Reviewed in: Oct. 2022
Period considered: Aug. - Oct. 2022
The bottom line:
FutureAdvisor has great free tools, but higher fees than some competitors.
Unpaid non-client promotion
Pros & Cons
Offers free tools and advice.
Uses popular online brokers.
Provides robust human-advisor support.
High account minimum.
High management fee.
Compare to Other Advisors
with a balance over $20K or qualifying recurring deposit. Otherwise, $4/month.
Get $50 customer bonus
when you fund your first taxable Investment Account
Up to 1 year
of free management for new clients. Terms apply.
Get 6 months
of free wealth management for new clients. Must fund above $250,000 within 30 days of account opening. Terms Apply.
Paid non-client promotion
Paid non-client promotion
Paid non-client promotion
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FutureAdvisor is a robo-advisor with a bit of a twist: Several of the company’s services are free, including a comprehensive retirement analysis. The tool allows users to link their accounts and get specific recommendations tailored to their portfolio and goals. (Here's more on what a robo-advisor is.)
The company’s paid offering, which charges 0.50% as a management fee and requires a balance of $5,000 or more, is comprehensive investment management with automatic rebalancing, tax-loss harvesting and access to a team of financial advisors. Accounts are held with two well-established brokers, Fidelity or TD Ameritrade.
FutureAdvisor is best for:
Current Fidelity or TD Ameritrade account holders.
Hands-off investors who want access to a financial advisor.
FutureAdvisor at a glance
Account management fee
FutureAdvisor Premium costs 0.50%; free portfolio analysis.
Investment expense ratios
ETF expense ratios average 0.14% to 0.18%, according to data from 2019. (FutureAdvisor declined to provide updated 2020 information.)
Account fees (annual, transfer, closing)
No account fees, but customers may incur fees when moving accounts from other brokers to Fidelity or TD Ameritrade, including transaction fees on initial rebalance.
ETFs from up to 12 asset classes, according to data from 2019. (FutureAdvisor declined to provide updated 2020 information. Their website currently lists 14 ETFs, which it describes as a sample set from which they create portfolios.)
Accounts must be held at Fidelity or TD Ameritrade. Direct management of: • Individual and joint non-retirement accounts; • Roth, traditional, rollover and SEP IRAs.
Tax-loss harvesting on all taxable managed accounts; tax-efficient asset location among accounts.
Free on managed accounts.
Human advisor option
Clients have access to advisors via email and phone, Monday through Friday, 11:30 a.m. to 8 p.m. Eastern, according to data from 2019. (FutureAdvisor declined to provide updated 2020 information.)
Robust retirement planning tools, plus free service that offers detailed investment recommendations on linked accounts.
Bank account/savings account option
Customer support options (includes website transparency)
Email and phone, 11:30 a.m. to 8 p.m. Eastern, according to data from 2019. (FutureAdvisor declined to provide updated 2020 information.)
Where FutureAdvisor shines
Free tools and advice: FutureAdvisor has two main offerings: a free portfolio analysis service, and FutureAdvisor Premium, which is direct management of investments and carries a 0.50% management fee.
The DIY investor who wants a second opinion will love FutureAdvisor for the company’s free, personalized recommendations, which can be used on any account held at any broker. This platform analyzes your portfolio and gives you free trade recommendations based on modern portfolio theory, the same investing methodology used by the bulk of robo-advisors. You can then initiate trades through your online broker.
FutureAdvisor’s free service will also alert you of the need to rebalance. It doesn’t provide tax-loss harvesting opportunities to free customers, as they can be complicated to execute. However, tax-loss harvesting is included on all FutureAdvisor Premium accounts.
Use of popular online brokers: For FutureAdvisor Premium, accounts must be held at TD Ameritrade or Fidelity. If your accounts are already at one of those brokers, there is no need to move them; you’ll simply give FutureAdvisor management rights and the company will be able to trade on your behalf. That means you get all the perks of a robo-advisor at a trusted online broker, and giving the service a try is virtually risk-free, without the need to transfer funds.
If your accounts are elsewhere, this is potentially a disadvantage, as you’ll need to move them to one of those brokers and there may be costs related to closing out your other account. However, the company will help you do it (and the need to move accounts is typical of robo-advisors), and assets can be transferred in kind.
Where FutureAdvisor falls short
Management fee: The cost here is high when compared with other robo-advisors: FutureAdvisor Premium carries an annual fee of 0.50%, which is in addition to investment expenses. The company notes that customers may also occasionally incur transaction fees, though it prioritizes the use of commission-free funds.
Is FutureAdvisor right for you?
FutureAdvisor is worth a test drive for its free offerings alone: The account analysis with rebalance reminders can give you valuable insight into how to manage your own portfolio.
It’s also a good fit for clients who have accounts at Fidelity or TD Ameritrade and who don’t want to transfer funds in order to take advantage of a robo-advisor. Outside of that, other advisors may provide a similar level of service and account management for a lower management fee and a lower account minimum.