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Look for a robo-advisor with low fees, high-quality past performance, strong leadership and customization options that suit your investment style. Based on those criteria, these seven robo-advisor platforms are the best options for 2023.
Best for Beginners
Best for Millennials
Best for Short-term
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Getting personalized advice from a financial advisor is too expensive for most investors, so some companies have developed a low-cost alternative to human financial advice through AI and algorithms: robo-advisors.
Robo-advisors offer automatic rebalancing of investment portfolios by looking at your risk tolerance and future stock market estimates. The best robo-advisors offer low fees and account minimums and include access to human financial advisors for customers when they need it.
Based on these criteria, we found the top seven robo-advisors for 2023.
Top 7 Best Robo-Advisor Platforms
- Betterment – Editors’ choice
- M1 Finance – Best for beginners
- SoFi Automated Investing – Best for millennials
- Acorns – Best for short-term investing
- Stash – Best for crypto
- Wealthfront – Best for tax-loss harvesting
- Vanguard Digital Advisor – Best for retirees
- Fidelity Go – Best for high net-worth
To decide which robo-advisors give you the most bang for your buck, we looked at fees, account minimums and features available to customers. We also considered a company’s history of success, length of time in business and current leadership.
Betterment – Editors’ Choice
Jon Stein founded Betterment in 2008 and served as the CEO until Sarah Levy took over in 2020. Since the beginning, Betterment has been committed to making investment advice accessible to all investors.
Betterment has served hundreds of thousands of investors and currently manages more than $32 billion in assets.
- Location: New York, NY.
- Accounts: Automated investing, crypto, Roth IRA, 401(k), high-yield cash account, checking and trusts.
- Fees: $4/month for most investors, or 0.25% annual fee for those investing $250/month or $20,000/year.
- Account minimum: No minimum.
Why we Chose Betterment: Betterment was one of the earliest robo-advising companies in the game and has maintained its position with excellent customer support and financial products and reasonable fees.
M1 Finance – Best for Beginners
Brian Barnes founded M1 Finance in 2015 to create a way for small-stakes investors to choose and manage their investments. Barnes started investing at just 10 years old and, since founding M1, has been committed to sharing his knowledge.
M1 Finance’s robo-advisor services have no account minimum, and one month of the plus subscription is free for new users.
- Location: Chicago, IL.
- Accounts: Brokerage accounts, retirement accounts, trusts, checking accounts and high-yield savings.
- Fees: $0 ($125/year for plus membership).
- Account minimum: No account minimum.
Why we chose M1 Finance: M1 has excellent portfolio customization options and a free account option available. It offers hands-off core portfolios that are pre-made or custom investment planning for more experienced investors.
SoFi Automated Investing – Best for Millennials
SoFi is a personal finance company run by a team of highly experienced financial experts and entrepreneurs, with the aim of creating a platform that helps everyday investors achieve financial freedom.
While SoFi offers various financial services, one of its strongest is its Automated Investing tool.
- Location: San Francisco, CA.
- Accounts: Brokerage account and automated investing.
- Fees: $0.
- Account minimum: $0.
Why we chose SoFi Automated Investing: SoFi Automating Investing has no fees and offers highly diversified portfolio options and high-quality financial planning tools.
Acorns – Best for Short-term Investing
In 2012, Acorns started as a company allowing customers to round up purchases to the nearest dollar and invest their spare change. Acorns’ goal was to create an easy way for Americans to participate in retirement planning and save during a time when most people had little saved up.
The company is also committed to providing its customers with educational resources to make the best decisions they can.
- Location: Irvine, CA.
- Accounts: Automated investing, retirement accounts and individual portfolios.
- Fees: $3-$5 per month.
- Account minimum: $0.
Why we chose Acorns: While all investment management tools on this list require little effort on the customer’s part, Acorns is almost entirely automated. From putting money into reinvesting dividends, Acorns is a great financial planning tool for those who want to set up an account and let it work by itself.
Stash – Best for Crypto
Stash is an investing app founded by Brandon Kreig in 2015. The company is on a mission to make investing easy and affordable for Americans.
Stash automated investing allows you to create smart portfolios that give you a diversified portfolio based on your risk profile.
- Location: New York, NY
- Accounts: Automated investing, smart portfolios
- Investor Type: All investors
- BBB Rating: Not Accredited
- Fees: $3-$9 per month
- Account Minimum: $0
Why we chose Stash: The reason is simple why we chose Stash. It makes investing easy and affordable for Americans with a user-friendly app.
Wealthfront – Best for Tax-Loss Harvesting
Andy Rachleff founded Wealthfront — a wealth management company — in 2008 as he wanted to level the playing field between accredited large-scale investors and everyday investors.
- Location: Palo Alto, CA.
- Accounts: Automated investing, retirement and 529 savings plans.
- Fees: 0.25% management fee.
- Account minimum: $500.
Why we chose Wealthfront: Wealthfront has the best tax optimization through tax-loss harvesting of any option on this list. The company has also delivered excellent APY in the past and is committed to excellent customer service.
Vanguard Digital Advisor – Best for Retirees
Vanguard Financial Services has served its customers since its founding in 1975. As one of the top personal investing firms in the United States, Vanguard’s Digital Advisor is a highly reputable investing option for investors of all sizes.
- Location: Valley Forge, PA.
- Accounts: Automated investing and customized portfolios.
- Fees: 0.20% advisory fee.
- Account minimum: $3,000.
Why we chose Vanguard Digital Advisor: Vanguard is a highly reputable company that has served its customers for nearly 50 years. It offers a free 90-day trial and has tons of customization options to suit every investor.
Fidelity Go – Best for High Net-Worth
Fidelity Investments has helped more than 40 million people with their investments since its formation in1945. Setting up a robo-advisor account with Fidelity is easy, and the company offers one-on-one talks with human financial experts when your account reaches $25,000.
- Location: Boston, MA.
- Accounts: Automated investing and mutual funds.
- Fees: 0% for those under $25,000 and 0.35% for over $25,000.
- Account minimum: $0 to open an account; $10 to invest.
Why we chose Fidelity Go: Fidelity Go is a great option for most investors because it has a high threshold before fees kick in. The company’s accounts are also highly accessible because of its low minimum and automatic rebalancing.
Robo-Advisor Investors Guide
Robo-advisors are an excellent option for anyone wanting a passive, hands-off investment option. Typically, robo-advisors are interactive asset allocation tools.
Essentially, robo-advisors will perform portfolio management on your behalf by deciding which kinds of assets you will have, such as exchange-traded funds, conventional stock options or riskier investments such as cryptocurrency.
When choosing a robo portfolio company, look for low fees, customer service options and asset class rebalancing.
Benefits of Robo-Advisors
- Low fees: Robo-advisors typically have lower fees than other kinds of investment advice.
- Accessibility: You can usually set up a new account with a robo-advisor in just minutes, and low account minimums mean that anyone can invest.
- Automatic portfolio rebalancing: Robo-advisors rebalance portfolios to include certain amounts of a different kind of stock, depending on investors’ preferences. Because this is automatic, it saves you from having to keep a close on your stock percentages.
- Passive investing: Most robo-advisors are easy to use — all you have to do is add money, take a survey on your preferences and let the algorithms do the rest.
- Low minimum investments: Many accounts will let you begin investing with as little as $1-$10 (rather than the thousands required to start with a human advisor).
- Great for new investors: Because robo-advisors do most of the heavy lifting, new investors may find them easier than more involved investing strategies.
Disadvantages of Robo-Advisors
- No human support: The lack of human support with a robo-advisor can be a significant drawback if you have nuanced preferences or questions about certain decisions regarding your account.
- No personalization: Aside from set parameters, robo-advisors cannot consider your investing preferences.
- Limited flexibility: If you have strong preferences or other edge case scenarios, robo-advisors will struggle to understand your specific strategy preferences.
How to Choose a Robo-Advisor
These are the primary things you should consider when choosing a robo-advisor:
Which Robo-Advisor Should You Choose?
The best robo-advisor for any individual depends on your investing style, risk tolerance and available funds. Generally, you should avoid premium plans if you’re planning on only investing a little bit of money.
On the other hand, if you’re investing large sums, look for companies that offer significant investor discounts and human advice. All options on this list are good options if you’re interested in using robo-advisors for portfolio management.
However, choosing the best for you will depend on due diligence and your long-term investing plans.
These are the most commonly asked questions about robo-advisor-based investing.
What is a robo-advisor?
A robo-advisor is a computer-based financial advisor that can help you direct your stock purchases.
How does a robo-advisor work?
Robo-advisors consider your financial goals and investing preferences through questionnaires or consultations and then analyze market trends through algorithms and AI to create a portfolio that works for you.
Is a robo-advisor worth the money?
Robo-advisors will likely help you invest better than you could on your own and are, therefore, almost certainly worth the money.
Is a robo-advisor good for beginners?
Yes, robo-advisors are a good way for beginners to get investment advice.