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.)
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 at a glance
| Account minimum | $0 for Betterment Digital, $100,000 for Betterment Premium. |
| Account management fee | 0.25% for Betterment Digital, 0.40% for Betterment Premium. |
| Investment expense ratios | ETF expense ratios range from 0.07% to 0.17%. |
| Account fees (annual, transfer, closing) | None. |
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| Automatic rebalancing | Free on all accounts. |
| Human advisor option | Betterment Digital doesn't offer access to financial advisors. However, for a fee, you can buy an advice package that includes a consultation with an advisor. Betterment Premium customers get unlimited telephone calls with a team of certified financial planners. |
| Tools | Numerous tools and calculators to help set goals, choose the right accounts and make money decisions. |
| Savings account/cash management option | High-yield savings with FDIC insurance up to $1 million and unlimited transfers. |
| Customer support options (includes website transparency) | Phone and email support Monday-Friday 9 a.m.-6 p.m. Eastern time. Email only on Saturdays and Sundays 11 a.m.-6 p.m. Eastern time. |
| Promotion | NerdWallet users get up to 12 months of free management: deposits of $15,000 to $99,999 get one month free; $100,000 to $249,999 get six months free; $250,000+ get one year free. If you refer a friend and that person funds an account, you both get $5,000 managed free for one year. |
» Read NerdWallet’s full Betterment review
Wealthfront at a glance
| Account minimum | $500 |
| Account management fee | 0.25% (first $5,000 managed free for NerdWallet readers). |
| Investment expense ratios | ETF expense ratios average 0.08%. Portfolios that include the Wealthfront Risk Parity Fund may have an overall expense ratio of 0.11%. |
| Account fees (annual, transfer, closing) | None. |
| Portfolio mix | ETFs from 11 asset classes (portfolios generally consist of 6 to 8). Individual stocks held in larger accounts. |
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| Automatic rebalancing | Free on all accounts. |
| Human advisor option | None. |
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| Savings account/cash management account | High-yield savings account with up to $1 million in FDIC insurance and no fees. |
| Customer support options (includes website transparency) | Phone support Monday-Friday 10 a.m. to 8 p.m. Eastern; email support. |
| Promotion | NerdWallet readers get free management on the first $5,000 invested. Refer a friend and you both get an extra $5,000 managed free. |
» Read NerdWallet’s full Wealthfront review
Wealthsimple at a glance
| Account minimum | $0 |
| Account management fee | 0.5% for balances $99,999 and less. 0.4% on balances above $100,000. |
| Investment expense ratios | 0.09% - 0.12% on standard portfolios. 0.25% on SRI portfolios. |
| Account fees | None |
| Portfolio mix | Between 6-10 ETFs covering up to 10 asset classes in standard portfolio. Around 50 individual stocks for halal portfolios and 6 ETFs in SRI portfolio. |
| Accounts supported | Taxable individual and joint accounts; IRAs (traditional, Roth, SEP); trust and custodial (UTMA and UGMA). |
| Tax strategy | Free for all customers; available by request. |
| Automatic rebalancing | Proprietary threshold-based rebalancing methodology. Free on an as-needed basis. |
| Human advisor option | All customers have access to a team of financial advisors. Wealthsimple Generation clients get two dedicated advisors. |
| Tools | Free portfolio review; simple retirement calculator. |
| Savings account/cash management account option | Wealthsimple Smart Savings, with return above 1% net of management fee. |
| Customer support options (includes website transparency) | Phone or email Monday-Thursday 8 a.m.-8 p.m., Friday 9 a.m. - 6 p.m. Eastern. |
| Promotion | First $10,000 managed free for one year for NerdWallet readers (new clients only). Free consultation for new customers. |
» 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. You can also compare these three against others among the best robo-advisors.
Regardless of which you select, the winning choice is the decision to invest toward building your future wealth.
