As technology for robots and artificial intelligence become more sophisticated, it starts to have a universal place in society’s daily functions—and finance is no exception.
By now, you’ve likely heard of “Robo-advisors,” which are online investing platforms that use computer-generated algorithms to create strategies and manage your money.
Most Robo-advisors are entirely automated, but some also offer access to human assistance. These platforms provide simple portfolio management with little human interaction at rock-bottom prices.
This year, it’s estimated that 3.5 million U.S. adult investors will use a Robo-advisor to handle their portfolio. With the increasing popularity of these platforms, you might be asking yourself:
Do I actually need a *human* financial planner when I could use a Robo-advisor for a lot cheaper?
We think you do.
Here are 7 reasons why you need—and deserve—more than a Robo-advisor:
Reason 1: We Treat You Like a Person, Not An Account Number
When you meet your financial planner face-to-face, you form a strong relationship. Unlike an algorithm, we put you at the center of everything we do.
Our meticulous discovery process thoroughly drills down into your unique personality, goals, values, and needs. By getting to know you, we can help you craft a custom-built strategy that’s entirely designed to help you find success. More often than not, clients have better financial outcomes with a custom process because no two people are wired the same.
Robo-advisors use algorithms to fit you into pre-existing strategies based on your age, risk tolerance, and investment horizon. While that can be a good place to start, there are so many personal nuances that a computer just can’t comprehend.
- What if “life happens” and you need to make adjustments?
- You might have questions about how the process works and the best ways to form healthy financial habits.
- What happens if your goals change?
It’s such a comfort to know that you can call your financial planner and ask them these questions personally, not be stuck in an automated chatbox or endlessly on hold with customer service.
Reason 2: We Keep You Involved In Investment Decisions
At Chladek Wealth, we emphasize ongoing, personalized communication because we believe informed clients make more intelligent financial decisions. We customize our level of communication to your desires and can present you with as little or as much technical detail as you like.
If you sit on the edge of your seat for market updates, we can review those with you, or if you’re more interested in knowing where you’re at with your goals, we can ensure you have the information you need to feel confident and secure about your money.
Robo-advisors target clients who prefer a hands-off approach to investing—one that does not allow for talking through things face-to-face (or camera-to-camera in this day and age).
If hands-off investing is more your speed, that’s completely fine! But it’s often beneficial to have someone in your corner you know you can call when unexpected challenges arise. Plus, if you’re not a bonafide “expert” in investing, it’s nice to bounce ideas off of and receive tailored guidance from a professional.
Reason 3: We Coach, Guide, and Hold You Accountable
Money serves a different purpose for everyone, and that purpose often changes throughout life. At one stage, your money could help you buy your dream home and fund your kid’s education. And a little later down the road, it could help sustain and support your ideal retirement life.
No matter your purpose, a financial planner can help you define it and even hold you accountable for the strategies created together. Think of us as real-life financial coaches or guides.
Your financial journey is not one straight path to success—it’s filled with mountains and valleys that require a support system. Financial planners take you through personalized exercises to better understand your relationship with money and your personal goals.
Robo-advisor algorithms are designed around simplistic variables like age, target retirement date, risk tolerance, and income level. To be frank, a computer doesn’t care if you reach your goals or if you have questions along the way. With a Robo-advisor, you’re just a number.
With us, you’re a real person, with hopes, dreams, fears, and passions; and we are delighted to walk beside you through it all.
Reason 4: We Make Sure Your Financial Strategies Keep Up With Your Life
Financial planners proactively monitor your strategies and update them as your needs change. When you pass one of life’s important milestones, we will know and ensure that your strategy keeps up with your life. Whether you get married, buy a house, or start a family, you can be sure that your financial planner will be ready to help you every step of the way.
With a Robo-advisor, they don’t know when you get married, buy a house, or have a child, so they can’t help you through those stages of life. If your goals change and you need a comprehensive risk management strategy, it’s up to you to do the heavy research. All Robo-advisors do is use automated rebalancing algorithms to make changes to your portfolio, no matter what’s happening in your personal life.
Reason 5: We Provide Knowledgeable Answers From Someone You Know
We offer you easy access to an experienced local professional who knows you and understands your situation. Whatever your case, your financial advisor can get you the answer you need quickly and confidently. Plus, if you want to discuss your issue face-to-face, you can easily do so.
Most Robo-advisors send you to a help desk forum or customer service center when you have questions. Even if a person is assigned to your account, you could be just one of the hundreds they speak with every day. And it may take significantly longer to get the answers you’re looking for. After sifting through articles or waiting for your account manager to get back to you, it could be hours or days.
With a financial planner, we’re just a phone call away.
Reason 6: We Help You With Tax, Efficient Investing, and Insurance Matters, Too
Financial planners take care of your whole financial picture, not just your investments. We can help you with tax-efficient investing, managing your risk, and finding the right insurance coverage through our network of professionals.
Robo-advisor platforms are only designed to handle portfolio management, and they are not equipped to offer tax-efficient strategies or tips on avoiding common tax return errors, for example.
These platforms usually don’t include insurance, healthcare, or real estate in their automated calculations, either.
Reason 7: Your Life Is About More Than Investing
We help our clients prepare for all of life’s important financial milestones: a house, paying off debt, funding a college education, a bucket list, vacation, as well as retirement. The financial decisions you make earlier on have massive impacts on your future, and financial planners help prepare you for that.
Robo-advisors are designed to focus primarily on investing. For our clients, comprehensive wealth strategies are about much more than just their investment portfolio—it’s just one piece of an enormous puzzle.
Find The Human Spark
The good news is that you don’t have to forego the benefits of working with an online investing platform when you work with a financial planner at Chladek Wealth.
Through our robust technology platform, we offer many of the same features and benefits that our online competitors do, but with a human touch—and that’s something you just can’t beat.
It’s time for a more effective, personalized financial plan. Get in touch with our team today to get started!
The contents of this article are for general information and educational purposes and should not be construed as specific investment, financial planning, tax, accounting, or legal advice. Please consult with a professional advisor before taking any action based on the contents of this article. All investment and financial planning strategies involve risk of loss that you should be prepared to bear. We cannot guarantee any investment performance whatsoever, and past performance is not indicative of potential future returns.