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Robo-Advisor Fees: 11 Investment Services and How They Stack Up

Updated on April 24, 2024 Updated on April 24, 2024
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Table of Contents  
  1. Robo-Advisor Fees
  2. 11 Robo-Advisor Fees Compared
  3. Is a Robo-Advisor Right for You?

Robo-advisors are a digital, low-cost alternative to a traditional financial advisor. As with any investment platform, fees can make all the difference. This post examines robo-advisor costs, including management fees and expense ratios, and how they vary based on your needs.

Deciding which one is best for you depends on several factors. We’re trying to determine what level of tools and guidance justify the robo-advisor fees you’ll end up paying.

If you don’t need a lot of support, then paying a premium might not be necessary. But, if you do need help, it’s worth paying a little extra.

Your asset allocation, risk tolerance, and even how much human financial advice you’ll want all play a part in deciding which one is best for you.

Some shine with their personal advisor services, and some with their investment strategy. This article will mostly focus on the robo-advisor fees, but will also highlight what makes each robo-advisor stand out.

Robo-Advisor Fees

As far as robo-advisor fees go, there are two main things to consider: account management fees and the expense ratios of the funds available.

Some seem reasonable because their account management fees are low, but they only offer funds with high expense ratios.

Others have high initial fees but offer funds with low expense ratios. It’s essential to look at both numbers before making a decision.

The following robo-advisors are ordered based on management fees as well as factoring in the average expense ratios.

This article isn’t trying to answer which is the best robo-advisor overall. Instead, it’s attempting to give you an idea of how the costs stack up compared to what you get for your money.

Depending on the size of your portfolio, the order might change. Keep in mind; the best robo-advisor isn’t necessarily the cheapest, it’s the one that works best for you.

Our Pick
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11 Robo-Advisor Fees Compared

SoFi Invest

SoFi not only doesn’t charge account management fees, but they also don’t charge administrative fees. With SoFi, you have free access to certified financial planners as well as a broad range of low-cost investments.

Their financial advisors are fiduciaries, which means they are legally obligated to act in your best interest. They’re not paid on commission for selling specific products or making certain trades. This helps to avoid conflicts of interest, where an advisor might recommend a product that benefits them more than it benefits you. It’s an incredible service SoFi offers.

SoFi’s fee structure is attractive. While many robo-advisors charge management fees, SoFi doesn’t. When you consider both management fees and underlying investment expense ratios, SoFi can be a cost-effective option.

SoFi provides complimentary consultations with financial advisors to help you get started. These advisors focus on basic financial planning and using SoFi’s investing tools. This was the tie-breaker between SoFi and the next few we’ll list.

SoFi Recap

Pros:

  • Account Management Fees: $0 – SoFi does not charge any fees for managing your investment portfolio through their robo-advisor service. This is a significant advantage compared to many other robo-advisors.
  • ETF Expense Ratio: 0.03%-0.08% – SoFi uses low-cost ETFs to build client portfolios, which helps to keep fees low.
  • Account Minimum: $0 – You don’t need a large amount of money to get started with SoFi Automated Investing.
  • Free Access to Financial Advisors – SoFi offers complimentary consultations with certified financial planners (CFPs) to help you get started and answer basic questions. This can be a valuable resource for new investors.

Cons:

  • Tax-loss harvesting unavailable – Unlike some other robo-advisors, SoFi’s automated investing service doesn’t currently offer tax-loss harvesting, a strategy that can help reduce your tax bill.
  • Limited advisor services – The free financial advisor consultations have a limited scope and may not be suitable for complex financial needs.

Overall:

SoFi Automated Investing is a good option for:

  • Fee-conscious investors: The lack of account management fees and low expense ratio ETFs make it a cost-effective option.
  • Beginners: The user-friendly platform, low minimum investment, and access to financial advisors make it a good choice for those starting out with investing.

Read our SoFi review here.

M1 Finance

You can’t have a serious conversation about the best robo-advisors without having M1 Finance at the top of your list.

No matter which metric you’re using, M1 Finance is hard to beat. They don’t charge fees for trading (stocks and ETFs) and have an extensive list of stocks and exchange-traded funds (ETFs).

With M1 Finance, users have access to taxable accounts, IRAs, and even LLC business accounts. They also have pre-made portfolios.

If you’re unsure where to invest, M1 Finance might be your cheaper, more straightforward option.

M1 Finance is best for those who don’t need advice; they want an inexpensive, easy-to-use platform.

M1 Finance Recap

Pros:

  • No Trading Fees: M1 Finance does not charge commission fees for buying or selling stocks and ETFs. This is a significant advantage for active investors who trade frequently.
  • Wide Investment Selection: M1 offers a large selection of stocks and ETFs, giving investors a variety of options to choose from.
  • Multiple Account Types: M1 provides taxable accounts, IRAs, and even LLC business accounts, catering to a wide range of investment needs.
  • Pre-Built Portfolios: M1 offers pre-made investment portfolios, called “pies,” which can be a good option for investors who don’t want to pick individual stocks and ETFs.

Cons:

  • Limited Robo-Advisor Features: Unlike some robo-advisors, M1 doesn’t offer automated portfolio management features or tax-loss harvesting.
  • Research Required: M1 doesn’t provide extensive investment research or advice. Investors need to do their own research before choosing investments.

Overall:

M1 Finance is a good option for:

  • Cost-conscious investors: The lack of trading fees and low account minimums make it an attractive option.
  • DIY investors: M1 provides a user-friendly platform for building custom investment portfolios.
  • Investors seeking multiple account types: M1 offers taxable accounts, retirement accounts, and even business accounts.

Read the full review here. Or check out their site.

Ally Invest Managed Portfolios

Ally Invest Managed Portfolios are attractive because they offer no management fees provided that you carry a cash minimum of 30%.

If you’re not into the idea of holding that much cash, they charge a .30% management fee for assets under management.

Ally Invest Recap

Pros:

  • Potentially Fee-Free: The cash-enhanced option allows you to avoid management fees by holding a 30% cash allocation in your portfolio. This cash earns interest, currently at a competitive rate.
  • Low Minimum Investment: Ally Invest requires only $100 to open a Managed Portfolio account.

Cons:

  • High Cash Allocation: The cash-enhanced option, which avoids fees, requires a 30% cash allocation. This reduces the potential for growth compared to a fully invested portfolio.
  • Management Fee for Market-Focused Option: If you choose the market-focused option with a minimal cash allocation, you’ll be charged a 0.30% annual management fee.

Overall:

Ally Invest Managed Portfolios can be a good fit for investors seeking a low-cost option with some built-in cash safety. The fee-free cash-enhanced option is attractive, but the 30% cash allocation may not be ideal for everyone. Investors with a longer time horizon or higher risk tolerance may prefer a robo-advisor with a lower cash allocation or explore other investment options.

Ally Invest
Ally Invest offers commission-free trading on all U.S. listed stocks, ETFs, and options. Its investment products are many, including self-directed brokerage accounts, IRAs, managed portfolios, margin accounts, and forex trading.

SigFig

SigFig is an excellent option for those just starting. While their account minimum is $2,000, they offer free account management on portfolios under $10,000; once you cross the $10,000 threshold their 0.25% assets under management fee is quite reasonable.

What makes SigFig stand out is the unlimited access you get to financial advisors. Many robo-advisors give access to financial advisors, but it’s almost always only available with their premium service.

SigFig Recap

Pros:

  • Free Account Management for Smaller Portfolios: SigFig offers a management fee waiver for accounts under $10,000. This can be a significant advantage for new investors starting with smaller balances.
  • Reasonable Management Fee for Larger Portfolios: Their 0.25% fee is fairly standard compared to other robo-advisors.
  • Unlimited Access to Financial Advisors: SigFig distinguishes itself by including access to financial advisors at all account sizes. This can be valuable for beginners who may need help with financial planning or investment decisions.

Cons:

  • Higher Account Minimum Than Some Robo-Advisors: The $2,000 minimum investment might be higher than some competitors.
  • Limited Features Compared to Some Robo-Advisors: SigFig focuses on core portfolio management and may not offer as many features as some other robo-advisors, such as tax-loss harvesting or robo-retirement account options.

Overall:

SigFig can be a good choice for beginning investors who:

  • Value access to financial advisors: Unlimited financial advisor consultations can be a big benefit, especially for those who need help getting started with investing.
  • Have a portfolio under $10,000: The waived management fee makes it a cost-effective option for smaller accounts.

However, if you have a larger portfolio or prioritize a wider range of features and tax-optimization options, you might consider other robo-advisors.

SigFig is best for new investors who want access to financial advisors and enjoy playing with various financial tools and calculators.

Schwab Intelligent Portfolios

Charles Schwab comes in hot with their Schwab Intelligent Portfolios that will build, manage, and rebalance your portfolio based on your risk tolerance.

While there aren’t a ton of additional perks for investors with lower amounts, tax-loss harvesting is available for taxable accounts with a value of more than $50,000.

Schwab Intelligent Portfolios offers a premium version that gives access to a Certified Financial Planner (CFP) for a $30 monthly fee and a one-time $300 onboarding fee.

The account minimum for their premium service is $25,000.

Schwab Recap

Pros:

  • Automated Portfolio Management: Schwab Intelligent Portfolios build, manage, and rebalance your portfolio based on your risk tolerance. This can be a good option for investors who want a hands-off approach.
  • Tax-Loss Harvesting (for larger accounts): Schwab offers tax-loss harvesting, a strategy that can help reduce your tax bill, but only for taxable accounts with a value exceeding $50,000.

Cons:

  • Limited Perks for Smaller Accounts: The statement is accurate – there aren’t many additional features specifically for investors with lower account balances.
  • Premium Service Fees: Access to a certified financial planner (CFP) comes with a $30 monthly fee and a one-time $300 onboarding fee for their premium service.
  • Higher Minimum for Premium Service: The $25,000 minimum investment for the premium service with a CFP can be a barrier for some investors.

Overall:

Charles Schwab Intelligent Portfolios can be a good choice for investors who:

  • Want a robo-advisor with a solid reputation: Charles Schwab is a large, established financial institution.
  • Have a taxable account over $50,000 and value tax-loss harvesting.
  • Plan to invest at least $25,000 and want access to a CFP (for an additional fee).

However, if you have a smaller portfolio or don’t need the services of a CFP, you might consider a robo-advisor with a lower minimum investment and features available at all account sizes.

Schwab Intelligent Portfolios is best for those who want to keep expenses as low as possible but are a little further down the financial path and need financial planners and tax-loss harvesting.

Wealthfront

Wealthfront offers strong tax-optimization and financial planning tools for investors seeking a high-interest savings option and college savings plans, but charges a flat fee and lacks human financial advisor access

Wealthfront Recap

Pros:

  • Tiered Fee Structure: Wealthfront does have a tiered fee structure, but it’s not exactly as described. They charge a 0.25% annual management fee on the entire account balance, regardless of amount. There is no free tier for accounts under $5,000.
  • High-Interest Savings Account: Wealthfront offers a cash account option that currently pays a 0.35% interest rate, which is competitive.
  • Tax-Optimization Services: Wealthfront is known for its strong tax-optimization features including tax-loss harvesting. However, daily tax-loss harvesting is not available for all accounts.
  • Financial Planning Tools: Wealthfront offers some financial planning tools, but does not provide access to human financial advisors for ongoing financial planning.
  • 529 College Savings Plans: Yes, Wealthfront offers 529 college savings plans.
  • Additional Features for Larger Accounts: Wealthfront unlocks some additional features for accounts with higher balances, such as the Risk Parity Fund and tax-loss harvesting on individual stocks (not just ETFs) for accounts over $100,000. The multifactor smart beta tool is available for taxable accounts exceeding $500,000.

Cons:

  • Account Management Fee: As mentioned above, the fee is 0.25% on the entire account balance, not free for accounts under $5,000.
  • No Fractional Shares: Wealthfront doesn’t currently offer fractional shares of ETFs.
  • No Access to Financial Planners: While Wealthfront offers some financial planning tools, they don’t provide access to human financial advisors for ongoing financial planning.

Overall:

Wealthfront can be a good choice for investors who:

  • Value tax-optimization: Their tax-loss harvesting features can be beneficial.
  • Want access to a high-yield savings account: Their cash account option offers a competitive interest rate.
  • Are interested in 529 college savings plans.
  • Have a larger portfolio (over $100,000) and want access to additional features.

However, if you have a smaller portfolio, require ongoing financial planning from a human advisor, or prefer the ability to invest in fractional shares, you might consider a different robo-advisor.

Wealthfront

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Ellevest

Ellevest, a robo-advisor focused on women’s finances, offers gender-specific investment strategies and financial planning for a flat fee, but lacks tax-loss harvesting and has limited options for larger portfolios.

Okay, so what does it mean: geared towards women?

robo-advisor fees

Excellent question. Ellevest builds their portfolios with women in mind, so everything from an increased expected lifespan, lower expected incomes, and career trajectory are taken into consideration.

Ellevest Recap

Pros:

  • Focus on Women Investors: Ellevest tailors its investment strategies and advice to address financial challenges and opportunities specific to women, such as longer lifespans and potential income gaps.
  • Low Minimum Investment: Ellevest offers a standard service with a 0.25% fee and no account minimum, making it accessible to new investors.
  • Access to Financial Planning (for premium): Their premium service provides access to a dedicated Certified Financial Planner for a higher fee (0.50%) and a $50,000 account minimum.

Cons:

  • Higher Fee for Premium Service: The premium service with access to a financial planner comes with a higher fee (0.50%) and a $50,000 account minimum.
  • Limited Investment Options: Ellevest may have a more limited selection of investment options compared to some other robo-advisors.
  • No Tax-Loss Harvesting: Ellevest does not currently offer tax-loss harvesting, a strategy that can help reduce your tax bill.

Overall:

Ellevest can be a good option for women investors who:

  • Appreciate a focus on their unique financial needs.
  • Are new investors with a smaller portfolio (for the standard service).
  • Want access to a financial planner and have a larger portfolio (for the premium service).

However, if you have a larger portfolio, prioritize a wider range of investment options, or require tax-loss harvesting features, you might consider a different robo-advisor.

Men are also welcome at Ellevest, but this isn’t a man cave. There will be throw pillows. Read our detailed Ellevest review here.

Ellevest is the first robo-advisor that caters to women unapologetically. It's not a marketing gimmick; they use science.

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Ellevest
Ellevest offers online investing for women on a platform using gender-specific salary curves and longevity data with a goal to help close the gender money gaps. Create a custom portfolio, build an emergency fund, or save for retirement.

Betterment

Betterment offers tax-loss harvesting on all accounts and a variety of free financial tools, but charges a management fee and has a high minimum for access to human financial advisors.

Betterment Recap

Pros:

  • Free Financial Planning Tools: Betterment offers a variety of free financial planning tools, including a retirement calculator, which can be valuable for investors.
  • Tax-Loss Harvesting: Betterment offers tax-loss harvesting on all accounts, which can help reduce your tax bill. This is a significant advantage compared to some other robo-advisors.
  • Two Service Tiers: Betterment caters to different needs with two service options:
    • Betterment Digital: This option has a lower fee (0.25%) and no account minimum, making it accessible to new investors.
    • Betterment Premium: This option offers access to certified financial planners for a higher fee (0.40%) and a $100,000 account minimum.

Cons:

  • Management Fees: Betterment does charge a management fee, which can be a deterrent for some investors, especially when compared to robo-advisors with lower fees.
  • High Minimum for Premium Services: The $100,000 minimum investment for Betterment Premium with a financial planner can be a barrier for many investors.

Overall:

Betterment can be a good choice for investors who:

  • Value access to financial planning tools and tax-loss harvesting.
    Want a robo-advisor with a solid reputation.
  • Are comfortable with a management fee (especially if considering the tax benefits of tax-loss harvesting).
  • Have a larger portfolio (over $100,000) and want access to a certified financial planner (through Betterment Premium).

However, if you have a smaller portfolio, prioritize lower fees, or don’t need access to a financial planner, you might consider a different robo-advisor.

Robo-advisor and are willing to pay a little extra.

Vanguard Personal Advisor Services

Vanguard Personal Advisor Services offers human financial advisors alongside automated investing for high net-worth investors who value a low-cost index approach but have a high minimum investment and don’t offer automatic tax-loss harvesting.

Vanguard Recap

Pros:

  • Human Advisors: Vanguard offers access to human financial advisors in addition to automated investing. This can be valuable for investors who want personalized guidance.
  • Reduced Fees for Larger Accounts: The management fee becomes progressively lower for accounts with higher balances, reaching a minimum of 0.05% for portfolios over $25 million.
  • Focus on Index Funds and ETFs: Vanguard uses a low-cost index fund and ETF approach, which aligns with its overall investment philosophy.

Cons:

  • High Minimum Investment: The $50,000 minimum investment can be a barrier for many investors.
  • Management Fee Compared to Some Robo-Advisors: The 0.30% base management fee is higher than some other robo-advisors, though it becomes more competitive for very large accounts.
  • No Automatic Tax-Loss Harvesting: Vanguard Personal Advisor Services doesn’t offer automatic tax-loss harvesting, a feature available with some competitors.

Overall:

Vanguard Personal Advisor Services can be a good fit for investors who:

  • Have a portfolio of at least $50,000.
  • Value access to human financial advisors.
  • Prefer a focus on low-cost index funds and ETFs.
  • Have a very large portfolio (over $25 million) and qualify for the lowest fee tiers.

However, if you have a smaller portfolio, prioritize lower fees upfront, or require automatic tax-loss harvesting, you might consider a different robo-advisor or traditional financial advisor.

Vanguard Personal Advisor Services is best for investors with high-value portfolios who want lots of human guidance but don’t want to pay for a financial advisor.

Empower

Empower’s Robo-advisor has the highest barrier to entry. It offers personalized financial guidance and automated investing but requires a larger starting balance.

Empower Recap

Pros:

  • Hybrid Approach: Empower Personal Wealth combines human financial advisors with automated investment management, offering a blend of personalized guidance and algorithmic portfolio management.
  • Reduced Fees for Larger Accounts: The management fee becomes progressively lower for accounts with higher balances, reaching a minimum of 0.49% for portfolios over $10 million.
  • Free Financial Tools: Empower offers a variety of free financial tools, including a budget tracker and investment analysis tools, even without using their wealth management services.

Cons:

  • High Minimum Investment: The $100,000 minimum investment is a barrier for many investors.
  • Higher Fees Compared to Robo-Advisors: The 0.89% base management fee is higher than most pure robo-advisors, though it becomes more competitive for very large accounts.

Overall:

Empower Personal Wealth can be a good fit for investors who:

  • Have a portfolio of at least $100,000.
  • Value a combination of human financial advice and automated investing.
  • Are comfortable with a higher fee (especially for smaller accounts) in exchange for personalized guidance.

However, if you have a smaller portfolio, prioritize lower fees upfront, or prefer a lower-cost robo-advisor experience, you might consider other options.nt tools

Check out Empower’s Fee analyzer to see how your investments stack up. It’s free. If investment fees are currently holding your portfolio back, it will help.

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Is a Robo-Advisor Right for You?

Deciding which robo-advisor is right for you depends a lot on your financial goals and your risk tolerance. Some Robo-advisors unlock additional services once you reach higher thresholds.

Each robo-advisor offers slightly different investment products, approaches, and fees that can vary substantially.

If you’re just starting, and don’t need a bunch of bells and whistles, then the first few robo-advisors listed might be best for you.

The further you get into your investing career, the more worthwhile it will be for you to pay higher costs to gain additional perks (e.g., more comprehensive portfolio management).

Once you reach multi-millionaire status, the more expensive robo-advisors such as Vanguard or Personal Capital start to make a lot more sense.

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Mark Fiebert - Contributor Mark spent over 30 years as a senior finance executive in Private Banking, Asset Management and Alternative Investments. Mark holds a BS in Accounting from Brooklyn College, an MBA in Finance from Pace University as well as being sponsored to attend The Wharton School Executive Development Program.
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