation of investors. Professional wealth management at the time had only been available to people who had enough money to invest through a financial advisor. That’s why I founded Marstone — I worked tirelessly to forge partnerships that ensured low minimum investment requirements so world-class portfolios can be available to customers of all financial means.

I also believe that in order to create a product that’s inclusive of a diverse customer base, a company must also be comprised of an equally diverse employee group. That’s why I made sure we placed an emphasis on inclusivity from the beginning. Half of Marstone’s senior leadership is female, with women and people of color holding other key leadership positions throughout the organization. Also, out of our many interns over the years, 70% have been women and 40% have been people of color — with 30% going on to work for Marstone in a full-time or part-time capacity.

This may be obvious to you, but it will be helpful to spell this out. Can you articulate to our readers a few reasons why it is so important for businesses to promote financial inclusion?

An increase in financial inclusion benefits everyone, because it leads to an increase in savings, capital and investment, which in turn, raises overall economic growth.

Challenges associated with the pandemic have amplified the critical need for financial inclusion. Recent findings have shown that during Covid, nearly 14% of Americans have drained their emergency savings. Through opening up automated products like Marstone’s platform to a much wider and diverse customer base, it’s one way for people to grow wealth quicker than savings alone and get back on their feet.

Ok. Here is the main question of our discussion. You are an influential business leader. Can you please share your “5 Steps Businesses Should Take To Promote Financial Inclusion”. Kindly share a story or example for each.

One of the most important things a business can do is make sure it offers benefits to all of its employees. As a small business leader, I know benefit expenses are growing significantly and that many employers wish they could do more for their employees, but having something with intentions to add to it over time is critical. Of course, tied to this is having internal and external resources available for team members to ask questions and get help. Lastly, creating opportunities for people to learn from internal and external leaders on how they navigated their career is really important. A couple of summers ago we invited members of our Board and leaders of a few organizations to meet and work with our summer interns. It was a great experience for both our interns and the leaders. Our interns gained confidence presenting to high ranking executives, but they also learned that each of them didn’t go straight to the top and, in many cases, started from humble beginnings.

You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

At Marstone, we are working on developing an interactive financial wellness and planning platform. It’s a passion of all of our teams and a platform we are so excited to bring to market. The tool is designed to help users explore what they would like to achieve, be it going to college, buying a car, or starting one’s first savings account. It’s highly visual and does not inundate the user with financial jargon or complicated graphs. It’s my goal that it helps people see themselves in their money and their choices so they can begin visualizing and planning their dreams. My even bigger dream is that we can configure a version for high school students and get it into school curriculums. We need to reach people earlier. Most people do not learn the lessons of compounding interest until they are on the wrong side of credit cards. How fantastic if people could see the benefits of compounding interest when it helps you grow savings and investments?

Is there a person in the world, or in the US, with whom you would like to have a private breakfast or lunch, and why? He or she might just see this, especially if we tag them. :-)

Oh, there are so many. Well, former Chancellor Angela Merkel would be incredible. I finished college in Prague and did an independent study with the Eastern Europe correspondent of The Economist and many leaders of the Velvet Revolution. Chancellor Merkel’s personal journey and the myriad crises (financial crisis, immigration, Covid19, etc.) she navigated her country through are fascinating to me.

Clearly, I’d love to sit down with Barbara Corcoran or Yvon Chouinard would be fabulous, too.

How can our readers further follow your work online?

Feel free to check out our website www.marstone.com, Twitter @MarstoneInc, and LinkedIn page https://www.linkedin.com/company/marstone-inc/.

Thank you for your time, and your excellent insights! We wish you continued success.