In our Guide to Getting Started Investing, I strongly recommend Robo-Advisors as the best way for most people to get started investing. Robo-Advisors automatically purchase and manage Exchange-Traded Funds (ETFs) for you. But what is the best Robo-Advisor?
Comparison of Robo-Advisors
Below is a comparison of the most popular Robo-Advisors in Canada. Note that the fees column does not include MER. This is the fees that the ETFs themselves charge. MER will vary depending on which portfolio is selected.
|Comparison of Robo-Advisors in Canada|
|Robo-Advisor Name||Fees (Not Including MER)||Average MER||What's Unique|
|BMO SmartFolio||0.40% - 0.70%||0.20% - 0.35%||Offered by a Major Bank|
|JustWealth||0.40% - 0.50%||0.20%||Dedicated Portfolio Manager to help you|
|ModernAdvisor||0.35% - 0.50% + $499 Setup Fee||0.18%||Low MER Costs|
|NestWealth||$20 - $80/month||0.20% - 0.35%||Flat Monthly Fees|
|RBC InvestEase||0.50%||0.11% - 0.22%||Lowest Flat Fees Offered by a Major Bank|
|CI Direct Investing||0.35% - 0.60%||0.18-0.30% (ETF Portfolios)||Personal Financial Advice and Private Investment Portfolios|
|Wealthsimple||0.40% - 0.50%||0.20%||Most Popular Robo-Advisor in Canada|
|QuestWealth Portfolios||0.20% - 0.25%||0.11% - 0.23%||Lowest Fee Robo-Advisor in Canada|
Lowest Fees - Questwealth Portfolios
|QuestWealth Portfolios- Get Your First $10,000 Managed for Free with Questwealth - After your first $10,000, fees are just 0.25% - After $100,000, fees decrease to 0.20%|
You are likely choosing a Robo-Advisor instead of mutual funds to save on fees. So why not choose the one with the lowest fees? Questwealth Portfolios charges just a 0.25% on the first $100,000 invested, and 0.20% on amounts greater than $100,000 invested. Additionally, Questwealth Portfolios are run by Questrade, one of Canada's most trusted online brokerages.
Best for Financial Advice - CI Direct Investing
|CI Direct Investing - Get Your First $10,000 Managed for Free with CI Direct Investing - Features a Certified Financial Planner® professional at No Additional Cost - Fees Range From 0.35% to 0.60% Based on Your Portfolio Size|
CI Direct Investing sets itself apart by providing easy access to Certified Financial Planner® professionals that aren't just focused on your portfolio. They are willing to assist you in financial planning, retirement income planning, estate planning, analysis of insurance needs, tax optimization, and more. CI Direct Investing may have slightly higher fees than some other Robo-Advisors, but this financial advice and planning is included and may be a valuable asset to your financial health. CI Direct Investing also uniquely provides Private Investment Portfolios (through Nicola Wealth) that have higher MERs (1.00-1.55%) but give you access to investments that typically aren't available through robo-advisors. With broad diversification intended to reduce volatility, and income-generating assets included within the portfolio, these portfolios aren't as impacted by the stock market's highs and lows (vs. a traditional portfolio comprised of stocks & bonds). All this is packaged in a sleek web and top-rated mobile app experience (available on iOS or Android).
Best for Large Portfolios - NestWealth
|Nest Wealth- Portfolio Is Uniquely Matched Based on Your Investing Style and Goals - Flat Rate Fees That Vary From $20 to $80 a Month - This Fee Format Is Best for Large Portfolios|
NestWealth is unique among Robo-advisors due to its subscription-based pricing scheme. Rather than being charged a percentage of your portfolio balance, NestWealth charges flat monthly fees ranging from $20-80/month. For example, with a $500,000 portfolio, NestWealth's $80/month fee works out to just 0.192% of your portfolio. This makes it a great choice for large portfolios, where 0.4% would be almost double the fees.
Best Overall - Wealthsimple
|Wealthsimple- Wealthsimple is Canada's Most Popular Robo-Advisor - Features Options for Socially Responsible and Halai Investing - Fee Is 0.50% for Your First $100,000 and 0.4% Thereafter|
It's not the cheapest nor the most unique, but there's a reason it's the most popular Robo-Advisor in Canada. Wealthsimple is a solid offering with reasonable fees, an easy-to-use website and app, and is transparent about its offerings. Additionally, Wealthsimple has other financial products including a commission-free online brokerage and a savings account.