5 popular U.S. based robo-advisors for investors

By Pavithra R

Robo-advisors are computer applications that advise investors about their investment decisions in a way that helps them to meet their financial goals. It is a type of financial application that is designed to increase the efficiency of financial services through the use of automation.

Although the COVID-19 outbreak has affected the market, the global robo-advisors industry is still expected to maintain its growth this year. According to data gathered by InsideBitcoins, the United States, as the leading robo-advisors market globally, is set to reach over $1trn value in 2020, growing by 40% year-on-year. Here is a list 5 U.S. robo-advisors for every kind of investors:

Betterment (2010)

Account Minimum: $0

Betterment was founded in the wake of a financial crisis, to be a place built to help people do what’s right with their money so they can live better. The company provides robo-advising and cash management services. It is a smart money manager that offers everyday services for spending and saving, alongside their core investing & retirement solutions.

The company takes pride in its ability to give retirement advice as a fiduciary, as well as its sterling customer service record. Recently Betterment & Sure partnered to offer cell phone insurance protection.

M1 finance (2015)

Account Minimum: $100

M1 is a FinTech company determined to reinvent personal finance by offering an automated money management platform that combines investing, borrowing, and banking. Unlike most services, they allow for both self-managed and robo-directed investing.

Earlier, M1’s self-directed investors had to use a combination of brokers, money management apps, and banks to manage different aspects of their personal finances. This directly increased costs and complexity. The FinTech is tackling the challenge by providing investors with a single platform with three integrated tools (Invest, Borrow and Spend) to build long-term wealth, meet medium-term financial needs, and manage short-term spending.

M1 Finance uses smart robo-advising programming to help investors achieve their financial goals. The firm has set itself apart from other tools and platforms by combining elements of traditional online brokerage and existing robo-investor tools. The company is a member of FINRA/SIPC m1.finance/legal and has recently raised $33 mn in Series B funding round.

Robinhood (2013)

Account Minimum: $0

Robinhood is a robo investor platform founded by Vladimir Tenev and Baiju Bhatt. The FinTech makes it possible to make unlimited commission-free trades in stocks, funds, ETFs, options, and cryptocurrencies. Its cash management product helps users to earn 0.30% APY* on uninvested cash and to gain flexibility with a brokerage account. Recently, the company raised $200 million in Series G funding, bringing the firm’s valuation at an $11.2 billion valuation.

Wealthfront (2011)

Account Minimum: $500

Wealthfront provides an automated investment management platform that allows investors to create and manages personalized, globally diversified investment portfolios at a lower cost. Wealthfront provides a nextgen banking service that helps young professionals optimize their savings. It helps users manage their money for both short-term and long-term goals by providing a Cash Account with checking features and high interest, automated investment management, and free financial advice.

The FinTech provides no-fee banking and low-cost investment management through its mobile app. It has raised $204.5 million in funding to date. Recently, Wealthfront introduced Autopilot, a Self-Driving Money service

Ellevest (2014)

portfolio-specific account minimums.

Ellevest was founded in 2014 after CEO and Wall Street veteran Sallie Krawcheck realized financial products weren’t serving women. It was built by women, for women. It is a robo-advisory service designed with the goal of closing gender money gaps, but it welcomes clients of all gender identities and expressions.

Ellevest offers financial coaching, including one-on-one personal coaching options the cost depends on which membership tier user select. All membership tiers come with access to an Ellevest Spend and Save account, a cash management product that operates like a standard checking account, complete with a MasterCard network ATM card.