Advertiser Disclosure

How Betterment, Wealthfront and Wealthsimple Compare

May 8, 2018
Advisors, Investing
How Betterment, Wealthfront and Wealthsimple Compare
At NerdWallet, we adhere to strict standards of editorial integrity to help you make decisions with confidence. Some of the products we feature are from our partners. Here’s how we make money.
We adhere to strict standards of editorial integrity. Some of the products we feature are from our partners. Here’s how we make money.

The growing popularity of robo-advisors means sifting through more offers to automate your investment savings, but which one is the best for you?

Betterment, Wealthfront and Wealthsimple are three of the best robo-advisors, but each company differentiates its offerings in some notable ways.

Some factors that may make a difference in your choice: How much money do you have to start with? Is socially responsible investing, or being able to invest according to your beliefs, important to you? Do you want to also have access to a human financial advisor? (We’ve written a primer if you want to learn more about how robo-advisors work.)

At a glance

bettermentsmall


Account management fees: 0.25% to 0.40%, depending on plan.

Account minimum: $0.

Account types: Individual and joint nonretirement accounts; trusts; Roth, traditional, SEP and rollover IRAs.

Portfolio: ETFs from up to 12 asset classes. Socially responsible investing portfolio available.

Customer support: Phone and email support and live chat. All customers can consult a financial advisor via in-app messaging. Betterment Premium customers get access to team of financial advisors via phone.

Promotion: Up to one year of free management with qualifying deposit.

Wealthfront



Account management fees: First $5,000 managed free for NerdWallet readers; 0.25% after that.

Account minimum: $500.

Account types: Individual and joint nonretirement accounts; trusts; Roth, traditional, SEP and rollover IRAs; 529 college savings plan

Portfolio: ETFs from 11 asset classes.

Customer support: Phone and email support.

Promotion: First $5,000 managed free for NerdWallet readers.

wealthsimplesmall



Account management fees: 0.40% to 0.50%, depending on plan

Account minimum: $0 for Wealthsimple Basic; $100,000 for Wealthsimple Black.

Account types: Individual and joint nonretirement accounts; trusts; Roth, traditional, SEP and rollover IRAs.

Portfolio: ETFs from 16 asset classes. Socially responsible and halal investing portfolio available.

Customer support: Phone and email support. All customers can consult a financial advisor by phone.

Promotion: NerdWallet readers who fund a new account with $1,000 in first 30 days get a $50 account credit.

Account management fees
0.25% to 0.40%, depending on plan.First $5,000 managed free for NerdWallet readers; 0.25% after that.0.40% to 0.50%, depending on plan.
Account minimum
$0 for Betterment Digital; $100,000 for Betterment Premium.$500$0 for Wealthsimple Basic; $100,000 for Wealthsimple Black.
Account types
  • Individual and joint nonretirement accounts
  • Roth, traditional, SEP and rollover IRAs
  • Trusts
  • Individual and joint nonretirement accounts
  • Roth, traditional, SEP and rollover IRAs
  • Trusts
  • 529 college savings plans
  • Individual and joint nonretirement accounts
  • Roth, traditional, SEP and rollover IRAs
  • Trusts
Portfolio
Exchange-traded funds from up to 12 asset classes. Socially responsible investing portfolio available.ETFs from 11 asset classes.ETFs from 16 asset classes. Socially responsible and halal investment offerings too.
Customer support options
  • Phone and email support; live chat.
  • All customers can consult a financial advisor via in-app messaging.
  • Betterment Premium customers get access to team of financial advisors via phone.
  • Phone and email support.
  • Phone and email support.
  • All customers can consult a financial advisor by phone.
Promotion
Up to one year of free management with qualifying deposit.First $5,000 managed free for NerdWallet readers.Fund a new account with $1,000 in first 30 days get a $50 account credit.

All robo-advisors use passive investing strategies, which studies show often lead to higher overall returns. Better yet for the consumer, you can start investing with a robo-advisor without knowing much about how markets work.

Betterment

Betterment requires no minimum deposit to begin investing, and its 0.25% management fee is one of the most competitive in the industry. For those who want to invest in companies whose business practices align with your values, Betterment offers a socially responsible portfolio.

Betterment has a full range of tools for goal-based savings. The firm also offers the purchase of fractional shares so you can invest even if you don’t have enough cash to buy a full share. If online advice from human advisors is important to you, Betterment lets you send messages from within its mobile app to its team of financial advisors, who will answer within one business day. (Betterment’s premium tier allows unlimited phone calls with advisors, but the service requires a minimum balance of $100,000 and bumps its management fee to 0.4%.)


NerdWallet is a free tool to find you the best credit cards, cd rates, savings, checking accounts, scholarships, healthcare and airlines. Start here to maximize your rewards or minimize your interest rates. Kevin Voigt

QUICK FACTS

  • Management fee: 0.25% to 0.4%, depending on plan
  • Account minimum: $0
  • Promotion: Up to one year of free management with a qualifying deposit
Get started on Betterment's secure site

Betterment offers tax-loss harvesting, but it has no direct-indexing tool, which can further help savings for investors with taxable accounts. Also, the company doesn’t support 529 college savings.

» Read NerdWallet’s full Betterment review

Wealthfront

Wealthfront is the only one of the three that requires a minimum account balance, but the amount is low ($500). Its 0.25% management fee is low, too, and NerdWallet readers can get their first $5,000 managed for free. Wealthfront’s Path tool helps with financial planning, be it for buying a house, retirement, college or general savings goals. It’s also one of the few robo-advisors to manage 529 college savings plans.

For accounts with balances of $100,000 or more, Wealthfront offers tax-optimized direct indexing, a more powerful tool for tax-loss harvesting.


NerdWallet is a free tool to find you the best credit cards, cd rates, savings, checking accounts, scholarships, healthcare and airlines. Start here to maximize your rewards or minimize your interest rates. Kevin Voigt

QUICK FACTS

  • Management fee: 0.25%
  • Account minimum: $500
  • Promotion: NerdWallet readers get first $5,000 managed for free
Get started on Wealthfront's secure site

Wealthfront doesn’t offer access to advisors, a downside for customers who want occasional human help with investing, nor does it offer the purchase of fractional shares. Also, Wealthfront requires you keep a cash balance equivalent to the estimated fees you’ll pay over the next year.

» Read NerdWallet’s full Wealthfront review

Wealthsimple

Wealthsimple has a robust offering for socially responsible investing, as well as halal investing products that comply with Islamic law. Wealthsimple earns its name with its beginner-friendly interface and gives all customers access to financial planners. And there’s no minimum required to open an account.

The firm’s management fee range of 0.4% to 0.5%, depending on your account balance, is higher than those at Wealthfront and Betterment.


NerdWallet is a free tool to find you the best credit cards, cd rates, savings, checking accounts, scholarships, healthcare and airlines. Start here to maximize your rewards or minimize your interest rates. Kevin Voigt

QUICK FACTS

  • Management fee: 0.4% to 0.5%
  • Account minimum: $0
  • Promotion: $50 cash bonus for users who deposit at least $1,000 in first 30 days
Get started on Wealthsimple's secure site

Aside from its higher management fees, some consumers may find Wealthsimple’s offering too streamlined: Those who want retirement-planning tools, calculators or a strong investor-education experience won’t find that here.

» Read NerdWallet’s full Wealthsimple review

Final look

Choosing among the best advisors means looking at what features, functions and fees best suit your investing needs. Regardless of which you select, the winning choice is the decision to invest toward building your future wealth.



Best for:
No minimum / Access to financial advisors / Socially responsible investing / Fractional shares

Falls short:
No direct-indexing tool / No 529 plan


Best for:
Digital-only management / Nonretirement (taxable) accounts / Saving for college

Falls short:
No human advisors / No fractional shares / Cash balance requirement


Best for:
No minimum / Access to financial advisors / Socially responsible investing / Halal investing portfolio

Falls short:
High account management fees / Lack of personal finance tools
Best for
  • Access to financial advisors
  • Socially responsible investing
  • Fractional shares
  • Digital retirement-planning tool
  • Taxable accounts
  • Saving for college
  • Access to financial planners
  • Socially responsible and halal investing
  • Fractional shares
Falls short
  • No direct-indexing tool
  • No 529 plan
  • No human advisors
  • No fractional shares
  • Cash balance requirement
  • High management fees
  • Few planning and educational tools

 

About the author