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17 February, 2020 / Mon, 3:30 am

Date: 30.07.2019.

Invest with a Robot Advisor

Looking to get involved in investing


Looking to get involved in investing, but don’t fully trust your own instincts or have the money to pay an investment advisor?

Then investing in a robo-advisor might be a great way for you to improve your passive income potential with low-risk, algorithmically selected investments. Don’t have any idea what we’re talking about? Don’t worry, we’ll explain.

Acorns is one of the most popular robo-advisors out there and one of the easiest ways to start investing. They round up all of your credit or debit purchases to the nearest dollar and they invest that change into a portfolio for you. We will also cover other options later.

What is it?

A robo-advisor is an automated online investing system. Still confused? Basically, a robo-advisor uses math and algorithms to invest your money for you.

Rather than relying on the instincts of some financial ‘expert’ to try and predict where the market is headed, a robo-advisor uses a complex system of algorithms and data to determine the best way to make safe, high-yield investments over time.

They used to be the domain of large investment firms, but more and more banks are offering them to their users.

Robo-advisors offer you a great deal of customization in terms of how they handle your investments, including how often they can rebalance your portfolio, how much leeway they have with investing your funds, and other parameters.

Who is it for?

The average robo-advisor will require you to invest a minimum of $500, so keep that in mind when on the hunt for the right one for you.

The good news is that they can help you manage a wide range of investments, including everything from stocks to trusts and 401(k)s.

You’ll also appreciate that every robo-advisor begins with an in-depth questionnaire. This is designed to help it understand your willingness for risk, preferences for investment, and what kinds of portfolios you’re most interested in pursuing.

From there the robo-advisor will form a profile of you and use it to pursue your best interests.

Generally, robo-advisors create your investment portfolio around low-cost exchange-traded funds, also known as ETFs, as well as index funds.

How does it pay?

We don’t want to toss around any hard figures here, as how much you can earn with any investment is based on a wide range of factors including the amount of initial investment, types of investments, market behavior, and other parameters. But smart use of a robo-investor can lead to significant earnings over time, even if it doesn’t result in a huge immediate windfall.

According to a CNBC report regarding average returns across five different robo-advisors, there’s a fair bit of variation when it comes to the kind of ROI you can expect.

When looking at standard accounts with a 60-40 split between stocks and bonds, Acorns, for example, offers an average of a 9.08% return while Betterment tends to float around 6.5%. Other robo-advisors can offer similar returns.


  • Perfect for those with little to know investing experience, as your investment is handled completely by an algorithm-based advisor
  • Robo-advisor will constantly re-assess your investments to put you in the best position for big returns
  • Easy to get started
  • Many robo-investors don’t require a huge minimum investment, generally around $500
  • Many robo-advisor services come with actual human advisors as a bonus.


  • Some may not be comfortable letting a computer handle their investments
  • Low chance of massive earnings in the short-term.

How to Get Started

NerdWallet recently published a great list of the best robo-advisors, which will offer you a great database from which you can start researching.

For the super beginners and people on a budget, Acorns is a great option. They round up all of your credit or debit purchases to the nearest dollar and use a robo-advisor to invest it.

When gathering info, look for robo-advisors that offer additional perks—plus low fees for use of their services. Anywhere in the range of 0% to 0.25% per year is a respectable fee. You also want to stay away from robo-advisors that require minimum deposits.

As far as extra services you want to look out for, consider robo-advisors that offer automatic rebalancing, roboust mobile applications, and the option to invest in IRAs.

Once you’ve done some research and selected the right robo-advisor for your needs, you can get well on your way to using the power of technology to do your investing for you.


The perfect way to investing your money without deep knowledge or experience is by using a robo-advisor. It is a great way to build income over time that can help secure your financial future and build your investment portfolio.