Tools for parents saving for their child's college education

Founder & CEO of UNest, Ksenia Yudina, joined Yahoo Finance Live to break down the most efficient way for parents to save for their child's college tuition.

Video Transcript


SEANA SMITH: Welcome back. April is Financial Literacy Month, and one fast-growing fintech app is offering families a pretty flexible way to save and also invest in their children's future. And we want to bring in Ksenia Yudina. She is the founder and CEO of UNest.

And Ksenia, it's great to have you on Yahoo Finance. One of the biggest concerns when I talk to my friends out there is just saving for their children's future and the best way to go about doing so. You're making it pretty simple. But first just stepping back and talking big picture, talk to us just about the importance of financial responsibility and when parents should start saving.

KSENIA YUDINA: Sure. I would say the sooner you start, the better, because you have so much potential due to compounding effects and tax benefits to actually create a pretty healthy financial nest for your child. But at the same time, I would say parents should not be discouraged if their kids are older, because it's never too late to start.

EMILY MCCORMICK: And I'm wondering just with your platform specifically, of course, offering custodial account services, what is the main benefit for users to actually go through UNest as opposed to going through something like a Fidelity, or a Vanguard, or another legacy brokerage account?

KSENIA YUDINA: Sure. So first of all, we make it, like, super accessible for parents. All you have to do is download the app on your mobile phone. You don't have to meet with a financial advisor and, like, learn about the different ways. We make it, like, very simple and fast.

Second, compared to traditional financial advisors that typically have very expensive fees and hidden commissions, our fee's very flat and transparent. It's only $3 per-- per parent a month. And in addition to the investment accounts, we actually provide parents two additional ways to save.

First is gifting. They can actually receive unlimited gifts from their friends and family directly into the child's account. And the second one is rewards from our brand partners. So actually, we partnered with [? 70 ?] brands, and every time the parent shops with those brands, they receive financial bonuses in the child's account.

SEANA SMITH: So you have closed three rounds of funding. Each of those rounds have been oversubscribed. What are your plans to scale your business going forward?

KSENIA YUDINA: Sure. So I look at UNest as a global opportunity, right. So that's why, like, we are currently in the hypergrowth mode, growing exponentially, which is great. Especially during the pandemic, parents are saving more than ever.

And saving and investing for their kids remains the number one priority. But what's interesting about the product, regardless of geography, regardless of ethnicity or gender or income level, the kids remain number one priority for parents. And what we're trying to help parents to do is build a better financial future for their children.

EMILY MCCORMICK: You know, one of the things we've been hearing about across the economy is that the savings rate, the personal savings rate has been increasing during the pandemic, especially after these latest rounds of stimulus checks. I'm wondering if UNest has actually seen an increase in deposits that kind of coincided with the disbursement of these stimulus checks? And is that something that you expect to continue going forward?

KSENIA YUDINA: Yes, absolutely. We actually have seen tremendous growth in additional deposits on the platform. It actually 6x'ed during the pandemic. And we've seen a lot of $1,400 deposits going into the accounts, so definitely there is a very high correlation with the stimulus checks.

And I would expect the trend to continue because, again, like, we as parents developed new habits. We adapted to the new technology and the new ways to save for our kids. And I would say that this behavior is expected to continue going forward.

SEANA SMITH: Who can open one of these? Is it anyone, essentially, with a smartphone? And what-- what is the fee structure?

KSENIA YUDINA: Yes, anyone can open the account as long as you have a child that you care about. So the grandparents can open the account, parents, aunts, uncles, like any-- you pretty much can open the account for any child in your life. And the fee structure, like I said, it's very affordable, very accessible and transparent. It's $3 per month, a membership fee that covers access to all the features and benefits that UNest has to offer, meaning you can get unlimited gifts from friends and family for birthdays, special occasions, all the holidays.

And you can get access to UNest rewards. You can get referral bonuses. You can get access to college calculator. And we're actually launching in April a new feature called UNest [? Yearn, ?] which is a financial literacy feature to help parents educate themselves and the kids about credit cards, life insurance, mortgages, and everything else.

EMILY MCCORMICK: And you already have about 250,000 parents and kids on your platform and expect to reach a million users by the end of this year. How have you been getting the word about UNest out? Where is this growth coming from?

KSENIA YUDINA: Yeah, that's a good question. We see a lot of parents finding us on popular blogs. We see a lot of partnerships work [INAUDIBLE] we actually partnered with some other fintechs. We also seen the double growth in organic accounts, meaning, like, parents just, like, simply go in the App Store or Google Play and search for terms like, you know, savings, college savings, saving for children, investments. So yeah, it's kind of a combination of factors.