Wealthsimple is the top Canadian Robo advisor in Canada. It is our top pick due to its clear pricing, affordable costs for small accounts, outstanding value for large accounts, general usability, and special benefits.
Some of the key benefits are:
- Access to human advisors
- User-friendly and modern platform
- The ETF MERs are some of the lowest in the industry
- Automatic tax-loss harvesting for Black & Generation clients
- Broad investment selection, including Halal and SRI funds
- Extensive industry experience
- Lots of available investments to choose from
- Newly launched debit card, including caskback in cash or btc
One of the top robo advisors in the globe, Wealthsimple has branches across the Americas, Europe, and Canada. CEO Michael Katchen established the business in 2014 with the intention of “bringing smarter financial services to everyone, regardless of age or net worth.” Before founding Wealthsimple, Katchen worked at a Silicon Valley start-up where he counselled his coworkers on how to do their own investing.
Wealthsimple is well-equipped to manage your money because its corporate headquarters are in Toronto. They have a group of top-tier financial experts and the brightest technologists working for them. Their software engineers, graphic designers, and data scientists have prior experience at prestigious firms like Apple, Google, and Amazon. Wealthsimple is currently the largest robo advisor in Canada with 235 staff, more than $8.4 billion in assets under management, and 1.5 million users worldwide. In other words, they are trustworthy with your money and have a legal obligation to their clients.
Wealthsimple key features
Wealthsimple distinguishes out as the top robo advisor in Canada for a variety of great reasons. It only requires a quick glance at the remarkable qualities and services offered to their clients:
Minimum deposit – $0 for basic account
Portfolio review service – A free portfolio analysis from Wealthsimple includes an assessment of your non-Wealthsimple financial accounts. They will examine your account’s costs, tax efficiency, and portfolio allocation for any third-party accounts you may have.
Wealthsimple Debit Visa Card – 0% fee and includes cashback. It can be used anywhere that accepts visa worldwide, and it can be added to apple or google wallet
Free tax-loss harvesting – If you are investing money outside of your RRSP or TFSA, this option, which only applies to investors with taxable accounts, can be a helpful tool. By offsetting investment losses with investment gains, tax-loss harvesting reduces your taxable income from investments. The majority of robo-advisors and financial advisors provide this service to high-value clients, however Wealthsimple clients can choose to use tax loss harvesting, while Wealthsimple Black and Generation clients have it done automatically.
Access to experienced financial advisors – When it comes to financial planning, the majority of robo advisers take a backseat role. One way they keep their fees so low is by doing this. However, if you’re a client of Wealthsimple Black, you may take advantage of goal-based financial planning with a knowledgeable portfolio manager. Similar to this, clients of Wealthsimple Generation have access to comprehensive financial planning and a team of professionals that will even create a unique financial report based on your objectives. However, regardless of tier, every Wealthsimple customer has unrestricted access to human financial advisors.
Investment in fractional shares – Wealthsimple constructs your portfolio using ETFs, like the majority of robo-advisers, and determines your asset allocation depending on your risk tolerance. You can start collecting interest right away without having to wait until you have enough money to buy a complete share by investing in fractional shares since every dollar you put in (even a little deposit) is invested right away. In essence, this means that a portfolio with $10 can have the same level of diversification as one with $1 million.
Social Responsible Investments options – Their socially conscious investing option enables you to create portfolios utilizing exclusive low-free SRI ETFs that contain the most socially conscious businesses in developed countries around the world and North America, while excluding the top 25% of carbon emitters in each industry. At least three women make up 25% of the boards of directors of every company in their fund. The fact that Wealthsimple charges the same management costs for SRI and non-SRI portfolios is a major plus.
Pay your transfer fees – Wealthsimple will pay the transfer charge if you move your account there. After completing a brief survey, transfers of investment accounts worth more than $5,000 are qualified for transfer fee reimbursement. Additionally, Wealthsimple will never impose penalties on you for transferring your money out and you are never locked in.
Other out-of-the-box products – Wealthsimple offers a wide range of additional services, in contrast to standard robo advisers. For instance, Wealthsimple Trade is an online brokerage that doesn’t charge trading costs when you buy or sell stocks or ETFs. The Wealthsimple Trade app also offers Wealthsimple Crypto. Super savers will also like Wealthsimple Save, a high-interest savings account with no introductory rate and a 0.5 percent interest rate. Additionally, Wealthsimple provides Halal Investing, a brand-new investment portfolio that complies with Islamic law and is advised by professionals in both finance and religion.
Tools to assist you save money – To help you get the most out of your assets and savings, Wealthsimple employs a variety of technical strategies. To transfer money from your checking account to your Wealthsimple Invest or Cash accounts, for instance, you can use the “Overflow” option. Another cash-siphoning tool is “Roundup,” which rounds up your debit and credit card purchases and invests the extra money.
Wealthsimple excels in this area because of its low fees. They have three layers of transparent pricing:
Basic (First $99,999): 0.5%
Black (Above $100,000): 0.4%
Generation (Above $500,000): 0.4%
Approximately 0.1 to 0.2% annually
For SRIs: 0.25% to 0.4%
The ETF MERs offered by Wealthsimple are also fantastic; they range from 0.10 percent to 0.20 percent, for a total cost of 0.50 percent to 0.70 percent (depending on the funds you select) – almost the lowest in the industry. Clients pay 0.65 percent to 0.90 percent all-in due to SRI MERs of 0.20 to 0.40 percent. Additionally, you can choose from great savings account features like tax loss harvesting and financial goal planning.
For the VIP services you receive, the lower fees of 0.4% for Wealthsimple Black and Generation clients are also quite affordable. This is advantageous because of the reduced prices, availability of financial planning services, tax-saving features, and free aeroplane lounge pass. If you are investing outside of a TFSA or an RRSP, the tax-loss harvesting alone might help you save money. Who doesn’t enjoy feeling like a VIP, too?
Pros and Cons
Think over these benefits and drawbacks before using Wealthsimple:
- Extensive industry experience, with access to human advisors
- ETF MERs: 0.1%- 0.2% (nearly lowest in the industry)
- Reasonable fees (0.40% to 0.50%)
- Broader than average investment selection, including Halal and Socially Responsible Funds
- Automatic tax-loss harvesting for Wealthsimple Black & Generation clients
As previously mentioned, Wealthsimple has three pricing tiers:
- Basic (deposit up to $100,000) – 0.5% fee
- Black (deposits of $100,000 to $500,000) – 0.4% fee
- Generation ($500,000+ in deposits) – 0.4% fee with additional perks
Wealthsimple Basic Plan
The majority of investors will begin with Wealthsimple Basic. You will be utilizing Wealthsimple Basic if the amount of your account is less than $100,000. You can access the crucial elements that have helped Wealthsimple become well-known with Wealthsimple Basic, such as:
- Management fee of 0.50%
- Ability to set up a wide array of account types like RRSPs, TFSAs, RESPs, and more
- Socially responsible investing options
- Halal investing options
- High-interest savings accounts
- Unique tools to help turbo-charge your savings like Roundup and Overflow
- Three different ETF-based portfolios to suit your situation: Standard, SRI, or Halal portfolios in risk levels 1 to 10
- Auto-rebalancing, auto deposits, dividend reinvesting, and expert financial advice
Wealthsimple Black Plan
You are eligible for Wealthsimple Black if your investment goal is $100,000 or more with the company. Please take note that you can distribute your $100,000+ across all of your Wealthsimple accounts and still be eligible for Wealthsimple Black. You have access to premium services that are only available to Wealthsimple’s most valuable customers thanks to the Wealthsimple Black program. What you will receive as a Wealthsimple Black member is as follows:
- Lower management fee of 0.40% (versus 0.50% for smaller accounts)
- Tax-loss harvesting
- Tax-efficient funds
- A financial planning session with one of Wealthsimple’s expert advisors
You are eligible for Wealthsimple Generation if the total value of your family’s accounts exceeds $500,000. This level elevates your financial situation and gives you access to Wealthsimple Basic & Wealthsimple Black’s benefits:
- In-depth financial planning
- Portfolios that are tailor-made for you
- A personalized financial report that includes income planning in retirement
- A team of dedicated advisors
- 50% off a comprehensive health plan from Medcan.
The portfolios created by Wealthsimple are based on the Modern Portfolio Theory, winner of the Nobel Prize. Harry Markowitz discovered that this theory was the most effective method for long-term money management in the 1950s, which led to the theory’s rise to renown. According to the Modern Portfolio Theory, a passive investment strategy (i.e., putting together a portfolio that diversifies to reduce volatility) is a tried-and-true technique to build your money over time.
By creating portfolios that use inexpensive ETFs to monitor the overall market, Wealthsimple puts this idea into practise. By reducing the volatility of individual stocks and taking advantage of winners by buying a large number of companies at once, this method reduces the risk to your money while maximising your investment returns.
Wealthsimple has three primary portfolio options:
Conservative: With 62.5 percent of its holdings in government bonds, high-yield bonds, and short-term bonds, this portfolio is significantly skewed toward low volatility bonds. created for investors that favour consistency and a low return. Five-year annualised return for the conservative portfolio is 5.34 percent.
Balanced: Bonds and stocks are split 50/50 in this portfolio. Appropriate for investors with a low to moderate tolerance for risk. The five-year annualised return for the balanced portfolio is 6.10 percent.
Growth: With up to 80% of its assets in emerging markets, foreign stocks, Canadian stocks, US stocks, international stocks, and emerging market stocks, this portfolio is heavily skewed toward equities. Designed for a medium-to-high risk-taking investor. The five-year annualised return for the growth portfolio is 8.18 percent.
You will be required to fill out a questionnaire during signup that will help them match you with one of their three portfolios. These ETF-based portfolios each feature an asset allocation that is tailored to your risk appetite and time horizon. As a result, Wealthsimple can create a portfolio that is extremely broad without incurring the fees of frequent purchasing, selling, and rebalancing.
How does Wealthsimple compare to their competitors?
Wealthsimple surpasses the competition when fees and features are taken into account, providing clients with:
Simple sign-up procedure: no need to go to a bank branch or sign and scan excessive amounts of paperwork
No account minimums: Some robo advisers demand a minimum investment of $1,000, $5,000, or more. There is no required minimum investment with Wealthsimple.
Simple, automatic deposits: Set it once and forget it
No fees for inactive accounts; however, some robo advisers charge $25 each quarter for unfilled accounts.
Three possible portfolios: Even while three options may not be sufficient for every financial circumstance, some investors value the simplicity.
Unique to the sector: cutting-edge options for maximising your investments include Wealthsimple Trade, high-interest savings accounts, investing spare change (Overflow), and more.
Competitive pricing: When compared to other top robo advisers in the sector, Wealthsimple’s costs are very reasonable for the services they provide.
Cutting edge app: Easy to extremely intuitive to use.
Wealthsimple is our top pick for the finest robo adviser in Canada due to their reasonable prices and top-notch services. The fundamental portfolios are composed of volatility- and cost-reduced ETF portfolios. In terms of usability, the platform is simple to use, available on mobile, and offers additional information if you want to delve deeper. Wealthsimple succeeds above all by providing reasonable costs for small accounts, excellent value for large accounts with Wealthsimple Black and Generation, and some of the lowest ETF MERs in the business.