Rise of the Robots
Date: May 21, 2021
Making decisions is hard. Making financial decisions is harder. Understanding investments, deciphering convoluted terms, keeping up with stock changes… for many people this is enough to dissuade them from entering the intimidating world of investing.
Enter Robo-advisors. Robo-advisors are automated, algorithm driven services that help make financial decisions on behalf of the user. They simplify complicated processes and make decisions customers might not be comfortable making on their own and thereby allow them to still participate in investments without needing to fully understand what is going on. Not to mention they are cheaper and more accessible than traditional financial advisors.
How do they work? In most cases a customer shares their basic investment goals through a set of questions that will allow the robo-investor to work their algorithm in a way that then works best with the customers goals. After that? The Robo-advisor goes to work. Though for a small price of course, not even robots work for free.
There are of course limitations to robo-advisers and while they are great for investing, they should not be used for more complicated processes like estate planning. But they do offer an easy and affordable way into investing.
Here are a few robo-advisers you should check out:
- Ally Invest