SoFi Invest Review: Start Investing With $1

The Bottom Line: SoFi Invest is an online broker that allows you to do it yourself by choosing stocks, ETFs, and crypto, or let us build a portfolio for you with automated investing.

Pros & Cons

Although it’s mostly known as a student loan refinancing or a personal loan company, SoFi is now branching into the world of no-cost brokerages with SoFi Invest. 

No longer do you have to worry about your earnings being eaten up by trading fees (though you may need to pay expense ratios). 

Sure, it’s pretty cheap to trade with SoFi Invest, but is it worth it?

Let’s take a closer look at the brokerage company and whether it’s a good fit for your investing needs.

What is SoFi Invest?

Formerly known as SoFi Wealth, SoFi Invest is part of SoFi, founded in 2009 to provide student loan refinancing. 

It’s since branched out into other sectors and SoFi Invest is one of them. It’s regulated by the Securities and Exchange Commission and the Financial Industry Regulatory Authority (FINRA).

SoFi Invest also part of the Securities Investor Protection Corporation (SIPC) which provides up to $500,000 of protection in securities and up to $250,000 in cash.

SoFi Invest is considered safe because it is regulated by the top-tier financial authorities and provides a maximum of $500,000 investor protection including a $250,000 limit for cash as part of the SIPC protection scheme.

The automated investing or robo-advisor functions typically in line with other robo-advisors. Users answer a series of personal financial questions to determine risk profile.

The algorithms crunch the data to recommend a personalized portfolio best aligned with the goals and preferences.

Users can select the settings for auto-investing schedules and let the robo-broker handle the transactions including rebalancing.

How SoFi Invest Works 

There are two branches of SoFi Invest: Active Investing and Automated Investing.

SoFi’s Active Investing sector allows you to buy and sell shares of U.S. stocks with no commission fees. 

Currently you can only execute on a market order type — there aren’t other options such as limit time limit and stop-loss.

You can also purchase fractional shares of ETFs and certain stocks which the company calls StockBits.

How Stock Bits Work

How StockBits works is that you tell SoFi how much money you want to invest in a certain asset instead of the number of shares.

Then SoFi Invest will then execute on your request and deliver the fractional shares that will be able to meet the dollar amount you indicated.

SoFi Automated Investing

With SoFi’s Automated Investing, their robo-advisor works much in the same way as other competitors.

All you need to do to start is to answer a bunch of questions related to your financials so it can determine your risk profiles.

SoFi Invest’s algorithms will then take your information to recommend personalized portfolio options that are best in line with your goals and risk tolerance. 

It doesn’t have to be totally hands-off once you set your preferences — it is a hybrid robo-investing service in that there are human financial advisors ready to help you with questions related to your investment plan.

Think of it as a combination between a full-service wealth management products and completely automated investing tools.

You can also feel safe knowing that SoFi’s financial professions are fiduciary, meaning they’re required by law to act in your best interest.

Features & Benefits

Investing Platform

Investing Tools

Portfolio Options

Portfolio Rebalancing

SoFi Membership

Who SoFi Invest is Best For?

Since SoFi Invest offers two different types of investment strategies, it depends on what your goals are as to how it’s best for.

With Active Investing is best for those who are ready to dip their toes into more active trading but aren’t interested in a lot of bells and whistles.

It’s also best for those who want to learn on their own because you won’t find resources such as professional stock recommendations or more complex trading tools like candlestick charts. 

Advanced traders may want to steer clear of SoFi Invest for now since you can’t trade options, international stocks, mutual funds or cryptocurrency (though that’s supposedly changing soon). 

However, the lack of fees and low account minimums can be attractive to investors who aren’t ready to commit to investing a large amount just yet.

With Automated Investing, newbie investors can benefit, especially if you don’t have a lot of money to invest, considering you can open an account with as little as $1.

As you get more confident or have more funds, you have the option to set up automatic recurring payments. 

Plus, if you want to be more hands-off with your investing strategy, then SoFi’s robo-advisors can be the perfect fit.

All you really need to do is to select the type of portfolio right for you and SoFi Invest handles the rest.

SoFI Invest vs. Competitors

How to Open an Account

Signing up for SoFi is pretty quick — you might be able to do so in minutes.

All you need to do is to head over to their online application form and answer simple questions such as your name, mailing address and financial information then fund your account.

To start, you’ll be prompted to register for an account by entering your email address and creating a password. Then you’ll need to enter personal details such as:

If you opted for Automated Investing, it’ll suggest an investment strategy based on the above answers and ranges from conservative to aggressive.

You’ll also need to choose if it’s a taxable or retirement account and if it’s individual or joint.

Then you’ll need to fund it.

Should You Open A SoFi Invest Account?

SoFi can soon be a major contender when it comes to free brokerage accounts, especially if you want to invest in individual stocks or learn about trading. 

It has a bunch of options as well, from U.S. based stocks to ETFs from major markets.

Their platform is fairly intuitive and you can open an account pretty quickly. 

For now, their portfolio options seems limited and their research tools may be too basic for those who are more advanced trading journey.

Still, it’s worth looking into the brokerage and exploring your options — do your due diligence because you can lose money investing, especially if you’re allowing your emotions as a benchmark for buying and selling.