Robo advisors are financial investing platforms that use algorithms to calculate how to allocate and invest your funds without requiring human interaction. There are many platforms that use robo advisors as opposed to human financial planners and Wisebanyan and Betterment are two of them.
Why You Should Choose a Robo advisor
Robo advisors are the most affordable method of financial investing platforms because they use computer-generated algorithms to make investments according to your goals. With robo advisors, clients don’t need to contact a human financial advisor as frequently, if ever.
Robo advisors also require very little, if any, account minimum. This means you can open a new account with a minimal deposit amount. Additionally, you don’t have to be a financial guru to make investments. They require little knowledge about how to make investments or allocate funds. The algorithm within the robo advisor platform will take care of this for you.
Choosing a robo advisor that makes the most out of your investments is just one factor you need to consider when choosing a robo advisor. You should also consider management fees and what kind of support the robo advisor can offer you.
Wisebanyan vs Betterment: Which Should You Choose?
Wisebanyan and Betterment each have something to offer their potential clients. Both platforms have fees, investment accounts and options, a human advisor, and various educational information, so it’s important to understand the ins and outs of both platforms so that you can decide which one is best for you.
The Fees
Let’s start with the fees first because this can be a make-it or break-it moment when choosing any kind of service but especially an investing platform.
Betterment
Betterment has two plans you can choose from, digital or premium, and both plans cost a monthly fee.
The digital Betterment plan has a 0.25% annual fee of your total assets and includes the following features:
- Low-cost ETFs
- Socially responsible options for investing
- Accounts include joint accounts, IRA accounts, and trusts
- Portfolio rebalancing
- Dividend reinvestment
- Auto-adjusting investments and managed portfolios
- Tax-loss harvesting
- Checking and cash reserve deposits with no additional fees
The premium Betterment plan has a 0.40% management fee of your total assets with no account minimum and includes the following features:
- All features listed above in the digital plan
- Unlimited calls with a team of Certified Financial Planners
- Investment advice from a Certified Financial Planner
- Checking and cash reserve deposits with no additional fees
Wisebanyan
Wisebanyan has one plan that costs investors a 0.24% management fee per year with a $500 account minimum and includes the following features:
- Tax-loss harvesting
- More than 30 asset classes
- Accounts include traditional IRAs, Roth IRAs, and SEP IRAs
Where Betterment and Wisebanyan differ is in the account fees. Wisebanyan charges a hefty $75 account transfer fee when you transfer funds out of your account, so keep this in mind when you are considering Wisebanyan vs Betterment.
The Investment Accounts and Options
Wisebanyan and Betterment both offer several ETF asset classes for investors to choose from. Wisebanyan has 11 ETF classes and Betterment has 12.
Wisebanyan and Betterment investment accounts and options are similar. The main difference between the two lies in that Betterment offers a socially responsible investment option whereas Wisebanyan doesn’t offer this type of investment account.
The Betterment socially responsible investment option allows investors to invest in areas that will make an impact in our world. This includes a climate impact, social impact, and a broad impact.
The climate impact is made by investing in companies that fund green projects and use fewer carbon emissions while divesting from fossil fuel reserve-holders.
The social impact is made by investing in companies that promote the empowerment of minority and diversity groups such as $NACP and $SHE.
The broad impact is made by investing in companies that help the world by having lower carbon emissions and ethical labor management.
Human Financial Advisor and Account Support
When it comes to account support, the biggest difference between Wisebanyan and Betterment is that you have better access to a human financial advisor with a Betterment premium plan. Betterment has a team of Certified Financial Planners (CFPs) that will answer any question you have about investing, financial planning, asset allocation, and much more. You can contact a Betterment Certified Financial Planner or customer service specialist on Monday through Friday between 9:00 am and 6:00 pm and on weekends between 11:00 am and 6:00 pm.
Wisebanyan also offers telephone and email support Monday through Friday between 11:00 am and 7:00 pm Eastern Standard Time. This support may be limited and not as thorough as the support you get with a Betterment Certified Financial Planner.
Educational Information, Features, Resources
Betterment also has Wisebanyan beat when it comes to educational information and resources. Betterment has a variety of resources that help you better understand where, when, and how to invest your funds. Even though Betterment is a robo advisor, you still have the option to control your investments. You don’t have to rely on the algorithm to do all the work if you don’t want to.
Because Betterment understands that investors like to control their investment portfolio, they have designed helpful resources like their RetireGuide that can help you stay on track if your investment goal is for retirement. They have also created a SmartDeposit tool that makes scheduled deposits from your checking account into your investment account.
Wisebanyan doesn’t have as many of these features, but that doesn’t mean you should count them out. Wisebanyan’s main selling point is that they are suited for beginners. You can be a young adult who is simply looking to begin investing. All you need is to make a deposit and Wisebanyan will do the rest based on your goals, risk tolerance, and age.
So, What’s Your Choice?
Is the simplicity and convenience of Wisebanyan enough, or do you prefer a robo advisor that gives you more control over your investments? That’s really what it comes down to. The affordability and simplicity of Wisebanyan make it the likely option you should choose. However, if you want a more hands-on approach to your investments, then you should consider Betterment.
For more information about commission-free investors or robo investors, check out our article about Betterment vs Robinhood or M1 Finance Vs Robinhood.
