Robo advisors is the latest market technology that moving financial planning of any business to high levels. The digital platforms offer an automated algorithm that is driven to work without the assistance and supervision of humans. A typical Robo-advisor usually collects the information given by clients on their future goals and financial situations. The process is always done through the online survey, and the data is then used to offer advice and automatically investments for their client’s assets. The Robo advisors was established in 2008 which was the year of the world greatest recessions. Its initial purpose for Betterment was to offer rebalanced assets and within a targeted date fund. This was to provide the investors with the opportunity for passive management of buying and holding investments though using of online interface. Since the 2000s the human wealth managers had used the portfolio allocation software which was automated. But until 2008 the human wealth managers were the only ones who had the opportunity of buying the technology hence the employers opting to use financial advisors so they can benefit from the technology innovation.
The modern Robo-advisors are using the latest advent to completely changing the above narrative to delivering services to clients directly. After almost one decade of development, the Robo-advisors have changed making them able to handle more sophisticated tastes like investment selections. Tax-loss harvesting, retirement planning and others and by the year of 2015 the Robo-advisor to clients hit 60 billion dollars and prediction to hit 2 trillion dollars by 2020. The other designations designed for the Robo-advisors include automated investments management, automated investment advisor, and the digital advice platforms. They all shift towards fulfilling the consumer’s financial technology applications.
Benefits of using of Robo-Advisor
The main advantage for any business that uses Robo-Advisor is they offer a lower-cost, unlike the traditional advisors. By eliminating the human labour, the online platforms provide faster and cumbersome services and fractional cost. The Robo-advisors charges a fractional flat fee of a maximum of 0.5% of the total balance of the client account.
The Robo-advisors are also more accessible than human advisors since they are available 24/7. The only thing you need is an internet connection.
They are also easy to start since the capital is minimal with a baseline of 5000 dollars for a Standard account. Robo-advisors like Betterment don’t have account minimum hence easy for clients to enjoy their numerous package.
The beauty of Robo-advisors is the easiness to operate, and they offer the perfect investment and financial planning. They give you the best automated investment advice.