8 Best Robo-Advisors of March 2024

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Contributor, Benzinga
March 1, 2024

Check out M1 Finance for your robo-advisor investing needs.

With so many investment options out there, how do you know which one is the best for you? Robo-advisors have become a popular choice for individuals looking to grow their wealth through automated investing strategies. They provide low-cost financial advice and investment management to help build wealth without spending hours researching. Using robo-advisors can make investing much simpler.

Today, there are more options than ever when it comes to automating your investments. Choosing the right robo-advisor can make a significant impact on your investment success. Take a look at eight of the best robo advisors and learn a bit more about the pros and cons that come with using their innovative tools.

Quick Look: Best Robo Advisors

Best Robo-Advisors for Investing

Wondering which robo-advisor is right for you? Take a look at the industry's best robo advisors to find the perfect investment solutions for your financial goals.

1. Best for Customizable Auto Investing: M1 Finance

  • M1 Finance
    Best For:
    Customizable Auto Investing
    securely through M1 Finance's website

    Brokerage products and services are offered by M1 Finance, LLC, Member FINRA/SIPC, and a wholly-owned subsidiary of M1 Holdings, Inc. ✝Your free trial (a $30 value) begins the date you enroll in the M1 Plus subscription, and ends 3 months after (“Free Trial”). Upon the expiry of the Free Trial, your account is automatically billed a monthly subscription fee of $10 unless you elect annual billing of $95 or cancel your subscription under your Membership details in the M1 Platform

M1 Finance is a unique robo-advisor that uses a “pie investing” strategy to help you visualize your progress toward retirement savings, homeownership or your financial goals. It is an investment advisor.

When you sign up with M1 Finance, you’ll answer a few questions about your finances and investing preferences. From there, you can choose from 1 of 80 experts “investing pies” made up of a selection of stock and ETF “slices.” You can also create your own pie by selecting investments yourself.

When you make a deposit into your M1 Finance account, it will automatically split your investment according to your investing mix. You can schedule deposits on a weekly, monthly or annual basis.

There are no fees or commissions on basic M1 Finance accounts, and you can get started investing with as little as a $100 initial deposit.

Pros

  • No commission fees for trades
  • Ability to automate investments and set up recurring deposits
  • Offers a wide range of investment options including stocks, ETFs, and retirement accounts
  • Allows for fractional share investing, making it accessible to investors with limited capital
  • Offers a user-friendly and intuitive mobile app for convenient investing on-the-go

Cons

  • Limited customer service support compared to traditional brokerage firms
  • Trading restrictions on certain securities such as low-volume stocks or penny stocks
  • May not offer as many research and educational resources as other platforms
  • May not be suitable for advanced trading strategies or options trading

2. Best for New Investors With Limited Time: Titan

Registering with Titan gives you access to a range of strategies that will invest your money wisely. You can review the FAQs or the Learn section if you want to know more about automated trading, or you can review the strategies currently offered:

  • Flagship: The award-winning, U.S. large-cap strategy
  • Offshore: The international all-cap strategy
  • Opportunities: Identifies small-cap U.S. companies that can grow quickly
  • Crypto: An investing strategy focused on crypto assets

With low minimum investment, no performance fee, SIPC insurance and no lockups, you can be certain your money is invested with wisdom and is protected. Plus, the company stands behind its investment advisor duty to grow its capital and yours. You can even reach out to their customer support team, ask questions and review your investing account at any time.

Pros

  • Established and reputable investment firm
  • Expert team with extensive knowledge and experience in the industry
  • Offers a wide range of investment options to suit different investor preferences
  • Provides personalized and tailored investment strategies
  • Access to global markets and investment opportunities
  • Strong track record of delivering consistent returns to clients

Cons

  • May have higher fees compared to other investment firms
  • Limited information available on their investment process and strategies
  • Requires an account minimum, which may not be suitable for all investors
  • Limited transparency on their portfolio holdings and performance

3. Best for Cost-Conscious Investors: SoFi Automated Investing

Automated investing through SoFi is known as “hands-off investing that’s always on.” SoFi Invest can help you set goals, whether you’re saving for retirement, saving for a down payment or simply investing for later. The brand will rebalance your investments by adjusting your stock and bond funds quarterly and diversify your portfolio by allocating across several different investments and avoid as much risk as possible.

You can start investing through SoFi with as little as $1 and make one-time or recurring payments depending on what works best for your investment goals. SoFi Invest also gives you access to member benefits and discounts on other SoFi products.

Based on Reddit discussion, if you want a mix of automated and active investing, SoFi might be your move.

Pros

  • Convenient and easy to use
  • Offers low-cost index funds and ETFs
  • Provides access to professional investment advice and expertise
  • Offers automatic rebalancing and tax-loss harvesting
  • Provides a user-friendly online platform with helpful tools and resources

Cons

  • Limited investment options compared to traditional brokerage accounts
  • Requires a minimum investment amount to get started
  • No personalized investment strategy or customization options
  • Lack of direct control over individual investment decisions
  • Possible fees for certain services or transactions

4. Best for High Net Worth Individuals: Empower

If you have a more complicated financial situation, you might consider investing using robo-advisors with Empower, formerly Personal Capital. Empower is a hybrid financial planner, wealth management company and investment service that can help you manage your money for the future and plan toward multiple goals.

The biggest draw of Empower’s system is its human advisor services. No matter your balance, you’ll receive individual investing advice from a team of financial advisors. If you have at least $250,000 in assets, you’ll receive your own personal team of two dedicated financial advisors.

Pros

  • Offers a wide range of financial services to cater to different needs
  • Experienced financial advisors who can provide expert guidance and advice
  • Strong reputation and positive customer reviews, indicating their professionalism and reliability
  • Convenient online access to account information and easy transaction management
  • Provides personalized financial planning to help individuals and businesses meet their financial goals

Cons

  • Some services offered may come with fees or charges
  • May have specific eligibility criteria or requirements for certain services
  • Not all financial services may be available in every location or for every individual
  • May have limitations or restrictions on certain investment options
  • Privacy and security concerns regarding data storage and sharing practices

5. Best for Auto Trading: Streetbeat

Headquartered in Palo Alto, Streetbeat is a fintech platform that offers auto trading services across a range of assets; you can buy into stocks, ETFs, crypto and much more. Plus, the platform is designed to focus on you, the client. This means that you get the best information and support for each investment.

Streetbeat leverages AI technology and data solutions to help you build your portfolio, and along with these benefits, customers also get:

  • Support for investors of all skill levels
  • No trading commissions
  • Low minimums (as low as $1)
  • Bonus opportunities
  • Less than a 1% management fee when using strategies build by Streetbeat

Yes, it’s true that fees could accumulate quickly on large accounts, but Streetbeat makes it easy for you to get in on the ground floor and build your portfolio with less risk and even less overhead.

Pros

  • Offers a wide range of financial tools and services, such as budgeting and investing
  • Provides real-time financial data and analysis
  • Offers personalized financial advice and recommendations
  • Enables users to easily track and manage their expenses

Cons

  • Potential security risks and concerns regarding personal financial information
  • Reliance on technology can lead to system glitches or downtime
  • Limited access or availability in certain regions or countries
  • Additional fees or charges for certain transactions or services
  • May require a learning curve or adjustment period for individuals unfamiliar with fintech platforms

6. Best for Long Term Investors: Magnifi

Magnifi is a marketplace that allows you, as the investor, to use common brokerage tools and AI to make the best decisions for your portfolio. Because you can pull up all the information you need on a given asset, you can easily invest using robo advisors in the assets that will give you the results you deserve and better match your strategy. Search for the investment options that meet your needs, invest in specific categories or scan for assets in a price range that’s affordable for you.

Best for long-term investors and those who require a bit of client support, you can also learn more about investing from this platform, utilize the AI-powered investing assistant, enjoy commission-free investing, try the mobile app and take advantage of over 15,000 possible investment portfolio options. This makes Magnifi a good place to trade for both seasoned and novice traders.

Pros

  • Offers a wide range of financial services and products
  • Strong reputation and experience in the financial industry
  • Provides personalized financial solutions tailored to individual needs
  • Offers competitive interest rates and terms
  • User-friendly online platform for easy access to accounts and transactions

Cons

  • Some of their financial products may have account fees or charges
  • May have stricter eligibility criteria for certain services
  • Limited physical branch locations may limit face-to-face customer service options
  • Customer reviews and experiences may vary, and not all customers may be satisfied with their services
  • May not offer certain specialized financial products or services that its competitors may provide

7. Best for People Interested in Investing in Portfolios: Q.ai

Q.ai is backed by Forbes and wants to help investors explore new types of investments help from artificial AI technology. This particular AI investing app is designed to support you on your journey to financial freedom as you build a strong portfolio and seek assistance as assets cross your desk. In short, you can get information and assistance from real financial advisors or the AI, depending on what you need. Plus, you can order Kits that will help you learn more about protecting your portfolio and investing with wisdom.

Pros

  • Offers advanced technology and AI-driven investment insights
  • Provides personalized investment recommendations
  • Monitors and adjusts investment strategies to maximize returns
  • Offers a user-friendly interface and easy-to-understand investment reports
  • Access to a wide range of investment options and diversified portfolios

Cons

  • May have a learning curve for users unfamiliar with advanced investment technology
  • May come with subscription or management fees
  • Users may still need to conduct their own research and due diligence before making investment decisions
  • Recommendations are based on historical data and algorithms, which may not always accurately predict future market trends
  • Users may have limited control and flexibility over their investment strategies

8. Best for Long Term Investors: Wealthfront

According to Reddit, If you're looking for a tried and true robo-advisor with a ton of investment options, Wealthfront would be a great choice. Wealthfront is one of the pioneers in the robo-advisory industry, with the aim of providing low-cost and efficient investment solutions to individual investors. Using advanced algorithms and computer-driven models, Wealthfront creates and manages diversified portfolios for its clients.

When you sign up for Wealthfront, you'll first complete a questionnaire to determine your financial goals, risk tolerance and time horizon. Based on your responses, Wealthfront's algorithms will create a personalized investment portfolio designed to maximize your returns while minimizing risk. It offers two tools to help you with your financial planning and portfolio management: Path and Autopilot.

Path focuses on comprehensive financial planning services and offers strategies for long-term wealth accumulation, retirement planning and college savings. Autopilot, on the other hand, emphasizes socially responsible investing by building portfolios that prioritize companies with positive environmental, social and governance practices. Both platforms have transparent pricing structures and user-friendly interfaces.

Additionally, the company offers a competitive interest rate for its cash management account, which is protected by the Federal Deposit Insurance Corporation (FDIC). Plus, there are no fees associated with it.

Pros

  • Convenient and easy to use
  • Low fees compared to traditional financial advisors
  • Offers tax-efficiency strategies to maximize returns
  • Utilizes advanced algorithms and technology to optimize investment portfolios

Cons

  • Less suitable for complex financial situations or unique investment needs
  • Requires account minimum to open an investment account
  • May not be as suitable for investors who prefer interaction with a human advisor

How Do Robo-Advisors Work?

Robo-advisor uses algorithms and automated software to manage and optimize investment portfolios. These platforms aim to provide personalized investment advice and portfolio management through technology, with minimal human intervention.

The process begins by collecting important information from the investor. This includes their financial goals, risk tolerance, time horizon and investment preferences. Based on this data, the robo-advisor algorithm utilizes complex algorithms to create a customized investment portfolio that aligns with the investor's objectives.

The algorithm takes into account various factors such as historical market data, asset correlations and risk models to determine the optimal asset allocation. It will consider a range of asset classes including stocks, bonds, exchange-traded funds (ETFs), and more. The goal is to build a diversified portfolio that maximizes returns while minimizing risk.

Once the portfolio is established, the robo-advisor continuously monitors the market and makes adjustments as necessary. For example, if the algorithm detects a deviation from the target asset allocation due to market fluctuations, it will automatically rebalance the portfolio to restore the desired allocation. This ensures that the investor's portfolio remains aligned with their goals and risk tolerance.

Why Use the Best Robo-Advisors for Investing

Do you think that investing with a robo-advisor might be right for you? Let’s take a look at a few of the biggest advantages and disadvantages that come with using robo-advisors for this type of investment platform.

Advantages

  • Assistance in choosing investment profiles: Robo-advising services provide easy and customizable investment options for beginners, with award-winning investment models based on investing goals and risk tolerance.
  • Low fees: A major advantage of robo-advisors over human advisors is the low fees. On average, you can expect to pay between 0.25% to 0.50% of your total assets under management for your robo-advisor. On the other hand, most human financial advising services charge about 1% of your total assets annually for services. While this might not sound like a huge difference, it can add up over time and cut into your savings.
  • Low minimums: Most human financial advisors have high minimum investments. Because these services charge around 1% of your total assets under management, it might not be worth it for an advising firm to take on clients with less than $250,000 in assets. Some registered financial advisors have minimum account balances as high as $1 million..

Disadvantages

  • Don’t offer 100% personalization: Though robo-advisors are advanced and most offer a host of investing choices, they aren’t 100% personalized. A robo-advisor can’t offer you advice after a significant market drop and they may be able to provide limited advice if you have multiple financial goals. If you have a more complicated financial situation, you might need the human touch of a personal financial advisor.
  • No face-to-face meetings: If you’ve never invested before, you might want the hand-holding that a human financial advisor can offer. When you invest with the best robo advisor, you can’t walk into an office or schedule a meeting with an advisor — you’re on your own with the tools your robo-advisor offers.

How to Choose the Right Robo-Advisor for You

With so many robo-advisors available in the market, it can be overwhelming to choose which robo-advisor is right for you. Here are some factors to consider to help you make an informed decision.

  • Determine your investment goals: It's important to have a clear understanding of your investment objectives. Are you saving for retirement, buying a house, or simply looking to grow your wealth? Different robo-advisors may have varying investment strategies and asset allocations, so choosing one that aligns with your goals is crucial.
  • Consider the fees: Robo-advisors typically charge a fee for their services, usually as a percentage of your assets under management. Compare the fees offered by different platforms and consider how they may impact your returns over time. While lower fees are generally preferred, make sure to also consider the value and quality of the services provided.
  • Assess the investment options: When considering a robo-advisor, look at the investment options available such as ETFs and individual stocks to ensure they align with your risk tolerance and investment preferences.
  • Evaluate the user interface and experience: Since robo-advisors are online platforms, it's important to choose one with a user-friendly interface and a seamless user experience. Check if the platform offers a mobile app for easy access and if it provides educational resources or tools to help you make informed investment decisions.
  • Consider customer support and assistance: While robo-advisors are automated platforms, it's still important to have access to reliable customer support when needed. Look for a robo-advisor that offers responsive customer service through various channels, such as phone, email or live chat. Additionally, some robo-advisors also provide access to human financial advisors for more personalized assistance.
  • Research the reputation and security: Before entrusting your money with a robo-advisor, do some research on the company's reputation and security measures. Look for reviews and testimonials from other users to gain insights into their experiences. Ensure that the robo-advisor implements robust security protocols to safeguard your personal and financial information.
  • Consider additional features: Some of the best robo-advisors may offer additional features, such as tax-loss harvesting, automatic rebalancing or access to socially responsible investments. Assess these additional features and determine if they align with your preferences and goals.

Remember, choosing the best robo-advisor is a personal decision that depends on your specific needs and preferences.

Invest with a Robo-Advisor

Though they have their flaws, robo-advisors are an easy and accessible way to begin investing for the future. Most robo-advising services offer a surprising level of personalization, and you can get started investing in as little as 10 minutes.

If you’ve been wanting to learn more about investing but have been overwhelmed by brokers and asset classes in the past, using robo-advisors might be right for you. Take the time to research and compare different platforms including our recommended robo-advisors, as well as other options such as Betterment and Vanguard Personal Advisor Services. Look into your account options and start investing today.

Frequently Asked Questions

Q

Are robo-advisors good for beginners?

A

Yes, robo-advisors are a great way for people to begin investing.

Q

Are robo-advisors less expensive than in-person advisors?

A

Yes, robo-advisors are typically less expensive than human consultants.

Q

Are robo-advisors good for people with complicated financial matters?

A

Robo-advisors are not a great option for people who are dealing with complicated financial matters.

Q

Which is the best performing robo-advisor?

A
The best performing roboadvisor can vary depending on individual preferences and investment goals. Some well-known and highly rated roboadvisors include Sofi Invest, Betterment, Wealthfront and Vanguard Personal Advisor Services. It’s important to consider factors such as advisory fees, investment strategies, customer service and ease of use when determining which roboadvisor may be the best fit for your specific needs.
Q

Do any robo-advisors beat the market?

A
Some roboadvisors have been able to beat the market, but their success depends on factors like investment strategy, data quality, and algorithm management. It’s important to research and assess a roboadvisor‘s performance and credibility before investing.
Q

Is it worth paying for a robo-advisor?

A

Yes, it can be worth paying for a roboadvisor depending on preferences and investment objectives. It is important to consider fees and understand the limitations of roboadvisors before deciding if they are the right choice for one’s financial situation.

About Sarah Horvath

Sarah is an expert in the insurance, investing for retirement and cryptocurrency space.