4. Best Robo advisors

Aren’t All Robo-Advisors the Same?

The differences among robo-advisors might seem minor to the casual reader, but in reality, they’re not. You have a choice when it comes to:

  • Minimum Deposit: With some firms, you can start out with nothing, while others require sizable amounts to invest.
  • Annual Fees: Be aware of hidden costs and fees for the ETF a robo-advisor purchases on your behalf.
  • Asset Allocation: Asset allocation can vary quite a bit based on your age and how you answer the service’s risk assessment questions.
  • Account Type Support: Does the robo-advisor offer individual or joint accounts, IRAs, etc.? Similarly, can it assist with your 401(k) plan?
  • Automation: Some services are 100% automated vs. human-assisted advice.
  • Tax Optimization: Services such as tax-loss harvesting can help at tax time.
  • Custody of Funds: Managed either by you, in which case the robo-advisor gives trading advice, or directly by the firm.
  • Management of Assets: Manage all your assets or just a portion.
  • End Goal: Retirement-only or other goals (e.g., college education).

Leave a Reply

Your email address will not be published. Required fields are marked *