Merrill Edge Guided Investing Review 2021: Pros, Cons and How it Compares

Merrill Edge Guided Investing stands out for human portfolio management, and current Merrill and Bank of America customers will appreciate its rewards program. But the management fee is higher than many robo-advisors.
Alana BensonOct 5, 2021

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Our Take

4.0

NerdWallet rating 

The bottom line: Merrill Edge Guided Investing requires a $1,000 minimum investment and charges an annual management fee of 0.45%. If you’re looking for access to a human advisor along with your investing account, Merrill offers that for a steeper fee.

Merrill Edge Guided Investing

Merrill Edge Guided Investing

Fees

0.45%

management fee

Account Minimum

$1,000

Promotion

None

no promotion available at this time

Pros & Cons

Pros

  • Human portfolio management.
  • No proprietary ETFs.
  • Access to human advisors (for a higher fee).

Cons

  • High management fee.
  • No tax-loss harvesting.

Compare to Other Advisors

SoFi Automated Investing
Vanguard Digital Advisor
Betterment
NerdWallet rating 
NerdWallet rating 
NerdWallet rating 
Fees

0%

management fee

Fees

0.15%

per year (approximately)

Fees

0.25%

management fee

Account Minimum

$0

Account Minimum

$0

Account Minimum

$0

Promotion

Free

career counseling plus loan discounts with qualifying deposit

Promotion

No advisory fees

your first 90 days of Vanguard Digital Advisor investment management (Enrollment requires a Vanguard account with a minimum of $3,000)

Promotion

Up to 1 year

of free management with a qualifying deposit

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Full Review

Where Merrill Edge Guided Investing shines

Easy integration: Merrill Edge makes it enticing for existing customers or Bank of America clients to get on board with its investing service. The Preferred Rewards program reduces management fees, increases interest rates, gives discounts on auto loans and increases credit card rewards as account balances grow.

Human management: Merrill Edge is a robo-advisor with a twist. It offers human portfolio management in a robo-advisor format.

Where Merrill Edge Guided Investing falls short

Many robo-advisors offer more for less: More tax strategy, more advisor access, lower account minimums and management fees.


Merrill Edge Guided Investing is best for:

  • Hands-off investors.

  • Investors who seek human oversight for their investments.

  • Existing Merrill Edge or Bank of America customers.

Merrill Edge Guided Investing at a glance

Account minimum

$1,000.

Account management fee

0.45%.

Investment expense ratios

Core ETF portfolios: 0.05% to 0.09%. Socially responsible portfolios: 0.15% to 0.19%.

Account fees (annual, transfer, closing)

$49.95 full account transfer and closeout fees.

Portfolio mix

Portfolio mix is well-diversified but lacks exposure to non-market correlated assets like REITs and commodities.

Clients can request restrictions on specific ETFs or mutual funds.

Socially responsible portfolio options

Clients can choose to invest in an ESG portfolio for no extra fee and request restrictions on certain ETFs.

Accounts supported

Individual, joint and custodial taxable accounts.

Roth, traditional, SEP and SIMPLE IRAs.

Clients may roll over assets into a traditional IRA or another retirement account.

Tax strategy

This service doesn't include tax-loss harvesting or other active tax-management strategies, but does offer 10 "tax aware" portfolios to clients whose situation warrants it.

Automatic rebalancing

Free and as needed. Rebalancing is performed by Merrill's Chief Investment Office.

Human advisor option

None. Advisor access is available at Merrill's Guided Investing with an Advisor tier (see more information below).

Bank account/cash management option

Cash management account with an interest rate of 0.01%.

Customer support options (includes how easy it is to find key details on the website)

24/7 support via phone, online, mobile and chat, or in person at select locations.

More details about Merrill Edge Guided Investing's ratings

Looking for access to financial advisors? Jump to Merrill Edge Guided Investing with Advisor.

Account minimum: 4 out of 5 stars

Merrill Edge Guided Investing has a $1,000 account minimum. Many competitors have a $0 minimum. If you’re starting to invest with a smaller amount of money, you may want to look elsewhere.

Account management fee: 2 out of 5 stars

Like its account minimum, Merrill’s account management fee is higher than most: 0.45% compared to the more typical robo-advisor fee of around 0.25% or less. That means for a $10,000 account balance, you’ll pay $45 a year in fees.

Merrill Edge Guided Investing accounts also may qualify for the company’s Preferred Rewards program, which offers perks to clients with an eligible Bank of America checking account and three-month average combined balances of $20,000 or more in qualifying Merrill Edge and/or Merrill Lynch investment accounts or Bank of America deposit accounts.

The benefits of the program increase as combined balances grow and include a reduced management fee on Guided Investing accounts. The 0.45% fee drops to:

  • 0.40% if your combined balance is $20,000 to $49,999;

  • 0.35% for combined balances of $50,000 to $99,999;

  • 0.30% for balances of $100,000 or more.

Unfortunately, 0.30% is still more than many robo-advisors charge.

Investment expense ratios: 5 out of 5 stars

In addition to a management fee, most robo-advisors pass on the expense ratios, or the fees charged by the funds themselves, to the consumer. Merrill’s expense ratios are quite low, ranging from 0.05% to 0.09% for its core portfolio.

Account fees: 4 out of 5 stars

We prefer to see no fees, but Merrill’s Guided Investing Fees are fairly standard. There is a $49.95 full account transfer fee and a closeout fee (for traditional and Roth IRAs) that also costs $49.95.

Portfolio mix: 3 out of 5 stars

Robo-advisor portfolios are typically managed by computer algorithms; that’s the “robo” part. Merrill Edge Guided Investing is built on similar technology but also integrates human oversight. Investors are matched to a recommended investment strategy, or asset allocation, based on the results of an onboarding questionnaire designed to peg their risk tolerance and goals, but portfolios are actually managed by people at the firm.

Many brokers see a double opportunity in the robo-advisor movement: They can charge a management fee for each portfolio and use their own funds within those portfolios, also collecting the expense ratio on these funds.

But Merrill Edge doesn’t have any proprietary ETFs, nor does Merrill Lynch or parent company Bank of America, so ETFs are pulled from a variety of sources.

The service selects from about 25 different portfolios based on risk tolerance, time horizon and allocation and offers portfolios that focuses on socially responsible investments.

Socially responsible portfolio options: 4.5 out of 5 stars

Merrill Edge Guided Investing offers more flexibility and customization within their managed portfolios than most robo-advisors, including within its socially responsible portfolio option. Merrill uses a specific framework including avoiding investments that have negative social or environmental effects and supporting positive ones, and Merrill lets you customize your investment strategy so that you can support particular issues you care about. Merrill's socially responsible portfolios have expense ratios between 0.15% and 0.19%.

Accounts supported: 3 out of 5 stars

Merrill supports individual, joint and custodial taxable accounts, Roth, traditional, SEP and Simple IRAs. Clients may roll over assets into the traditional IRA or other retirement account.

Tax strategy: 2 out of 5 stars

This service doesn't include tax-loss harvesting or other active tax-management strategies, but does offer 10 "tax aware" portfolios to clients whose situation warrants it. Tax-loss harvesting is an investment strategy that can significantly reduce capital gains taxes, and it is offered for free by several of Merrill’s competitors.

» Want to check out other providers? Here are our top picks for best robo-advisors.

Automatic rebalancing: 5 out of 5 stars

Rather than a set rebalancing frequency, rebalancing needs are determined by Merrill’s Chief Investment Office. Those rebalancing needs can include changes in target asset allocation and flows into and out of the account. That means rebalancing isn’t automatic, but it does have a human touch. There are no additional fees for rebalancing.

Human advisor option: 1 out of 5 stars

Merrill Edge Guided Investing’s 0.45% fee tier does not offer access to a human financial advisor.

If you’re looking for advice from a financial advisor, jump to Merrill Edge Guided Investing with Advisor.

Savings account/cash management options: 2 out of 5 stars

Merrill partners with Bank of America to offer a cash management account with an interest rate of 0.01%. Compared to providers that offer a high-yield savings account, this is quite low. If you are able to participate in the Preferred Rewards program, that interest rate can increase depending on your qualifying account balance (qualifying combined balances of  your Merrill investment accounts and Bank of America deposits):

  • Interest rate boost of 5% if your combined balance is $20,000 to $49,999;

  • 10% boost on combined balances of $50,000 to $99,999;

  • 20% boost on balances of $100,000 or more.

Those percentages may sound generous, but as it stands, Bank of America’s interest rate is so low that even a 20% increase is negligible.

Customer support options: 4 out of 5 stars

In addition to 24/7 phone, online, mobile and chat support, clients can meet with a Merrill Edge advisor at one of about 2,500 locations across the U.S. The advisors aren’t there to offer investment advice or financial planning guidance, but they can answer general questions, such as how to fund the account and how to use the account's tools.

How do we review robo-advisors?

NerdWallet’s comprehensive review process evaluates and ranks the largest U.S. robo-advisors by assets under management, along with emerging industry players, using a multifaceted and iterative approach. Our aim is to provide an independent assessment of providers to help arm you with information to make sound, informed judgements on which ones will best meet your needs.

DATA COLLECTION AND REVIEW PROCESS

We collect data directly from providers, and conduct first-hand testing and observation through provider demonstrations. Our process starts by sending detailed questionnaires to providers to complete. The questionnaires are structured to equally elicit both favorable and unfavorable responses from providers. They are not designed or prepared to produce any predetermined results. The questionnaire answers, combined with product demonstrations, interviews of personnel at the providers and our specialists’ hands-on research, fuel our proprietary assessment process that scores each provider’s performance across more than 20 factors. The final output produces star ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

RATING FACTORS

Evaluations vary by provider type, but in each case are based upon the weighted averages of factors that include but are not limited to: advisory and account fees, account minimums and types, investment selection, investment expense ratios, trading costs, access to human financial advisors, educational resources and tools, rebalancing and tax minimization options, and customer support including branch access, user-facing technology and mobile platforms.

Each factor can involve evaluating various sub-factors. For instance, when gauging the investment selections offered by robo-advisors, 80% of the score is based on the potential for diversification (how well-diversified a resulting portfolio of investments could be) combined with the availability of specialty portfolios and level of customization for investors. Expense ratios form an additional 10% of the score, and low or no management fee the remaining 10%.

FACTOR WEIGHTINGS

The weighting of each factor is based on our team’s assessment of which features are the most important to consumers and which ones impact the consumer experience in the most meaningful way. The factors considered, and how those factors are weighted, change depending upon the category of providers reviewed.

INFORMATION UPDATES

Writers and editors conduct our broker reviews on an annual basis but continually make updates throughout the year. We maintain frequent contact with providers and highlight any changes in offerings.

THE REVIEW TEAM

The review team comprises seasoned writers, researchers and editors who cover stocks, bonds, mutual funds, index funds, exchange-traded funds, alternative investments, socially responsible investing, financial advisors, retirement and investment strategy on a daily basis. In addition to NerdWallet, the work of our team members has been published in The New York Times, The Washington Post, Forbes, USA Today, Bloomberg News, Nasdaq, MSN, MarketWatch, Yahoo! Finance and other national and regional media outlets.

The combined expertise of our Investing team is infused into our review process to ensure thoughtful evaluations of provider products and services from the customer perspective. Our writers and editors combine to have more than 70 years of deep experience in finance, ranging from a former Wall Street Journal reporter to a former senior financial advisor at Merrill Lynch.

CONFLICTS OF INTEREST

While NerdWallet does have partnerships with many of the reviewed providers, we manage potential conflicts of interest by maintaining a wall between our content and business operations. This wall is designed to prevent our writers and the review process from being influenced or impacted by our business partnerships. This way, all reviews can provide an unbiased review that serves the interests of our users. For more information, see NerdWallet’s editorial guidelines.

Merrill Edge Guided Investing with Advisor

Merrill Edge Guided Investing with Advisor has a management fee of 0.85% and a $20,000 account minimum. If you qualify for the rewards program described above, that fee drops to 0.80%, 0.75% or 0.70% depending on your total combined balance.

The upper-tier service offers access to a human advisor who can give you one-on-one advice, help you establish goals and meet with you for periodic reviews. These advisors hold a variety of designations, and while some of them are CFPs, not all of them are. You can, however, get help in person at Bank of America locations.

While Merrill does offer access to human advisors, other companies provide the same service at a lower cost, or even for free. Vanguard Personal Advisor Services charges 0.30% and includes a team of financial advisors; Charles Schwab's Intelligent Portfolios Premium offers unlimited access to CFPs for $30 per month plus a $300 one-time planning fee — which shakes out to 0.36% on a $100,000 balance plus the planning fee. Personal Capital, which caters to high-net-worth clients, charges 0.89% on your first million, a tad higher than Merrill's 0.85% management fee for the robo-plus-live-advisor tier. Many of those services offer higher-end financial planning services, while Merrill’s are more limited.

Merrill Guided Investing with an Advisor offers the same strategies as the lower tier, plus it offers an Alpha-Seeking strategy which includes mutual funds in the portfolios. Because of this, the portfolio costs are generally a bit higher  — 0.45% to 0.60% versus 0.05% to 0.09% for the Core ETF portfolios.

» Want to compare options? Check out our roundup of the best wealth advisors

Merrill Edge Guided Investing with Advisor at a glance

Account minimum

$20,000.

Account management, planning or subscription fee

0.85%.

Account fees (annual, transfer, closing)

Full account transfer fees range from $49.95 to $95.

Setup or onboarding fee

None.

Advisor access and credentials

Dedicated advisors meet with clients at least annually, but can connect on an as-needed basis. Some advisors are CFPs, but not all. Advisors can be contacted by phone, email, video chat, as well as in person at a local Bank of America financial center.

Advisors are usually available in-person at Bank of America financial centers Monday through Friday 9:00 a.m. to 5:00 p.m. and Saturdays from 9:00 a.m. to 1:00 p.m. (though hours may vary depending on the location). Advisors are also available from 8:00 a.m. to 8:00 p.m. by phone through the national office.

Financial planning services

Advisors can help with retirement planning and goal planning but cannot help you with tax strategy, estate planning or investment management.

Investment expense ratios

Core ETF portfolios: 0.05% to 0.09%. Socially responsible portfolios: 0.15% to 0.19%. Alpha-Seeking strategy: 0.45% to 0.60%.

Portfolio construction

Portfolio mix is well-diversified but lacks exposure to non-market correlated assets like REITs and commodities. Clients can request restrictions on specific ETFs or mutual funds.

Includes access to the Alpha-Seeking strategy not available at the lower tier of service.

Brokerage options

Must have assets custodied with Merrill Edge. Advisors can consider assets held in accounts outside Merrill Edge for goal tracking.

Is Merrill Edge Guided Investing right for you?

If you’re a Merrill Edge or Bank of America loyalist and you’ve been wanting to take a dip in the robo-advisor waters, this might be where you get started. It’s a relatively easy transition, and your account will integrate pretty seamlessly with your existing accounts. You may also qualify for the company’s Preferred Rewards offering, which could mean a lower management fee and other perks.

Otherwise, investors are likely to get more for their money elsewhere, because many other online advisors charge lower fees while offering better tax strategy and financial planning services.

How do we review robo-advisors?

NerdWallet’s comprehensive review process evaluates and ranks the largest U.S. robo-advisors by assets under management, along with emerging industry players, using a multifaceted and iterative approach. Our aim is to provide an independent assessment of providers to help arm you with information to make sound, informed judgements on which ones will best meet your needs.

DATA COLLECTION AND REVIEW PROCESS

We collect data directly from providers, and conduct first-hand testing and observation through provider demonstrations. Our process starts by sending detailed questionnaires to providers to complete. The questionnaires are structured to equally elicit both favorable and unfavorable responses from providers. They are not designed or prepared to produce any predetermined results. The questionnaire answers, combined with product demonstrations, interviews of personnel at the providers and our specialists’ hands-on research, fuel our proprietary assessment process that scores each provider’s performance across more than 20 factors. The final output produces star ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

RATING FACTORS

Evaluations vary by provider type, but in each case are based upon the weighted averages of factors that include but are not limited to: advisory and account fees, account minimums and types, investment selection, investment expense ratios, trading costs, access to human financial advisors, educational resources and tools, rebalancing and tax minimization options, and customer support including branch access, user-facing technology and mobile platforms.

Each factor can involve evaluating various sub-factors. For instance, when gauging the investment selections offered by robo-advisors, 80% of the score is based on the potential for diversification (how well-diversified a resulting portfolio of investments could be) combined with the availability of specialty portfolios and level of customization for investors. Expense ratios form an additional 10% of the score, and low or no management fee the remaining 10%.

FACTOR WEIGHTINGS

The weighting of each factor is based on our team’s assessment of which features are the most important to consumers and which ones impact the consumer experience in the most meaningful way. The factors considered, and how those factors are weighted, change depending upon the category of providers reviewed.

INFORMATION UPDATES

Writers and editors conduct our broker reviews on an annual basis but continually make updates throughout the year. We maintain frequent contact with providers and highlight any changes in offerings.

THE REVIEW TEAM

The review team comprises seasoned writers, researchers and editors who cover stocks, bonds, mutual funds, index funds, exchange-traded funds, alternative investments, socially responsible investing, financial advisors, retirement and investment strategy on a daily basis. In addition to NerdWallet, the work of our team members has been published in The New York Times, The Washington Post, Forbes, USA Today, Bloomberg News, Nasdaq, MSN, MarketWatch, Yahoo! Finance and other national and regional media outlets.

The combined expertise of our Investing team is infused into our review process to ensure thoughtful evaluations of provider products and services from the customer perspective. Our writers and editors combine to have more than 70 years of deep experience in finance, ranging from a former Wall Street Journal reporter to a former senior financial advisor at Merrill Lynch.

CONFLICTS OF INTEREST

While NerdWallet does have partnerships with many of the reviewed providers, we manage potential conflicts of interest by maintaining a wall between our content and business operations. This wall is designed to prevent our writers and the review process from being influenced or impacted by our business partnerships. This way, all reviews can provide an unbiased review that serves the interests of our users. For more information, see NerdWallet’s editorial guidelines.