What the Hell is Robo-Investing? And Why Should I Care?

In the beginning, I was skepticalvery skeptical. Now I’m a raging fan.

Robo-Investing is the best thing to happen for investors since index funds were invented.

In Robo-Investing, a computer—not a person—creates and manages a portfolio of index funds and ETFs. What are advantages for you, the investor?

The price is right. Fees are very low (0.15% to 0.50% compared to 1%-2% for human advisors). Plus there’s either no, or a very low, minimum required to open an account.

It’s easy to start. You fill out a short questionnaire to assess your situation, goals and risk tolerance, then choose among suggested portfolios based on your answers. That’s it…you’re ready to invest.

Great customer service, at no extra charge. Offerings include automatic rebalancing so your portfolio doesn’t get out of whack; tax harvesting to offset capital gains; retirement planning; and a variety of educational classes.

Compare Robo-Investing to traditional advisors or managed funds, which require much higher minimums, charge much higher fees, yet consistently underperform indexing (often called passive investing) over time.

No wonder Robo-Investing has experienced explosive growth since it started in 2008.

Interested? Here are my recommendations. Check them out.

Have you tried Robo-Investing? Share your experience.

Comments & Feedback

  • Amanda

    I’ve been a Betterment customer since they launched and love it.

  • Ann Strong

    For my Roth IRA, I’m using Charles Schwab, Schwab Intelligence Portfolio for the past13 months and I love it! I wish I’d started 13 years ago.

    • barbara huson

      I’m thrilled you like it…and I’m just glad you didn’t wait another 13 years to start. Thanks for sharing this, Ann!

  • Julie Starr

    I’m thinking about it but fear of lack of communication stops me. When in a tough time and you have questions (like at the beginning of the pandemic) who do you ask? Love some feedback on this. Thanks.

    • barbara huson

      As I understand it, Julie, most of these robo investing firms have an option to talk to a human. Check them out.

  • Ashley

    I actually didn’t event know this existed. I have been looking for my avenue into the wealth game. After your email, I signed up for wealth front. I’m believing for the best.

    • barbara huson

      That’s awesome, Ashley. Thanks for letting me know. I’m so excited you signed up for Wealth Front. Makes me very happy!

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Meet Barbara Huson

When a devastating financial crisis rocked her world, Barbara Huson knew she had to get smart about money… and she did. Now, she wants to empower every women to take charge of their money and take charge of their lives! She’s doing just that with her best-selling books, life changing retreats and private financial coaching.

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