On Wed, January 26, 2022, Wealthfront announced that information technology has agreed to be acquired by one of the premier brands in wealth management, UBS, in a transaction valued at $ane.4 billion. In a web log post on the visitor's website, David Fortunato, Wealthfront'southward Chief Executive Officer, alleviated an concerns on the role of current and prospective customers by stating, "You will see no change to your experience and can look forwards to benefiting from UBS's latitude of products, services, and intellectual capital. Balance bodacious that aught will change with your business relationship or the cost of our service. Nosotros will continue delivering great products and features to y'all, now at a much faster pace. And you'll become access to fifty-fifty more than research and insights that can empower you as an investor."

Wealthfront, our top choice overall for robo-advisors also as all-time for goal planning, is 1 of the original robo-advisors and currently claims 450,000 users with $28 billion assets under management (AUM). Wealthfront recently upped its game by adding over 200 additional ETFs that users can add to existing portfolios or use to build an ETF portfolio from scratch. Regardless of your investments, the company volition rebalance and manage them on your behalf. Investors looking for cryptocurrency exposure can at present cull to invest in Grayscale's Ethereum or Bitcoin funds, which were part of Wealthfront'southward 2021 additions.

Classic Wealthfront portfolios are now joined past Socially Responsible, Chance Parity, Smart Beta, and unmarried stock indexing options. If y'all're comfortable with a completely online platform, then Wealthfront's lineup offers something for most types of investors. Nosotros'll dig deeper into Wealthfront'southward platform and features to help you lot decide whether it is the correct fit for your portfolio.

New and Notable Updates

  • Wealthfront customers can at present invest up to x% of their portfolios in cryptocurrencies through the addition of the Grayscale Bitcoin Trust (GBTC) and the Grayscale Ethereum Trust (ETHE).
  • Wealthfront has brought new portfolio customization tools to customers, assuasive them to add and remove ETFs, build an ETF portfolio from scratch, and filter investments for factors like ESG.

Key Takeaways

  • Wealthfront is our top choice overall for robo-advisors also equally best for goal planning.
  • Wealthfront's sophisticated digital financial planning tool answers scores of planning questions and is accessible to anyone.
  • Cash accounts offering up to $i 1000000 FDIC insurance.
  • Wealthfront now offers Cadre, Socially Responsible, Smart Beta, Risk Parity, and customized portfolios.
  • The highly regarded mobile app is on par with the desktop version in terms of functionality and ease of utilize.

Pros & Cons

Pros

  • Customize portfolio with ETFs and cryptocurrency funds

  • Direct stock indexing for larger accounts-$100,000 minimum

  • Free digital financial planning tool on a par with human planners

  • Daily tax-loss harvesting

  • 529 accounts bachelor

Cons

  • No homo financial advisors

  • Difficult to connect with a live product specialist

  • No online chat

Company Overview

Account Minimum $500
Fees 0.25% AUM
Goal Planning Goals encompass retirement, home buying, saving for higher, taking fourth dimension off from work, making a big purchase, and receiving a windfall.
Bachelor Avails ETFs, Cryptocurrency funds, individual stocks
Interest Paid on Cash Balances 0.85%
Customizable Portfolio Yes, able to add together ETFs to existing portfolio or create a customized ETF portfolio for Wealthfront to manage.
View Portfolio earlier Funding Yes, simply y'all need to create an business relationship and provide name, electronic mail, and telephone number first.
Customer Service Help Centre FAQ, email, phone
Financial Counselor Bachelor No
Cash Management Yes - high yield cash account
Mobile App Android, iOS

Account Setup

Wealthfront enables you lot to set up an account rapidly, take a brief financial goals and risk quiz, and view a potential investment portfolio. Opening an business relationship with Wealthfront starts with y'all clicking the "Get Started" button on the home folio and selecting either "Invest" or "Banking company." The total process for opening either business relationship type is roughly 4-5 minutes.

After inputting your proper noun, e-mail address, and phone number, your Invest business relationship is created. This is so followed by the get-go part of a risk questionnaire, where the initial questions cover broad goals like general investing, retirement, or education. Unlike a few other robo-advisors such as SigFig, you demand to fix an account to complete the initial questionnaire and view a prospective portfolio.

Afterward completing the initial questionnaire, you'll choose the account ownership structure with options ranging from individual and articulation brokerage accounts, trust, traditional, Roth, simplified employee pension (SEP), and rollover private retirement accounts (IRAs), to a unique 529 account.

Now that yous have a Wealthfront business relationship and a specific type of investment business relationship selected, yous're asked the standard age, income, internet worth, and risk questions. Before viewing your investment portfolio you'll choose either the Classic, Socially Responsible, or Straight Indexing (express to accounts with more than than $100,000) account way.

After selecting the mode, y'all tin then view the recommended investment portfolio for your run a risk level. You're able to view other portfolio options by increasing or decreasing risk tolerance using a slider. You can too choose to further customize the portfolio using "Edit Portfolio" to add together or remove investments. One time y'all're satisfied, the final footstep is linking a bank account to fund the Wealthfront account.

Later linking accounts, you can access Wealthfront'southward comprehensive free digital fiscal planning tool, Path. To really start investing with your Wealthfront account, your account residuum will need to reach $500 before information technology is invested in your selected portfolio.

Goal Planning

Wealthfront's goal planning and financial decision-making tools are among the all-time in our robo-advisor platform reviews. To properly utilize Wealthfront'southward goal planning features, collectively called Path, y'all need to link all of your fiscal accounts to create an accurate picture of your current finances.

Wealthfront investors can choose from the post-obit list of  initial goals:

  • Retirement
  • Buying a home
  • Saving for future education
  • Taking time off from work
  • Making a large purchase
  • Investing a windfall

Information technology's easy to rails progress towards goals. Afterward logging in to Wealthfront, users tin can view their dashboard which shows progress towards goals.  As mentioned, anyone who registers and links their banking and investment accounts tin use the digital financial planning tools. Path draws upon bookish research to project your likelihood of reaching stated goals while taking into business relationship aggrandizement, projected income changes, market operation, and then on. The modeling automatically updates whenever any of the inputs change. This allows Path to approximate the services you might receive from a human fiscal planner, including building a financial plan that sets out how much to save to reach your various goals.

Path is equipped to answer more than than x,000 financial planning questions including:

  • What blazon of domicile tin I afford? Can I afford a home in this city?
  • How early tin I retire?
  • How long can I take time off to travel?
  • Exercise I have enough money to pay for my kid's college?

In addition to helping you lot track the progress being made toward reaching your goals, embedded charts and graphs prove how much your goals will cost. Again, the plan will update with new guidance every time you alter a goal or other key inputs, so y'all tin use Path to run a diverseness of scenarios on your finances. Getting this level of free financial analysis is well worth it, whether you intend to invest with Wealthfront or non.

Account Services

Wealthfront continues to innovate with cash management, borrowing, and the opportunity to customize portfolios past calculation additional ETFs. There are no fees to trade the ETFs and they can exist added to an existing portfolio or used to create a new one.

Cash Management

Wealthfront Greenbacks is similar to a gratuitous involvement-bearing checking business relationship and is available to individuals whether they sign up for the investment services or not. Users can save for specific goals, automate transfers to their investment business relationship, pay bills, and direct eolith a paycheck. Wealthfront Cash sign-up is carve up from the Invest sign-upwards.

Additional features include:

  • Interest-bearing account that currently pays 0.35% and fluctuates based upon movements in the federal funds charge per unit.
  • In-network fee-complimentary ATM transactions.
  • Upward to $ane million FDIC insurance through related banks.
  • App-based mobile check deposits.
  • Unlimited costless transfers.

Through Wealthfront Borrow, users with a minimum of $25,000 invested with Wealthfront in a taxable account are eligible for a portfolio line of credit and can borrow upwardly to xxx% of their account value. There's no credit check required and interest rates range from 2.4% to 3.65%, depending upon your account balance.

There is no payment schedule or constraints on how you lot use the coin. Simply, if your account residuum falls, you may need to add money to your investment business relationship or repay some of the loan.

Portfolio Construction

Portfolios are created past the Investment Direction Committee, including renowned Dr. Burton Malkiel, author of A Random Walk Down Wall Street. The portfolios include low-price alphabetize funds and abide by Modern Portfolio Theory, which strives for the greatest returns at a specific adventure level. The 20 take chances-adjusted portfolios are correlated with a client's goals and take chances tolerance levels and can be easily adjusted as circumstances change.

Nugget classes include ETFs from the following categories:

  • US stocks
  • Dividend stocks
  • Developed marketplace international stocks
  • Emerging market international stocks
  • Commodities
  • Real Manor
  • U.s. corporate bonds
  • Municipal bonds
  • Government bonds
  • Aggrandizement protected regime bonds
  • Emerging market bonds

Wealthfront's portfolio options include:

  • Classic portfolios with a diversified portfolio of low fee index funds
  • Socially Responsible portfolios substitute several ETFs with socially responsible choices
  • Direct Indexing includes private stocks ( $100,000 minimum)
  • Customize with over 200 ETFs to add to existing portfolios or create new ones
  • Hazard Parity portfolio attempts to outperform markets ($100,000 minimum)
  • Cryptocurrency funds from Grayscale (10% maximum of portfolio value)
  • Smart Beta for accounts worth more than $500,000
Available Assets
Individual Stocks Yes-for accounts worth $100,000+
Common Funds No
Fixed Income Yes - ETFs
REITs Yes
Socially Responsible or ESG Options Yes
ETFs Yes
Not-Proprietary ETFs Yes
Mutual Funds No
Private Equity No
Crypto, Forex Crypto funds not individual coins, no Forex

Portfolio Customization

Wealthfront does offer customization options in terms of adding or removing specific ETFs from your recommended portfolio. That said, the company'south ain FAQs and content on the topic tend to discourage making any modifications to the model. More than DIY-inclined investors looking for a robo-advisor that allows yous to tweak a portfolio at a deeper, more than active level will find a more flexible option through competitors like M1 Finance or Interactive Advisors, but with less in terms of overall fiscal planning support.

Portfolio Management

Wealthfront's algorithmic portfolio direction is grounded in best practices and research-supported theory. Portfolio rebalancing is not automatic, merely it is adopted when deposits or withdrawals are made or if the asset allotment significantly deviates from its target. Tax consequences are too programmed into asset allocation decisions. The original Wealthfront portfolios and those with added ETFs or client-customized options are all rebalanced according to this plan.

Wealthfront claims that the daily tax-loss harvesting benefits get-go the 0.25% management fee for taxable accounts. This service is included in the management fee and is bachelor to all investors. The platform sells ETFs with losses and replaces them with an alternate ETF that tracks a different, but correlated index, to maintain the risk and return characteristics. This avoids falling prey to the IRS's Launder Sale rule.

Clients with over $100,000 who participate in the US Directly Indexing receive both stock-level and ETF-level taxation-loss harvesting.

Primal Portfolio Management Features
Automatic Rebalancing When deposits or withdrawals occur and when percentage allocations deviate from their goal.
Reporting Features Tax and monthly statements are available on the website.
Taxation-Loss Harvesting Yes-daily
External Business relationship Syncing/Consolidation Yes-anyone tin can link accounts and receive net worth, saving, spending, and "what if"
planning information.

User Experience

Desktop Experience

The Wealthfront user experience is skillful, with a clean interface and piece of cake access to menu items. The platform bill of fare includes Invest, Cash, Borrow, and Web log categories enabling users to find what they need quickly and readily admission their account. Accessible research, support, and contact verticals circular out the nigh needed features of the platform.

Some users have complained that the linked accounts demand to be re-synced and that they take a few days to update. This is a common trouble amid many fiscal apps that link to other accounts. We experienced some sync issues during our review procedure, but no more than than other services collecting information from multiple financial institutions with varied hallmark processes.

Mobile Feel

The mobile apps are highly regarded on both the Android and iOS platforms. The user experience is good and the apps approximate the functionality of the desktop version. The opportunity for non-Wealthfront users to link their accounts, use the fiscal planning software, obtain financial planning insights, and accept a true 360o view of their spending and net worth is an enormous benefit.

Customer Service

Customer service is available through three venues:

  • Help center with admission to FAQ and a search bar
  • Email
  • Telephone

The Help Center articles and oft-asked-questions are comprehensive. Email is the 2d selection if you can't detect what you need from the Help Center.

The telephone client service number is difficult to find. When you call, there are eight bill of fare options for questions ranging from deposits to investing. When we reached a Product Specialist, he was poised to answer account-related questions.

Although the Production Specialists are not financial planners, they are registered with FINRA and have both Series seven and Series 66 registrations. They might also possess boosted credentials such as CFA, CFP, or CPA.

The company makes it difficult to access a human on the phone and does not offer live financial planners. The expectation with Wealthfront is that you will help yourself using the FAQs and perhaps electronic mail, but other robo-advisors have plant better ways to go along the homo chemical element for those needing it. We found customer service a rare weak spot for Wealthfront after a sometimes frustrating assessment.

Security

Wealthfront takes security seriously with limited access by employees to your information, and a team that actively monitors and reviews security protocols.

  • 2-factor hallmark.
  • Biometric-authentication with touch ID on mobile devices.
  • Wealthfront Cash accounts are protected past $ane,000,000 FDIC insurance through its fellow member banks.
  • Wealthfront Investment accounts are protected with up to $500,000 insurance by the SIPC. This insurance covers upwards to $250,000 in cash. SIPC insurance protects against investment firm failure, not against the normal volatility of the financial markets.

Education

Wealfront's education vertical is strong with a comprehensive blog, educational manufactures, and videos. Guides are available to assist with home buying, higher planning, retirement, and more. The educational content covers how to utilize the portfolio, taxes, financial planning, account types, general investing, and scores of other topics. For investors looking for deeper explanations of how the platform operates, Wealthfront has some first-class blog posts equally well as white papers discussing major elements of the model and some of the research underpinning it.

Commissions and Fees

The Wealthfront investment account charges a 0.25% AUM wrap fee for all accounts, deducted monthly. This is in line with many robo-advisors and significantly lower than the management fees charged past traditional fiscal advisors.

The portion of an account in the run a risk parity mode (maximum of 20% of business relationship value) incurs an additional 0.25% investment direction fee.

In that location are no additional charges for withdrawals, trading commissions, account transfers, or account closings. The "Invite" program gives clients complimentary account direction for a portion of their funds when referred friends fund an account.

The ETFs in the Classic portfolios are low-fee, while all other ETF fees are reasonable for their investment styles. The Grayscale Bitcoin and Ethereum management fees are 2.00% and 2.5% respectively. These are loftier in contrast with stock and bond ETFs but in line with many other cryptocurrency trading fees and products.

Cash accounts are gratis of any fees, only in that location are several fees for the Wealthfront debit card:

  • Out-of-network ATM: $2.l + ATM possessor fee
  • Depository financial institution teller: $2.v + teller fee
  • International transaction fee: two.75%
  • Cash deposits at select retailers: Up to $5.95
Category Fee
Management fees for $5,000 account $12.50
Direction fees for $25,000 business relationship $62.50
Management fees for $100,000 account $250.00
Termination fees $0.00
Expense ratios Average 0.08% to 0.11% for portfolios that include the Wealthfront Gamble Parity Fund
Mutual funds Northward/A

Final Verdict

Wealthfront is the robo-advisor for any level of investor seeking a comprehensive investment management solution for a low fee, as long as you are comfortable with the fully automatic arroyo. The visitor continues to innovate and information technology has grown into a complete financial planning, money, and investment management platform for those comfortable with an all-digital platform. Wealthfront's free financial planning capabilities give it a significant edge in creating value for its users across simply constructing a portfolio compliant with Modern Portfolio Theory and managing it for y'all, which it also does well.

In 2021, Wealthfront made enhancements to its portfolio structure process, addressing previous concerns nosotros had in the area of portfolio customization. This leaves customer services as the merely area where Wealthfront wasn't at or near the top of our rankings. If yous are willing to leave this characteristic backside, however, Wealthfront offers a robust, fully automatic solution for your investment needs and is working towards being a consummate financial solution.

Methodology

Our mission at Investopedia is to provide investors with reviews and ratings of robo-advisors that are comprehensive and unbiased. Our team of researchers and expert writers, led by Michael Sacchitello, spent months evaluating all aspects of a robo-counselor'southward platform, including the account setup process, goal planning tools, account service options, portfolio construction offerings, portfolio management, mobile and desktop user feel, educational content, fees, and security. Every bit part of this evaluation, nosotros extract critical data points that are weighted by our quantitative model that produces a powerful star-scoring organization.

With the individual investor in mind, we've designed a comprehensive ranking methodology to find the best overall robo-advisors and the all-time robo-advisors beyond nine central categories. Each counselor is and then scored across multiple variables to rate functioning in every applicable category. The score for the overall award is a weighted average of the categories