Annual Cost of Investing With Various Robot Advisors
Robo Expert Advisors have become a popular option for investors. They use tools to automatically, easily manage and help you diversify your investment portfolio – without human intervention. And while this automation makes them cheaper than a traditional financial advisor, that doesn’t mean they’re free.
Robo advisors can be a great way to build a simple investment portfolio for newbies . But Investor Junkie posted an interesting article on the annual fees of robot consultants that featured three of the most popular ones – Charles Schwab, Betterment, and Wealthfront.
The aim was to reveal the total annual cost of using each of these services. To calculate this, they added the expense ratio for the advisors themselves, the expense ratios of the funds they choose, and their annual fees. They then compared them for four different investment amounts: $ 5,000, $ 35,000, $ 125,000, and $ 500,000. This is what they found with their $ 35,000 investment:
Keep in mind – this is only a rough general estimate of the annual cost. It doesn’t take into account which firm has the best portfolio for your money, because there are too many variables involved. Their main purpose is to understand the real annual cost you are paying. FeeX is also a good resource for finding these fees. In fact, this cautionary advice is suitable for any type of investment, but it can be easy to underestimate the cost of an automated robotic advisor.
To see the full publication and the rest of the calculations, follow the link below.
The True Cost of Robot Consultants – What Are the Annual Fees? | Addict investor