Wealthsimple Review

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There are many robo-advisors on the market today, and Wealthsimple is one of the best that you can get if you’re looking for socially responsible investing opportunities. With a number of account types, investment options, and goal-oriented strategies, and all the benefits of a robo-advisor, Wealthsimple is a viable investment platform. However, is Wealthsimple right…

There are many robo-advisors on the market today, and Wealthsimple is one of the best that you can get if you’re looking for socially responsible investing opportunities.

With a number of account types, investment options, and goal-oriented strategies, and all the benefits of a robo-advisor, Wealthsimple is a viable investment platform.

However, is Wealthsimple right for your specific investment needs?

Wealthsimple Review: Top Highlights

Wealthsimple logoLaunched in 2014, Wealthsimple is a Canadian robo-advisor. While it sounds relatively new, it is already serving over 100,000 clients and has over $3 billion in assets under management.

The app is accessible to users in Canada, the United States, and the United Kingdom.

To ensure efficient and reliable service delivery, Wealthsimple has invested in a team of refined financial experts and experts from Silicon Valley.

This investing app builds portfolios based on Modern Portfolio Theory, which states that you have to increasingly diversify your portfolio to maximize returns.

Wealthsimple uses low-cost, index-based exchange-traded funds (ETFs) to build portfolios.

In this way, Wealthsimple can create portfolios that encompass thousands of individual securities without having to spend lots of funds. Many of these portfolios are invested in a mix of bonds and stocks.

Wealthsimple Features

The table below presents a summary of Wealthsimple’s features:

Feature Description
Accounts Available
  • Individual and joint accounts
  • Traditional, SEP, and Roth IRA accounts
Free financial advice
  • Investors can consult with a Certified Financial Planner
Rebalancing
  • Wealthsimple rebalances when a portfolio allocation varies by at least 20 percent from the target
Automatic Dividend Re-investing
  • Allows you to maximize the benefits of compounding of investment revenues
Tax-loss harvesting
  • Every taxable account comes with tax-loss harvesting at no additional cost
  • With this feature, you can sell losing positions in a bid to offset taxable gains
Account Security
  • SIPC covers every Wealthsimple account for up to $500,000 in securities and cash
  • Cutting-edge security measures like encryption to ensure the safety of your personal information
Smart Savings
  • Low-risk investment account that offers a higher rate of return than the national savings accounts average
  • Account comes with unlimited free transfers, regardless of the account size
Customer Service
  • Phone or text support on business days from 8:00 AM to 8:00 PM EST
  • Additional customer support is available 24/7 via email

 

Visit the Wealthsimple website to learn more.

What Makes Wealthsimple Unique

What makes Wealthsimple stand out among its competitors is its socially responsible investment (SRI) options and sharia-compliant portfolio.

If you’re looking to put your money in a company that supports a particular cause, such as gender diversity or low carbon emissions, Wealthsimple SRI Portfolios can work well for you.

These portfolios draw from six ETFs that focus on organizations involved in initiatives such as minimizing carbon exposure, promoting gender diversity in influential leadership positions, and clean technology innovation in third-world countries.

The SRI portfolio may also include municipal bonds that promote local projects and government-issued securities that are geared to support affordable housing.

If you are looking to put your money in investments that observe Islamic principles of investing, Wealthsimple’s Halal investing portfolio can work well for you.

The Halal portfolio is composed of about 50 individual stocks that don’t contain any company that is involved in gambling, firearms, alcoholic drinks, or any company that gets a bulk of its income from interest on loans.

If you have a low-risk tolerance, it is advisable to hold a particular percentage of your portfolio in cash because investing in interest-earning assets is not permitted under Islamic law. In fact, that’s the reason bonds are not allowed in the Halal portfolio.

Wealthsimple Products

Besides the SRI and Halal portfolios, Wealthsimple offers two other different types of investment options:

  • Wealthsimple Basic
  • Wealthsimple Black

If the value of your investments ranges from $0 to $100,000, then the Wealthsimple Basic plan would be ideal for you.

With this portfolio option, you get to enjoy:

  • Auto deposits
  • Portfolio rebalancing
  • Tailor-made portfolios
  • Tax-loss harvesting – Wealthsimple will sell your poor performing security, enabling you to offset taxes on both incomes and gains.
  • Dividend reinvesting – You can reinvest your cash dividends into additional stocks or fractional shares.
  • Professional financial advice

Conversely, if you’re looking to invest over $100,000, Wealthsimple Black is for you.

With Wealthsimple Black, you get to enjoy all the goodies from Wealthsimple Basic in addition to the following:

  • Lower service fees
  • Goal-based planning
  • Increased tax efficiency
  • Access to VIP airline lounge

Moreover, Wealthsimple gives its customers access to a Smart Savings account.

With this account, you will enjoy a 1 percent interest rate, no investment minimum, and free funds transfers.

Wealthsimple Sign-up Process

Signing up for Wealthsimple is quite easy. Just follow the steps below:

  • Fill out the online application form with the required information and answer a couple of questions regarding your investment experience.
  • E-sign at least one Investment Management Agreement
  • Enter your account information to verify your bank account

Signing up with Wealthsimple is as simple as that.

You will need to wait for about five business days for your information to be verified and approved, and then you can start investing.

Visit the Wealthsimple website to learn more.

Advantages and Disadvantages of Wealthsimple

Wealthsimple is an excellent platform, but like any service, it comes with a number of pros and cons that are worth considering.

The Pros

  • Socially Responsible Portfolio – This portfolio gives you the opportunity to invest in causes that you are passionate about—not many robo-advisors offer that.
  • Halal Investing Portfolio – This portfolio gives you a chance to put your money in investments that resonate with your religious values.
  • Live Support – You don’t have to worry about having to figure out things yourself when you get stuck. Weathsimple offers reliable live support by phone or text.
  • No Account Minimum – If you are a beginning or small investor with little or no capital to start with, Wealthsimple has got your back as it offers no minimum account balance.
  • Portfolio Review – A comprehensive portfolio review of external investment service is an exceptional functionality. It can help you find out if your funds are being invested efficiently.
  • Access to VIP Airline Lounge – If you travel frequently and love the comfort of airline lounges, this perk can come in handy.

The Cons

  • Expensive – Wealthsimple’s standard fee of 0.5 percent is one of the highest on the robo-advisor market. There are several less expensive alternatives that you can try, such as Wealthfront and Betterment.
  • The absence of a goal setting feature – Wealthsimple needs to have this feature on its platform to compete fairly with its close competitors like Betterment, Personal Capital, and Wealthfront.

Bottom Line

It can be challenging to determine which robo-advisor will best fits your needs as there are a number of great platforms to choose from. You may even find that an online brokerage allowing hands-on trading is more suitable for you.

Most of them have quite similar features and functionalities, so one of the best ways to differentiate between robo-advisors is pricing.

Many investors will go for robo-advisors that charge 0.25 percent but offer virtually the same features. Nonetheless, Wealthsimple remains a frontrunner when it comes to providing specialty investment portfolios.

Its socially responsible investment portfolios are unmatched. With Wealthsimple, you can invest in portfolios that help uphold your values.

Bottom line: you won’t go wrong with Wealthsimple. Which robo advisor you choose ultimately boils down to your goals and priorities.

Visit the Wealthsimple website to learn more.

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About Ryan Guina

Ryan Guina is the founder and editor of Cash Money Life. He is a writer, small business owner, and entrepreneur. He served over 6 years on active duty in the USAF and is a current member of the IL Air National Guard.

Ryan started Cash Money Life in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about military money topics and military and veterans benefits at The Military Wallet.

Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free account here.

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