Best 5 Robo-Advisors for Retirees (2024)

Discover the Pros and Cons

Life has changed drastically over the last few years. Better medical technology means that most people are living longer than their relatives two generations back, which leads to more time spent in retirement. That means that your money needs to last longer in retirement. As lifespans improve, so do investment management choices. And that’s why you might benefit from automated investing with human financial advisors.

Although not retired yet, I am getting closer and have accounts at three Robo-advisors myself!

What is a Robo-advisor?

A Robo-advisor is a broad category of digital financial advisors. These money and financial managers create diversified investment portfolios guided by sophisticated computer algorithms.

The investments are automated by the Robo-advisorto fit specific investment criteria and are based on the well-respected modern portfolio management theory.

Many Robo-advisors offer not only computerized financial management, but also access to human financial advisors. Some also offer high yield cash accounts and borrowing. Most retirees will appreciate access to financial advisors for the money questions that arise. These digital portfolio managers are also known for lower management fees than traditional financial planners.

What are the benefits of Robo-advisors for retirees?

One of the strengths of Robo-advisors is that they are customizable. Retirees benefit from the ability to rev up the aggressiveness in their portfolios, or tone it down to preserve capital for the long term.

Even better: most Robo-advisors are cheaper than traditional investment advisors, making them a great choice for those nearing (or already in) retirement and looking to minimize investment fees.

• Some Robo-advisors like SigFig will manage your investments in your existing accounts.
• While most will transfer your existing assets to their platform, in a manner that will minimize tax liabilities.
• Some Robo-advisors provide access to human financial advisors.
• Robo-advisors typically manage your money with lower feesthan human financial advisors.
• Robo-advisors take the guesswork out of picking your own investments.
• Diversified investment accounts like retirement accounts, trust accounts and taxable brokerage accounts are typically available.

Before making any investment decisions, it’s always important to consider your unique situation. Learn about these five excellent choices, and choose the best Robo-advisor to manage your retirement funds.

Major Brokerage Firms

Most of the major brokerage firms also offer low cost managed investment accounts. Some of these offers are all digital, like Schwab Intelligent portfolios, Fidelity Go and Vanguard Digital Advisor. While most also have a premium version with higher fees and access to financial advisors. A benefit of selecting an investment manager affiliated with a large brokerage firm is that you'll have ready access to self-directed investing, well trained financial consultants and a breath of other resources.

Robo-advisors from major financial brokerage firms:

• JP Morgan Automated Investing
• Fidelity Go
• Merrill Edge Guided Investing
• Schwab Intelligent Portfolios
• Vanguard Personal Advisor Services
• Wells Fargo Intuitive Investor

Wrapped Up

Many retirees prefer to free up time to enjoy their lives instead of handling their finances. Or you're looking to cut investment management costs by switching to a lower cost solution. Digital investment managers are an ideal tool to aid retirees with their financial management. Whether you like the idea of adding customized ETFs to an all-digital managed portfolio at Wealthfront, or the full service financial planning equivalent at Empower, there's a Robo-advisor for you.

Before making any moves to or between Robo-advisors, be sure to consult your existing investment agreement. You may have some transfer fees. If you sell appreciated investments in taxable accounts, you'll also have to pay taxes on the gains. Still, since robo-advisors are often more affordable than their human counterparts you might find these transfer fees and taxes insignificant in comparison to the money you’ll save on reduced money management fees.

A final positive feature of Robo-advisors for retirees: most come withhuman supportto help you navigate the shift. The best Robo-advisors for retirees, after all, are those that will help make this process easy and headache-free.

Ultimately, investing in a Robo-advisor in retirement is a step towards lower fees, greater wealth and a simpler life.

Related

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• Ellevest Review - A Robo-Advisor for Women

• SigFig vs Empower

• Robo-Advisors vs Index Funds

• Robo Advisor Comparison Chart

• M1 Finance vs Robinhood

• Best Robo Advisors For IRAs - Traditional, Roth, Rollover and Business

*Disclosure: Please note that this article may contain affiliate links which means that - at zero cost to you - I might earn a commission if you sign up or buy through theaffiliate link. That said, I never recommend anything I don’t personally believe is valuable.

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*Betterment is not a licensed tax advisor. Tax Loss Harvesting+ (TLH+) is not suitable for all investors. Read more at https://www.betterment.com/legal/tax-loss-harvesting and consider your personal circ*mstances before deciding whether to utilize Betterment’s TLH+ feature. Investing involves risk. Performance not guaranteed.

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