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Investing

Fidelity Go Review 2019

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Fidelity Go is the robo-advisor arm of Boston-based Fidelity Investments. The program’s claim to fame is a completely transparent pricing model. When you invest with Fidelity Go, you will pay a 0.35% all-in annual fee on your assets under management for both taxable and tax-advantaged accounts. That fee covers your advisory costs as well as (nearly all) investment expenses. Invested money is put into index funds (primarily those owned by Fidelity) to create portfolios that investment managers monitor and rebalance.

The target market for Fidelity Go is the young investor, which means there are relatively few account options available, but everything is set up for easy mobile use. There is no minimum amount for opening an account, and the minimum required to begin investing is only $10. Current Fidelity customers can easily integrate Fidelity Go with their existing accounts.

Fidelity Go
Visit FidelitySecuredon Fidelity Go’s secure site
The bottom line: Fidelity Go provides a no-surprises pricing model for low-cost investing, user-friendly experience and the assurance of human oversight and rebalancing.

  • A pricing model that aims to let you know upfront exactly how much you will pay each year, so there are no surprise investment expenses
  • Low-cost index funds that allow for passive investing over time
  • Seamless integration of both mobile technology and Fidelity accounts for a user-friendly platform.

Who should consider Fidelity Go?

Fidelity Go is marketed toward young adults or other new investors who want to take a hands-off approach to their investing. The low price-point required for investing (you only need $10 in your account), the very user-friendly online and mobile interface, and the low investing costs make this a good choice for someone early in their investing journey.

Fidelity Go fees and features

Amount minimum to open account
  • $0
Management fees
  • 0.35%
Account fees (annual, transfer, inactivity)
  • $0 annual fee
  • $0 full account transfer fee
  • $0 partial account transfer fee
  • $0 inactivity fee, but your account balance must be above $10 to be invested
Account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Rollover IRA
Portfolio
  • 13 asset classes in the Fidelity Flex Mutual Funds
Automatic rebalancing
Tax loss harvesting
Offers fractional shares
Ease of use
Mobile appiOS, Android, Fire OS
Customer supportPhone, 24/7 live support, Chat, Email, 196 branch locations

Strengths of Fidelity Go

  • Cost transparency: Although the 0.35% annual fee looks higher than that of Fidelity Go’s competitors, this price covers (nearly) all potential fees. The one possible exception is some expenses associated with a particular fund in a short-term portion of an investor’s holdings. However, such expenses may be offset by a variable fee credit, and Fidelity Go goes is always transparent in letting investors know about these possible expenses.
  • Low barrier to entry: With a $0 minimum to open an account and a $10 minimum to begin investing, Fidelity Go makes it easy for even the most cash-strapped individual to start investing for their future.
  • Robo-management plus human management: Investors with Fidelity Go get the best of both types of management. Their computer algorithms—using the investor’s responses to an introductory questionnaire—match investors with the most appropriate portfolio for their financial situation, goals, timeline, and risk tolerance. Human investment managers keep an eye on these portfolios to handle any day-to-day trading and investment decisions, as well as rebalancing when portfolios fall out of balance.
  • Ease of use: Fidelity Go’s user interface really shines, with an intuitive set-up and easy-to-use tools. Investors can also get their questions answered 24/7 via the interactive chat-bot, although difficult questions may confuse the system. (A question about tax-loss harvesting, which Fidelity Go does not offer, caused the chat-bot to invite me to call the customer support number). Current Fidelity customers will experience a seamless integration, making Fidelity Go an obvious choice for anyone who already holds an account with Fidelity.

Drawbacks of Fidelity Go

  • Limited account types available: Fidelity Go only has a few account types for investors. These include individual and Joint taxable accounts, traditional, Roth, and Rollover IRAs.
  • No tax-loss harvesting: Unlike other robo-advisors, Fidelity Go does not offer tax-loss harvesting, nor does it provide an alternate tax minimization strategy for investors. However, it does use municipal bond funds in taxable accounts to help investors reduce their tax burden.

Is Fidelity Go safe?

As a part of the Fidelity family, Fidelity Go offers a secure experience for any investor. In addition to their two-factor authentication every time you log in to your account, they use encryption, security questions and answers, and have strong username and password requirements. Fidelity Go also invites customers to download an application for extra security for your log in.

Although Fidelity Go doesn’t have its own review page with the Better Business Bureau, Fidelity Investments is not accredited and currently carries a C- rating. As with investments through other investment firms, all investments carry some form of risk as there’s no guarantee for a return on your funds.

Final thoughts

For current Fidelity customers and young adults without much money to invest, Fidelity Go is a great robo-advisor option. The integration with other Fidelity accounts means that current customers can easily access the benefits of Fidelity Go, including transparent and low fees, day-to-day management by human investment professionals, automatic rebalancing, and easy-to-use technology. Those without a great deal of money to invest can enjoy all of those upsides while getting started with as little as $10. This can help new investors get started with investing without asking for a big minimum account deposit.

However, Fidelity Go is not the right choice for everyone. Investors who want access to accounts other than IRAs and taxable accounts will need to look elsewhere. Also, the lack of tax-loss harvesting can make taxable investing too expensive for some investors. Both Wealthfront and Betterment can offer investors more account choices and tax-loss harvesting.

Finally, Fidelity Go is not right for investors who want to have a more hands-on approach to their investments, as all day-to-day investment decisions are made by Fidelity’s team of investment managers. Hands-on investors may be happier with Fidelity’s self-directed brokerage, or with a competitor brokerage such as Ally Invest or TD Ameritrade.

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Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Guy Birken
Emily Guy Birken |

Emily Guy Birken is a writer at MagnifyMoney. You can email Emily here

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Investing

Vanguard Review 2019

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Vanguard has made its reputation by lowering the cost of investing. The company touts the fact that the average expense ratio for its Mutual funds and ETFs is 82% less than the industry average. This means more earnings for investors, which is especially good for long-term investors who have decades to let their money grow. Whether you are investing for retirement or long-term wealth accumulation, Vanguard offers one of the lowest-cost and time-tested methods for consistently growing with the market.

However, since the investment philosophy that guides Vanguard’s business is to minimize the cost of investing and maintain long-term discipline, active traders may find that Vanguard is not right for them. You will not find trading tools or platforms on Vanguard, and the commission schedule is onerous for most investors who make more than 25 trades per year. In addition, if you need more hands-on advice, you must have $50,000 invested to make use of their financial advisor service.

Vanguard
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The bottom line: Vanguard provides excellent value to passive investors who are happy to allow their money to grow with the market, but the brokerage is not set up logistically or financially for very active traders, nor does it provide financial advising for low-volume investors.

  • Low investment fees preserve investment gains.
  • Passive investment in index funds is encouraged.
  • Active trading is difficult and expensive on this platform.

Who should consider Vanguard

Vanguard really shines as a brokerage for investors building retirement portfolios. It encourages investors to choose from a number of investment options that mitigate potential risk, such as index funds. These funds are set up to track the performance of a specific market index, such as the S&P 500. Such funds do not need an active manager, which keeps the fees low, and the investor can expect to do about as well as the market overall.

Anyone who is investing for retirement may be well-served by the basic strategy behind index funds, which were invented by Vanguard’s founder, Jack Bogle. A retirement investor’s funds will grow in a relatively low-risk and low-cost investment that will benefit from the long time frame that passive index fund investing requires.

Vanguard’s wide variety of accounts and investment options includes Stocks, Bonds, exchange-traded funds (ETFs), and Mutual funds. The company also has developed its own branded Mutual funds and ETFs.

Vanguard fees and features

Stock trading fees
  • $7 per trade for the first 25 trades per year, $20 per trade thereafter for accounts with less than $50,000
  • $7 per trade for accounts with $50,000 to $500,000
  • $2 per trade for accounts with $500,000 to $1M
  • $0 per trade for accounts with $1M to $5M for the first 25 trades per year, $2 per trade thereafter
  • $0 per trade for accounts with more than $5M for 100 trades per year, $2 per trade thereafter
Amount minimum to open account
  • $1,000 for Vanguard Target Retirement Funds and Vanguard STAR® Funds; $3,000 for most other Vanguard funds
Tradable securities
  • Stocks
  • ETFs
  • Mutual funds
  • Bonds
  • Options
  • Forex
  • Crypto-currency
Account fees (annual, transfer, inactivity)
  • $20 annual fee for account balances below $10,000; waived if you have at least $10,000 in Vanguard funds or ETFs or sign up for statement e-delivery
  • $0 full account transfer fee
  • $0 partial account transfer fee
Offers automated portfolio/robo-advisor
Account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • 529 Plan
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • Custodial Uniform Gifts to Minors Act (UGMA)/Uniform Transfers to Minors Act (UTMA)
  • SEP IRA
  • Solo 401(k) (for small businesses)
  • SIMPLE IRA (Savings Incentive Match Plan for Employees)
  • Trust
Ease of use
Mobile appiOS, Android, Fire OS
Customer supportPhone, Email
Research resources
  • SEC filings
  • Mutual fund reports

Strengths of Vanguard

  • Low investment fees: Though it may seem like no big deal to pay a 1% investment or management fee, this cost compounds in the same way interest does. Vanguard reported that the average expense ratio across the entire fund industry (excluding Vanguard) was 0.62% in 2017, or $62 for every $10,000 invested. Meanwhile, Vanguard’s expense ratio during that same time was 0.11%, or $11 for every $10,000 invested, which is 82% lower than the average.
  • Fund performance: Investors with Vanguard can feel confident about the firm’s track record of success, as 89% of Vanguard’s funds outperformed their peers over the 10-year period ending Sept. 30, 2018. Combine this high performance with the low fees, and Vanguard investors can reasonably expect their portfolios to do quite well over time.
  • Retirement education: Vanguard offers a great deal of high-quality and well-researched educational information and tools for investors who are preparing for retirement. With the website, you can determine the best investment options for retirement, decide how to prioritize your financial goals, predict when you can afford to retire, estimate expenses in retirement and weigh the benefits of various tax strategies.
  • Vanguard Personal Advisor Services: Investors who would like some expert guidance can partner with a financial professional using Vanguard Personal Advisor Services. The advisor will help you articulate your financial goals and develop a personalized financial and investing plan for you. Your advisor also will be available for questions or support as you move forward with your investment plan. Only investors with $50,000 or more under management may access Vanguard Personal Advisor Services, and there is a 0.30% annual fee for the service.

Drawbacks of Vanguard

  • Active Trading: Vanguard is not set up for active trading. This is in part because active traders are not Vanguard’s target clientele. However, the lack of simple trading tools or platforms and the fact that the cost per trade goes up after making a certain number of trades per year for some accounts mean Vanguard is effectively discouraging its customers from doing active trading. While this is not a problem for investors who are trying to prepare for retirement, investors who would like to have a one-stop shop for passive and active investing will have to look elsewhere.
  • Advisor services may be out of reach: Vanguard’s Personal Advisor Service requires investors to have at least $50,000 invested, which means beginning investors or those with fewer assets in their accounts may be shut out of getting personalized advice. This could be a problem, as it is the new investors who are most likely to need such personalized service to get on the right track.

Is Vanguard safe?

While every investment carries some inherent risk, you can rest assured that your money is as safe as possible invested in Vanguard funds. First, Vanguard is a member of the Securities Investor Protection Corporation (SIPC), which protects individual investor assets up to $500,000. Vanguard provides additional coverage for eligible customers through Lloyd’s of London.

In addition, Vanguard uses multiple security measures to ensure that only the customer (and no one else) has access to his or her accounts.

Final thoughts

Vanguard is an excellent choice for mid-level to high-level investors who want set-it-and-forget-it investments that will provide a stable retirement or otherwise grow wealth. But that does not mean it is the right choice for everyone.

Anyone who wants to do active trading may find Vanguard to be limiting and may be happier with a brokerage like Ally Invest or TD Ameritrade. Both of those brokerages are better set up to allow active trading and in fact encourage the practice by reducing trading fees after you have completed a certain number of trades per year. Vanguard, on the other hand, increases its trading fees after you have made a certain number of trades per year for some accounts.

In addition, younger investors with less money to work with may find that they can’t get the kind of personalized service they need to make the best choices with their money. For such investors, Betterment, with its focus on improving investor behavior and providing personal financial advice, may be a better fit.

Ultimately, Vanguard does what it does very well for its target clientele. If you are outside of that target, it may not work for you.

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7

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Guy Birken
Emily Guy Birken |

Emily Guy Birken is a writer at MagnifyMoney. You can email Emily here

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Investing

Ellevest Review 2019

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Women’s financial needs are different from those of men. Not only do women statistically live longer than men, they also tend to make less money, and are more likely to have employment (and therefore, income) gaps during their careers. Women keep 71% of their assets in cash (in other words, not invested), which means less of their money is working for them. All told, women have a longer retirement to plan for with less money available to them.

Traditional financial models often do not take these financial circumstances into account. Ellevest, a robo-advisor that launched in 2016 under the leadership of financial services veteran Sallie Krawcheck, aims to offer women workable solutions to these myriad issues. With customized investment portfolios and goal-based plans, Ellevest provides financial planning for women (and anyone else who is not served by traditional services), tailored to the investor’s individual needs.

Ellevest
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The bottom line: Ellevest offers an individualized financial planning experience that works to demystify investing while helping investors identify, plan for, and reach their goals

  • Goal-oriented and individualized planning with a wide array of ETF classes to meet various investment needs
  • Simplified rollovers to encourage consolidation of investments
  • Limited account types and no tax-loss harvesting available

Who should consider Ellevest

Though Ellevest is woman-centered, you do not have to be a woman to sign up with the robo-advisor. The program is a good fit for anyone who feels underserved or overwhelmed by traditional financial services, which may only have a limited selection of investment portfolios or may base suggestions on nothing more than a risk tolerance assessment.

Ellevest is different because it starts by examining the investor’s goals and investment timeline, and it then designs the portfolio based on that information. Investing with Ellevest does not require users to make do with a portfolio that is a bad fit or learn investment theory to build a tailored portfolio.

This makes Ellevest an excellent choice for a newbie investor or someone who feels intimidated by investing. However, the basic Ellevest program may feel a little too automated for anyone who is comfortable with making independent investment decisions.

For customers who want a little more personal control, two additional options give you access to one-on-one personalized guidance from a certified financial planner. The first, Ellevest Premium, charges annual fee of 0.50% for Ellevest Premium (minimum balance of $50,000). The second option is the Ellevest Private Wealth Management program, which allows you to work one-on-one with a dedicated financial advisor to create a personalized investment plan. The minimum investment to qualify for Private Wealth Management is a cool $1 million.

Unfortunately, independent investors without that kind of money available are stuck with the basic Ellevest program, which they may find too constricting.

Ellevest fees and features

Amount minimum to open account
  • $0 for Ellevest Digital, $50,000 for Ellevest Premium
Management fees
  • 0.25% for Ellevest Digital
  • 0.50% for Ellevest Premium (minimum balance of $50,000)
  • Custom pricing for Ellevest Private Wealth Management (minimum balance over $1,000,000)
Account fees (annual, transfer, inactivity)
  • $0 annual fee
  • $100 full account transfer fee via Folio Investments (Ellevest's custodian)
  • $5 per security partial transfer fee, minimum charge of $25
  • $0 inactivity fee
Account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Rollover IRA
  • Rollover Roth IRA
  • SEP IRA
Portfolio
  • 21 asset classes
Automatic rebalancing
Tax loss harvesting
Tax loss harvesting detailEllevest's Tax Minimization Methodology (TMM) puts tax-efficient securities into taxable accounts and less tax-efficient securities into tax-deferred retirement accounts.
Offers fractional shares
Ease of use
Mobile appiOS
Customer supportPhone, Email

Strengths of Ellevest

  • Personalized investing for women: Ellevest not only acknowledges that women’s financial needs and concerns are different than those of men, they factor those things into their portfolio construction so that women can trust that their investments take longer life, lower pay, and career gaps into account.
  • Goals-based investing: Ellevest starts by asking investors what they want to achieve with their money and then builds a portfolio to help them reach that goal. The program assigns a percentage probability of an investor reaching her goal using a particular portofolio, and Ellevest will not allow investors to go forward with any portfolio with a less than 70% probability of success. Investors can also set multiple financial goals, and not just focus on retirement.
  • No account minimum: As a genuinely beginner-friendly robo-advisor, Ellevest has no minimum requirements for Ellevest Digital.
  • 21 ETF classes: As is common among robo-advisors, Ellevest’s portfolios are made up of a mix of ETFs . However, in keeping with their commitment to designing portfolios around individual investor needs and goals, Ellevest offers 21 different ETF classes, which is more than competitors Betterment or Wealthfront offer. This allows investors to get a portfolio that truly fits.

Drawbacks of Ellevest

  • Difficult-to-use site: Though Ellevest’s site is beautifully designed, it is not user-friendly to any investor hoping to learn more rather than just sign up. Information is spread out across several pages, and it can be difficult to locate the answers to any specific questions. The site is set up to facilitate signing up for an Ellevest account and to educate new investors about financial services, rather than allow well-informed investors to locate nitty-gritty details. There is currently only an iOS app; there is no Android app and the website encourages Android users to access Ellevest via Google Chrome on their phones.
  • No tax-loss harvesting: Rather than using traditional tax-loss harvesting to help investors minimize their tax burden, Ellevest uses what they call Tax Minimization Methodology (TMM) to place more tax-efficient investments in taxable accounts, and less tax-efficient investments in tax-deferred accounts. While this can potentially help investors to reduce their taxes, it is not the same as tax-loss harvesting.
  • Limited account types available: Ellevest only offers taxable accounts,Roth IRA,Traditional IRA,SEP IRA and 401(k) rollover IRAs. There are no Solo 401(k) (for small businesses),Joint taxable account,529 Plan account, or custodial account options.

Is Ellevest safe?

Ellevest is a robo-advisor and not the broker/dealer that will hold your investments. Ellevest uses Folio, a third-party SEC-registered broker/dealer and custodian, for actual investing. Folio is a member of the Securities Investor Protection Corporation (SIPC), which protects individual investor assets for up to $500,000.

Ellevest also uses industry best practices when it comes to securing investor information, and their site uses the highest level of SSL encryption available. They have a vigorous ID verification process to make sure no one can fraudulently access your information, and use a two-step process for withdrawals and deposits.

Final thoughts

If you have ever felt shut out of traditional financial services, Ellevest can be the right option to help you become an investor. With its goals-oriented investment approach and commitment to meeting the needs of women and other individuals whose finances don’t fit the standard mold, Ellevest offers a supportive, diversified, and intelligent approach to managing money.

Any investors who already have some familiarity with the financial industry, or who would like to be more personally involved with their investment decisions could be frustrated by Ellevest, however. With a website user interface that is not designed for research, an app that is only available for Apple users, and a sparse selection of account types, Ellevest’s entry-level robo-advisor does not have as much to offer the more advanced investor. In addition, the lack of tax-loss harvesting could be a turn-off for any investor worried about capital gains taxes.

Both Wealthfront and Betterment may offer some better options to investors who still need personalized advice, but would like a more user-friendly online and mobile experience, more account options, and the ability to use tax-loss harvesting. But remember that Ellevest does offer a more personalized portfolio than either of its competitors because of the 21 ETF classes it offers.

For new investors who have been turned off by traditional financial services, Ellevest offers a much-needed service. If that does not describe you, it may not be the right fit.

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Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Guy Birken
Emily Guy Birken |

Emily Guy Birken is a writer at MagnifyMoney. You can email Emily here

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