Www.wealthfront

WealthfrontFounded in 2008, Raised 129.5M

Another large robo-advisor with $5 billion assets under management

Get 15k managed for free
Get an additional $5,000 managed free for a total of $15k managed for free (The default offer is 10k managed free)

Details

Min. Investment
$500
Est. Return

Fee

Free if balance <= $10,000

0.25% per yr for balance >= $10,001

Risk
Liquidity
Portfolios are from our actual Wealthfront account

Portfolios

  • Stocks 91%Bonds 9%Cash 0%
    8.18%
    Avg. annual return since 2013

    View Portfolio

Comments

  • F742c7a6d57fb9329c21970ebd98187f?s=100&d=identicon
    Osman Khwaja
    10 months ago

    Been a user for ~1 year. Solid choice for my use case as a "set and forget" robo-advisor with a recurring monthly deposit. They have other features I haven't tried, including the connected accounts dashboard. The interface is nice and user-friendly but I'm not a heavy user. The free tier of 10k in fee-free (shameless plug: use this link http://wlth.fr/1LFMHjg for an extra 5k free) is great option for smaller accounts, making it cheaper than Betterment when getting started.

    Other notes: I have harvested a couple hundred dollars in tax-losses even with my smallish account. I'm looking forward to getting that back during tax season. Hoping that the process is simple

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  • D900a8097677a4e40a59b07da048c4ad?s=100&d=identicon
    gxti
    10 months ago

    I'm moving my money out of Wealthfront, not because it's bad, but because it's not for me. It depends on how interested you are in micro-managing your asset class allocations. If you just want to plop down some money and forget about it, WF is fine. Especially if you have less than $15k.

    Reasons I'm leaving:

    No way to take into account my holdings outside of WF. I have a Fidelity 401k with limited low-fee options, which means I have a lot of stocks and bonds there. I'd like to have more REITs and dividend stocks in my Roth IRA to compensate, because it's more tax-advantageous to put those taxable gains in a non-taxable account, but WF can't do that.

    Tax loss harvesting, the "big feature" WF offers for taxable accounts, is not as big a benefit as their marketing materials claim. I can't put a figure on it but I suspect it starts out lower than their best case scenario and gets worse the longer the account matures. How can you harvest losses on a handful of ETFs that are all up from where you bought them 10 years ago?

    Tax loss harvesting also generates a lot of paperwork at tax time due to all the trades. Granted this should be a tax preparer's problem but I'm stubborn and keep doing my own taxes. It can also step on the toes of my non-WF accounts like the 401k if there's any overlap, resulting in a hard-to-detect wash sale since the 401k isn't going to sell any assets for decades unless I roll it over.

    Their "direct indexing", which buys 100 or more stocks that make up an index and does tax loss harvesting against that is a much more interesting feature but that requires $100k which is 2-3 years away for me, and I'd rather be putting that money into maxing my 401k first anyway. It also would generate several orders of magnitude more of the aforementioned paperwork. I would probably have to buy a GainsKeeper subscription just to keep track of all the trades going on and make sure I'm not accidentally cheating the IRS.

    Tax loss harvesting and direct indexing are useless for tax-advantaged retirement accounts, so WF is basically charging 0.25% just to buy ETFs for you. Vanguard will do this for free.

    Reasons you might want to use Wealthfront anyway:

    You put your money in and forget about it. Nothing to worry about, no ongoing choices to make. If you get glass-eyed and slack-jawed at a list of mutual funds, this is a significant benefit.

    0.25% is really quite a small fee. I have $60k in my taxable account and the fee is currently $10/month. It's a small fraction of even a worst-case long term market growth figure.

    Reasons why you could use Vanguard and still be just as happy:

    If you have $1000 you can buy into a "target retirement date" fund, and get pretty much exactly the same thing with no fees at all.

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  • D0cac99a2f5ec25787fa91ca029da746?s=100&d=identicon
    some_yuppie
    10 months ago

    I've been using Wealthfront for the past ~8 months and I am pretty satisfied with it. I'm impressed with the loss harvesting function. I signed up via a referral link so I have $15,000 managed for free. I don't plan on putting more than $15,000 in this portfolio, thus never triggering the management fee.

    I'd use Wealthfront for learning purposes, I don't think it's worth the 0,25% fee beyond that.

    My father gifted me a Fidelity account that once held my UTMA account. You can trade Fidelity ETFs, iShares ETFs, and Blackrock ETFs commission-free with Fidelity. Vanguard is also a great option for low fee ETFs.

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  • 8eb0538f851622b1c3fa99b0ad4e3533?s=100&d=identicon
    spacedisco88
    7 months ago

    I have a wealthfront account and a vanguard account. When i first started investing i used wealthfront and i'm happy with that choice. They give you a solidly diversified portfolio and prevent you from making a bunch of beginners mistakes. Also, FWIW the wealthfront website is really nice.

    I learned a lot, weirdly, just by watching wealthfront passively invest and balance my account. This kind of regular maintenance and emotionless behavior is basically what you want to replicate if/when move to Vanguard.

    Wealthfront charges no fee on balances below 10k so it's a good way to get started. Personally, now that i've exceeded 10k I'm moving to Vanguard. I've been reading a lot about investing and feel ready to take more DIY approach.

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  • A7397aea42e8e4d9e4d4d78c53bb20dc?s=100&d=identicon
    Ryan Jones
    6 months ago

    Why do you all think Wealthfront is underperforming the other robe-advisors? I have $30k there but just found your site and that is concerning.

    2 Replies

    • 4a042b8382a008d344561c8301509f3a?s=100&d=identicon
      Matthew Hui
      6 months ago

      Wealthfront has been underperforming other robo-advisors because they have a larger allocation in international stocks, more specifically emerging markets such as Brazil, Russia, India, Taiwan, and China) and international stocks have been underperforming US stocks in the last few years. Keep in mind that international stocks can outperform US stocks in the coming years so it's hard to know whether or not having a larger allocation of international stocks is smart.

      If you look at the performance data for 2017, Wealthfront's seems to match the performance of the other robo-advisors. I use Wealthfront as well and would just stick to it.

      You can see the allocations of the different robo-advisors here: https://senzu.io/investing/robo-advisors and if you hover over each ETF you can see their performance from 2013-2016 and 2017.

    • A7397aea42e8e4d9e4d4d78c53bb20dc?s=100&d=identicon
      Ryan Jones
      6 months ago

      Thank you Matthew. That makes perfect sense. I appreciate your thoughtful answer and this site. Great work :).

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  • 250512b4bc49738619af08d02187e460?s=100&d=identicon
    Will Osteen
    about 2 months ago

    I recently signed up with Wealthfront to save money in a no hassle way. Deposits from my bank account are automatic, and get distributed by Wealthfront into a diversified portfolio. Fees are very minimal. I think it's great that they manage up to $10k for free or $15k with a referral. (Shameless plug https://wlth.fr/2sEyMEX ). Even after that .25% a year is only $2.50 per $1k over 15k a year. Using back of the napkin math and going with their average return of 7.5% For every $1000 you have invested over $15000 you will be making $75 and wealthfront will only take a $2.50 fee a year. This number might be conservative in this market based on risk factor assessment into your investing and the fact that Wealthfront invests more heavily into foreign assets. For comparison in this market my 401k is up 17% this year and I expect Wealthfront to be trending not to far under that with a higher risk value. My 401k is ran by a roboadvisor as well.

    I did a lot of research into different robo advisors, and found Wealthfront and Betterment to be the most reputable. I went with Wealthfront for their simple interface, lower fees, and higher transparency. I'm going to be overseas without internet access for a while and wanted a platform to automatically invest extra money while I am gone. While it may not be the smartest way to invest, it is definitely the easiest no hassle way that anyone can do without any market research or finance background. I personally think the majority of people should be using a platform like this to invest and save money for their future. I can not recommend Wealthfront enough.

    1 Reply

    • 4a042b8382a008d344561c8301509f3a?s=100&d=identicon
      Matthew Hui
      about 2 months ago

      Agree with what you said. Most people should just setup an auto deposit and not risky trying to pick their own stocks

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