So I wanted to put together a distilled robo advisor comparison for you to check out. Largely because they are cool, but also because they are (potentially) a great step closer to financial democratization…which is also cool.
Robo advisors are software platforms that use digital algorithms and automation to offer financial planning and investment services to investors without direct human supervision.
Depending on the robo advisor, investors might be able to open accounts for free and start investing with a small amount of money.
The onboarding process usually involves the advisor asking a series of basic questions about your life and plans.
Betterment was one of the earliest robo-advisors, founded in 2008. This option provides investors with the ability to invest in a variety of different exchange-traded funds or ETFs of stocks and bonds.
Wealthfront offers ETFs in 11 different asset classes. In large accounts, individual stocks are also supported. However, it does not offer fractional shares.
They provide access to investing in individual securities and offer tax optimization strategies. It is better for high-net-worth investors who do not want to have to actively manage their accounts.