First and foremost, what is robo advisors? Robo-advisors or Robo-advisers are a type of financial adviser that provides financial advice or Investment management advice online with very minimal human interference or help.

Have we truly lost the plot abusing the innovations of great men such as Steve Jobs and Bill Gates? Have we become completely inundated with technology?

There are pros and cons to everything in life, so in short, we’ll analyses the virtues and vices of Robo advisors.

One of the advantages of robo-advisors is that they are cheap alternatives to traditional human advisors. As with all industries when you cut out human labor, an automated machine can the same services at a fraction of the cost. This means that Robo advisors can charge a very low annual flat fee of 0.2% to 0.5% of a client’s total account balance. The rate of a financial planner is however a typical one percent % to two percent, this could increase for accounts that are commission based. Robo-advisors offer more accessibility. They are available day or night all you must do as a user is just have internet connection. It also takes significantly less money to get started. As we all know the minimum asserts needed to register for an account are usually in the hundreds to at-least thousands. However, robot advisors have one of the most popular advisors which has no account minimum. It is no secret that efficiency is another advantage that the online platform has. An example given is that if a client wanted to meet an investor face to face to execute a trade they will have to then explain their needs and fill in paperwork and play the wait game. Now with Robo advisors this can be done with a click of a button. Using a Robo advisors may establish a discipline of financial monitoring that can carry over to budgeting and planning for longer periods of time. This allows you to do your own trading.

Of course, there are some issues with robo-advisors. In general, they can offer a sensible investment management option compared to financial advisors with higher fees. Robo advisors do rebalance your account at the beginning of your investment and the digital investment advisor assigned to you will assess your risk comfortability and will create an asset allocation plan. What this means is that your money is divided into stock investment and bond investment and you have a certain percentage in both. Some robo advisors rebalance monthly, daily or weekly, the downfall is that excessive rebalancing can result in many transactions and fees.

In conclusion despite the cons of investing with robo-advisors, I like the ease and discipline of investing with a robo-advisor for many investors. When choosing to invest with a robo-advisor you must read reviews and choose best one for you. Finally rob advisors help you to keep your money in a safe place and you can be a custodian to your assets.