Some young investors love the idea of this Robo-advisor. Most of them are considering using this technology to help in their investments and financial goals. What’s more, most Robo-advisors companies are urging and targeting millennials and younger generations to use their digital platform.
Learn more about Robo-advisors at ROSHI.
What is Investing Like Before Robo-Advisors
Before the Robo-advisors are here, investors are hiring financial advisors or making DIY strategies. Young investors can make several mistakes, and trading stocks can be overwhelming. They can fall victim to their emotions and quit what they started.
On the other hand, hiring financial advisors can be expensive or lead to hefty fees. As a young investor with small capital, this might not sound right. Apart from that, they couldn’t promise that they will do a great job by returning profit to your investments.
That’s why Robo-advisor is one of the helpful platforms that will make investing much more manageable. There’s no attachment needed. Moreover, there is no minimum balance to start trading.
Young investors are not the only ones who jumped on the trend of using Robo-advisors. Even large companies, such as Fidelity and Vanguard, use them for their investments.
How Robo-Advisors Help Investors
When you read about Robo-advisors’ articles, you will realize that they stand in a debate–whether it is a reputable platform or not.
The Robo-advisors applications and websites have intuitive user interfaces, which makes them easy to use. You can set up your retirement goals and contribution in a matter of minutes. They also use automation that will help you remember your contribution and send them on time.
Another reason why Robo-advisors are attractive to the younger generation is that most do not require a minimum investment. For example, if you only have $20 left from your monthly salary, you can still deposit and invest it in your account.
Some Robo-advisors increased the minimum deposits to $1000, $5000, or more. But there are still other options that accept $1, $5, or $100 as the initial deposit.
Human advisors are usually charging 1% or more for the annual management alone. In comparison, the Robo-advisors ask for as low as 0.25% per year. Most of them also offer no transaction fees and free trades.
The Downside of Robo-Advisors
Despite these Robo-advisors’ advantages, it is still challenging to use this for your overall investment techniques. And whether it would get the return on their investment, the answer is yet to be discovered. It is pretty new compared to the traditional way of investing. It also cannot fully replace a human.
But there is a good news! You combine both the Robo-advisors and traditional methods of investing to get better results.
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