SigFig at a glance
Pros: Where SigFig stand out
Management and account fees
SigFig customers will be able to take advantage of one of the best aspects of investing with a robo-advisor: low management fees relative to traditional financial advisors. SigFig doesn’t charge you any management fee on the first $10,000 in your account and it’s just 0.25 percent annually after that, in line with industry leaders like Betterment and Wealthfront.
You also won’t get dinged with annoying account fees for things like inactivity, terminating an IRA or transferring your account. These fees ultimately eat into your return as an investor, so eliminating them altogether is a great feature and consistent with SigFig’s low-cost approach.
Many other robo-advisors come with fees that can run over $100 combined for various actions.
SigFig also earns high marks for having low-fee ETFs in its portfolios. Robo-advisors generally come with two types of recurring fees: an annual management fee that goes to the robo-advisor itself, and the annual expenses for the ETFs used to build portfolios. Both fees eat into your returns, but people sometimes forget about the fees associated with the ETFs.
SigFig uses a group of 23 ETFs to build portfolios and ultimately includes eight in each one. Annual fees range from 0.07 percent to 0.15 percent for the ETFs, which puts it close to industry leaders. Vanguard Digital Advisor, known for being a low-cost champion, uses ETFs with expense ratios of 0.03 percent to 0.08 percent.
The 23 ETFs SigFig offers is more than what most robo-advisors use to build portfolios, with many relying on fewer than 10. Having these additional ETFs available makes it easier to build a portfolio that fits with your specific needs and investment goals.
You’ll also receive features that have become more common among robo-advisors like automatic rebalancing and tax-loss harvesting. Rebalancing your portfolio when allocations drift is an important part of managing risk and SigFig will handle it without you having to think about it. And by implementing tax-loss harvesting, you’ll be able to use investment losses strategically to reduce your overall tax bill.
Human advisor access
One major bonus that SigFig offers is unlimited access to investment advisors. Once you reach $10,000 in assets, you’ll be able to schedule an appointment online or over the phone and get all your questions answered by a professional. Speaking to an actual human expert is becoming more and more rare in our increasingly digital world. There are some questions that are better handled by a human than an online chat robot.
While there are some other robo-advisors that offer access to human advisors, that can sometimes come at a higher tier of service. Both Betterment and Schwab Intelligent Portfolios provide access to financial advisors at their premium service tiers, which also come with higher annual fees. SigFig offers access to clients for no additional charge.
SigFig gets a lot right with its robo-advisor offering. While some features are missing that would put it in the upper tier of the industry, it handles the basics well at a reasonable price.
- Low fees. SigFig comes in near the low-end of the industry when looking at fees of all kinds. Both the annual management fee and fund expenses are low, which help more of your money stay with you. You’ll also avoid those pesky account fees for transfers and IRA terminations.
- Access to human advisors. Being able to ask your questions to a professional for no additional charge is a nice feature that isn’t common across the industry. Those that do offer access to human advisors often restrict it to clients in higher service tiers, which comes with additional fees.
If you’re looking for a robo-advisor that offers the complete package, including features like cash management accounts and fractional shares, consider Wealthfront or Betterment. Those looking for rock-bottom fees should check out SoFi Automated Investing or Vanguard Digital Advisor.
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