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Robo-advisors in Canada have been gaining immense popularity over the last few years for bringing a different kind of automation directly to the consumers. These advisors are sophisticated software that helps people decide what kind of investments they should make and after that rebalance those investments regularly. As opposed to an individual choosing the stocks to buy and sell all by themselves, Robo-advisors usually directly invest money in broad portions of the stock market.
A major USP for Robo-advisors is that they cost a lot less than a usual brick-and-mortar advisor because they have minimal human interaction. Moreover, because high fiduciary standards bind them, they have to typically put the interests of their clients ahead of their own, thus making them even more dependable.
Because of these benefits, many investors who want to start off with their investment journey or want to make the overall investment process hassle-free are getting increasingly drawn to these efficient tools to manage their personal finances and investments.
best Robo-Advisor Canada in 2023
Ultimate Guide: Top 5 Best Robo-Advisors in Canada Right Now
1. Wealthsimple Invest
Wealthsimple is one of the most prevalent Robo-advisory services out there. This Toronto-based wealth management firm is the largest Robo-advisor in Canada in terms of the number of customers and asset size and is known for offering an array of exciting products that include services like online brokerage, hybrid bank accounts, automated tax-filing services as well as the recently added cryptocurrency trading platform.
The best thing about WealthSimple is it lives up to its name ‘simple’. It makes the entire investment process a lot simpler as investors can set up and start investing within minutes by paying a fee of 0.4% – 0.5% per year. Moreover, the platform has also evolved considering the needs of its customers so that one can get it all in one place without visiting multiple sites. For instance, the company recently launched Wealthsimple Cash, a high-interest savings account.
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ModernAdvisor might be a much smaller player in this space, but it is one of the best Robo-advisors for beginners. The company offers Robo-advisor services, an attractive investing platform, and several passive investment options at a low cost. This low service cost makes it suitable for almost all kinds of investors.
ModernAdvisor manages the first $10,000 free of cost. Unlike other Robo-advisors, it offers beginners a no-risk $1,000 trial period where they can earn actual returns. Investors unsure about investing with Robo-advisors can opt for this free trial period to understand how the whole Robo-advisor process works without risking any of their own money. Moreover, it comes with ten different portfolios based on one’s risk profile which is simply sufficient to cover the majority of investors in Canada. Also, those requiring complex financial advice can opt for a dedicated Certified Financial Planner after paying some additional fees.
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3. Nest Wealth
Nest Wealth is well known for its transparency and fixed-pricing tiers. Investors love the services this Toronto-based digital wealth management platform provides as it adds a personal touch to the customized portfolios. Nest Wealth is highly user-friendly and guides the investors through an automated wizard guide throughout the signup process and eventually leads them towards building their portfolios. This tailored service asks customers their age, investment capital, saving goals, time period, etc.
One feature that sets Nest Wealth apart from its competitors is its approach to pricing its services. It has a unique flat fee structure and is the only one in Canada to offer monthly, flat-rate pricing. Although this flat fee structure might seem confusing to many, it is suitable for affluent investors. One needs a minimum investment requirement of $100 to open a Nest Wealth account. Further, it doesn’t have cookie-cutter portfolios and customizes them as per the investor’s needs.
Justwealth is the perfect choice for every kind of investor. This means that even if one does not find a suitable portfolio option with other Robo-advisors, they are likely to find it with Justwealth. The Toronto-based investment firm has over 70 different ETF portfolios. Therefore, investors are bound to find something that suits their risk profile.
There are trained financial professionals to assist investors in finding the right portfolio. Also, one gets a dedicated portfolio manager who they can call at any time for financial advice. Moreover, it also has tax-efficient portfolios for non-registered accounts and income portfolios for retiring ones.
5. RBC InvestEase
RBC InvestEase is a Robo-Advisor backed by the Royal Bank of Canada. Due to its excellent customer service and financial product options, many investors get drawn to its reliable and secure investment service. RBC provides investment advice based on the answers one gives to their questionnaires and invests their money in ETFs.
RBC InvestEase has two types of ETF investing portfolios, i.e., Standard and Responsible. While Standard comes with a traditional ETF portfolio with an MER of 0.11% to 0.22%, Responsible has the socially conscious ETF portfolio with an MER rate of 0.18% to 0.30%. Although the investing fees might seem to be a bit on the higher side, the good thing is customers will be able to avail RBC’s team of investment advisors every time they need.
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Robo-advisors are a must-have tool for today’s investors. They make investors’ lives much more convenient by eliminating much of the research, stress, vigilance, and emotions associated with picking stocks and managing an investment portfolio, all while charging only a fraction of the fees that traditional fund managers typically charge.
All the Robo-advisors mentioned above are among the best on the market today. Canadians who are looking for a Robo-advisor for their portfolios can choose any one or more of the options listed above.
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