Though the investment markets continue to be scary, there’s some good news for anybody who is ready to put some money to work. Thanks to fierce competition among robo advisor firms, even beginning and small investors can now get top-notch portfolio advice and management at vanishingly low prices — in some cases, for free.
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Comparing 10 major robo advisors
SOFI AUTOMATED INVESTING
SoFi offers many free services to its robo advisor clients. There’s no minimum investment. It manages your portfolio for free. Expenses for the underlying ETFs in its core portfolio average just 0.03%. And you get free extras such as financial and career coaching. The firm gives investors five different mixes of stock and bond ETFs to choose from.
Robo Report says its SoFi portfolio has returned an annualized 3.5% over the past five years, above the average for this list. But SoFi does not offer much personalization or an ESG option. And both Condor’s Goldstone and Morningstar’s Arnott warn that SoFi, which has lost money for several years, may at some point either hike fees or ramp up marketing to push customers toward its more-profitable services, such as loans.
WEALTHFRONT
As one of the last pure robo services, Wealthfront boasts a low minimum investment of $500 and low fees (a management fee of 0.25% and underlying core portfolio funds with an average expense ratio of 0.08%).
It relies almost entirely on technology to manage its nearly 500,000 accounts. Wealthfront has only 12 human customer service representatives. “Wealthfront does not offer access to human advisers because from day one our clients have told us, ‘I pay you not to talk to me,’ ” says Alex Michalka, director of investments.
For those who want more than a basic index offering, Wealthfront allows investors to personalize their portfolio with hundreds of ETF choices. The service also automatically harvests tax losses daily.
Robo Report tracks three Wealthfront test portfolios and says that as of September 30, its original core portfolio notched a 4.4% annualized return over the past five years, which puts it at the top of robos we looked at for that time period. Newer Wealthfront portfolios — which have less energy exposure, for example — have posted lower returns.
7 apps to help you budget and save money in 2023
Mint
This personal finance app Mint by Intuit (the company behind TurboTax and QuickBooks) is user-friendly and free, making it one of the most popular on our list. If you like having a highly organized budget, Mint divides your purchases by category — from entertainment to pet supplies — and allows you to set spending limits. If you near your monthly budget, you’ll get an alert on your phone to help you slow down.
YNAB
If you want an app that syncs with your bank account and categorizes spending like Mint, YNAB (You Need A Budget) is another great pick. YNAB goes a step further and aims to change your relationship with money. If you want to tackle your spending while feeling less stressed and guilty about necessary expenses, this $99 per year multi-platform software is for you.
Qapital
If you want some help saving for a big purchase or event, try Qapital. This app helps you automate savings by rounding up purchases or setting a monthly goal. It also has budget and investment portfolio management tools. There are three plans — basic, complete and premium — that run from $3 to $12 per month.
Acorns
This investing app automatically rounds up your purchases to the nearest dollar. That extra money is then transferred into an Acorns investment account, which can help you build longer-term financial security. While Acorn funds can go up and down, you can customize your mix of conservative and aggressive investments.
Personal Capital
Personal Capital is another great investing tool that also helps you budget and track your spending. This free app can monitor your checking, savings and credit card accounts, as well as your 401(k) and mortgage.
Qoins
If you have an overwhelming debt that’s hanging over your head, Qoins makes it manageable to pay off. The app breaks up your debt payments into manageable small transfers so you can finally make a dent in your credit card bills or student loan payments.
Honeydue
Combining your finances with a significant other can be complicated. Honeydue aims to simplify the process. Both parties can sync bank accounts but you can share how much you show to your partner. Together you can create custom spending categories to manage your household budget.
