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When I looked at it the fees were way to high to justify to bogelheads. What is strange to me about robo advisors is that they are still charging a management
by prepend 5y ago
When I looked at it the fees were way to high to justify to bogelheads.
What is strange to me about robo advisors is that they are still charging a management fee instead of a flat fee. The algorithms are really basic and don’t have any real time changes so it seems weird to charge 25-50 basis points for what’s basically just an interview and time based rebalancing with some formulas that aren’t really better than existing ETFs.
I’ve been expecting this to just be a feature for vanguard and fidelity since the “advise” could just be client side automation rules that nobody wants to build.
- xur17 5y agoAgreed. To me target date retirement funds honestly make more sense for most people.
- tinalumfoil 5y agoI'm not sure about that. Targets funds fees are generally a percent not flat, you have less control over your money (which if you're doing a robo-advisor you probably have somewhat bespoke investing requirements) and they only make sense for tax-advantaged accounts (see [1]). Plus, people invest for reasons other than dated retirement targets. [1]: https://www.wsj.com/articles/vanguard-target-retirement-tax-bill-surprise-11642781228 https://www.wsj.com/articles/vanguard-target-retirement-tax-...
- teej 5y agoTax loss harvesting alone has more than paid the 25 bps fee that Wealthfront charges. It's a no-brainer to me. I'm very happy with Wealthfront.