Planning & Advice

5 Reasons to Switch to a Robo-Adviser

July 17, 2019

5 Reasons to Switch to a Robo-Adviser

Planning & Advice

If the term robo-adviser conjures up images of C-3PO controlling your money, relax: we’re not robots. So, why are Canadians making the switch to a robo-adviser? We leverage technology to create a modern online experience for the benefit of our clients.

“Robo-adviser” is a recent term, used to describe a variety of new and innovative online financial institutions. These firms offer lower-cost investment management and advice but being online doesn’t mean humans aren’t involved, or that you can’t talk to one. For example, at WealthBar clients receive personalized financial advice from a real financial adviser.

This includes tax-optimization, retirement planning, insurance and more. The term “robo-adviser” may be a bit of a misnomer but it does capture how these firms leverage technology to create a leaner, more efficient business, while also improving the client’s experience. This allows firms like WealthBar to advise clients online and at a distance, without the need for fancy offices and inconvenient face-to-face meetings. Investing with a robo-adviser doesn’t mean sacrificing quality, service or trust, it means more convenience, faster service and, most importantly, lower costs.

Much like online banking, “robo-advisers” represent an evolution of financial planning and investing. If you’re not sure if online advice is right for you, here are five key benefits to consider:

Lower Fees

Online advisers cost substantially less compared to traditional advisers. If you invest through a bank, you probably pay for advice through a commission embedded in the management fees on your investments. For a balanced fund, the total fees may be around 2.5%. If instead, your investments are managed by an independent adviser, you may have a fee-based arrangement with them. Fee-based advisers typically charge between 1% – 2% for advice, plus the cost of investments, which add up to 1% more. In either case – whether through a bank or a fee-based adviser – you are likely paying more than double what you would working with an online adviser. Online firms like WealthBar have management fees that range from 0.35 – 0.6% and investment MERs as low as 0.18%.

If that seems too low, don’t worry, with an online adviser you’ll actually get more than what you pay for. Online firms can charge less because they’re much more efficient. Technology automates mundane back-office processes and frees up advisers to focus on client service. This also reduces overhead costs for things like office space. Of course, your online adviser probably won’t take you out for dinner or play golf with you, but they will keep more of your money where it belongs, in your investments.


Go ahead, stay in your pajamas, have a glass of wine, spend some quality time with your cat. Your online adviser doesn’t mind. Part of the draw of online advisers is that clients don’t need to arrange to meet in person. This saves you time, is more convenient, and may alleviate some of the anxiety that comes with meeting with a financial adviser for the first time.

Low Minimums

Remember when investment advisers only wanted to talk to you if you had loads of money? Robo-advisers’ investment advice is available to everyone, regardless of income or net worth. Whether you’re making your first $5,000 TFSA investment or you’ve built up a sizeable nest-egg already, online advisers will provide advice and investment strategies that are appropriate to the stage you are at.

Better service

The online model suits the modern investor. Whether it’s via Skype, email, or even a phone call, investors get the service they want on their terms. You don’t have to juggle your schedule and make a trip just to fit in that quarterly meeting with your adviser. An innovative online experience means you can keep you up to date on how your investments are performing, get financial planning and analysis, and work with your adviser whenever you want.

Your money is safe with this robo-adviser

We often think that big, known institutions are the safest place for our money, but that is simply not true. The CIPF (Canadian Investor Protection Fund) protects investment accounts up to $1,000,000 against the insolvency of any IIROC institution and most of those big, known institutions have the same level of protection as the upstarts. Your accounts with WealthBar have the same protections as any other registered brokerage with a bank or another financial institution. You can read more about how your money is protected here.

Of course, online advice may not be right for everyone. Some clients may still want to be able to sit down in front of their adviser and they don’t mind paying for that privilege. But for many clients who, don’t meet the minimums, currently receive little or low-quality advice, and who are tired of paying high fees, robo-advisers offer a truly modern alternative.

Robo-advisers are modernizing investment advice and making it more affordable, more accessible, and more convenient for everyone. If you think a robo-adviser might be right for you, give WealthBar a try. You can start off with a free financial planning session with one of our real financial advisers.

A few minutes today could save you thousands tomorrow.
Start investing in under 5 minutes. No hold music. No paperwork.