If you’re trying to figure out if Wealthsimple is the robo-advisor for you, then you’ve come to the right place.

You may be fee conscious, you may care more about socially responsible investing, or, maybe you care more about the simplicity of a robo-advisor.

I don’t know what you consider most important when it comes to a robo-advisor, which is why I wrote such an extensive Wealthsimple review.  This review is so extensive that – after you read it – it will be hard for you not to know if Wealthsimple is right for you.

Below is my extensive review about how Wealthsimple is best for Canadians and Brits, and maybe even some Americans.

Wealthsimple Review – Best for Canadians, Brits and U.S. based socially responsible investors.

This is one of the most unique reviews I’ve done because Wealthsimple is quite dependent on region.

What do I mean by that?

If you live in Canada, then Wealthsimple is probably going to be one of the top couple robo-advisors available to you (highly likely it’s the best).

If you live in the U.K., you will find that Wealthsimple is also going to be quite a great option for you.

Now, for my American readers, Wealthsimple may not be the best option unless you care about socially responsible investing (SRI). 

Why is Wealthsimple a great option for Canadians and Brits, but not Americans?

The fact is, in America, there is an overabundance of robo-advisors who have been in a fierce price competition.  Where we sit today in the states, someone with an account at a company such as Charles Schwab, can utilize a robo-advisor platform and pay a 0% fee.

This can also be seen with other in robo-advisor apps, such as M1 Finance.

Now, in Canada and the U.K., the fee structure for robo-advisors hasn’t been driven into these valleys, and, for this reason, Wealthsimple is still a very powerful option for you.

For some Americans, while the fee for Wealthsimple will be higher than other options in the United States, you may not mind due to their socially responsible investing.  I know many people individuals are happy to pay a bit extra to utilize a socially responsible investment strategy.

Read more about my article on the best robo-advisors for socially responsible investing here: The Best (and Worst) Robo-Advisors for Impact Investing and SRI

Also, Wealthsimple offers Halal investment strategies.  This may also be a reason to use Wealthsimple.

If these strategies are important to you, the 0.4% – 0.5% fee may be right for you.

Wealthsimple Fees and Features

About Wealthsimple fees and features

• Fees –
  • Wealthsimple fee for Canada – .50% management fees on less than $100,000 (CAD), 0.40% on more than $100,000 (CAD).
  • Wealthsimple fee for the U.K. – .50% management fees on less than £100,000, 0.40% on more than £100,000.
  • Wealthsimple fee for the U.S. – .50% management fees on less than $100,000 (USD), 0.40% on more than $100,000 (USD).
  • ETF fees – The management fee mentioned above is the fee charged by Wealthsimple on the underlying assets. ETFs come with their own underlying fee of approximately .10%, but this is normal for all robo-advisors and brokers.  It is rare to find a robo-advisor offering an ETF without it charging underlying fees on ETFs.
• ETFs – Like all robo-advisors, Wealthsimple utilizes ETFs to create a portfolio of low-cost investments based on your responses to questions about risk tolerance, investment time horizon, age, etc. There are three distinct portfolios Wealthsimple operates.
  • Conservative
    • Dividend Stocks
    • Foreign Stocks
    • Canadian Stocks
    • Short-Term Bonds
    • Real Estate
    • US Stocks
    • High Yield Bonds
    • Govt Bonds
  • Balanced
    • Dividend Stocks
    • Foreign Stocks
    • Emerging Markets
    • Canadian Stocks
    • Short-Term Bonds
    • Real Estate
    • US Stocks
    • High-Yield
  • Growth
    • Foreign Stocks
    • Emerging Markets
    • Canadian Stocks
    • Short-Term Bonds
    • Stocks
    • Bonds
• Investment options –investments including:
  • Stock ETFs
  • Bond ETFs
  • Real Estate ETFs
• Wealthsimple retirement options – retirement accounts available including:
  • Traditional IRA
  • Roth IRA
  • SEP IRA
• Minimum investment – $0. For Canadian clients, American clients, and U.K. clients, there is no minimum for Wealthsimple.  This is a great feature of the platform since it allows anyone to try them out.  Many investors want the ability to test a robo-avisor before allocating large sums of money and Wealthsimple makes this easy with their lack of account minimum.
• Wealthsimple Black – Offered to investors with at least $100,000 (£100,000 in the U.K.) invested. Wealthsimple Black clients enjoy a lower fee than non-Wealthsimple Black clients.  The fee for those in the black program is 0.4% as opposed to 0.5%.
• Promotional offers – Wealthsimple doesn’t offer any compensation for promoting their platform. However, they do offer a portfolio evaluation at no cost.  If you send them your portfolio, they will send you an evaluation of your investments.

Positives of Wealthsimple

• Canadian and U.K. fees – Wealthsimple must be analyzed versus its next best option in the country you live in.  In Canada and the U.K., Wealthsimple is competitive with other robo-advisors.  Compared to the U.S., Canada and the U.K. have higher fees for robo-advisory services.  Because of the higher fees for the robo-advisor industry in both Canada and the U.K., the fee charged by Wealthsimple in those countries is competitive.
• Account minimum – Many robo-advisors charge an account minimum.  Wealthsimple’s lack of an account minimum gives the company points.  For example, if you want to use the U.S. based Charles Schwab robo-advisor, Intelligent Portfolios, it comes with a $5,000 minimum account balance.  The problem is, many investors like to test robo-advisors before they add large sums.  The ability to add any sum of money to test Wealthsimple is a positive for the platform.
• Portfolio evaluation – This is an added benefit of Wealthsimple.  Within 5 minutes, you can be on the phone with a financial expert at Wealthsimple who will review your current portfolio.  They will go over everything from taxability to the fees structure and allocation of your investments.
• Socially responsible investing –  SRI is a big benefit for Weslthsimple.  There are many investors interested in principled investing and are willing to pay a few extra basis points to do so.   When it comes to socially responsible investing (SRI), many industries will not be included in your investments.  The portfolio will be based on companies operating under a more ethical business model, and this can help you feel better about the morality of your investment holdings.
• Halal investing – This is a unique aspect of Wealthsimple to include in their platform.  Wealthsimple is one of the only robo-advisors offering services for those looking to invest in line with Islamic law.  The few basis point fee is likely worth it to adhere to a principled investment strategy that is right for you.
• Simplicity – One thing Wealthsimple has going for it is its simplicity (yep…I just realized why they named it Wealth“simple”). Because it is a robo-advisor, the company leverages modern portfolio theory and your risk tolerance to allocate your money in an appropriate manner.  The platform only utilizes three portfolio strategies and the ability to invest in socially responsible portfolios and halal portfolios.  This makes it easy on the investor since there is not a large suite of options.
• Wealthsimple Black – This service allows clients to pay a bit of a lower fee. While the fee is lower, it is still a bit higher than many robo-advisors.  The best part of Black is the ability to have access to a wealth coach and VIP airline lounges.

Negatives of Wealthsimple

• United States fees – While the U.S. fees for Wealthsimple clients are the same 0.4% – 0.5% they are in Canada and the United Kingdom, there are more options for lower fee robo-advisors in the U.S.  Fees are relative to the country you live in, and the fees for Wealthsimple in America are a bit higher than other options available.  That being said, if you are looking for a niche like socially responsible or halal investing, the fees may be worth it for you.
• Portfolio options – It’s not necessarily a bad thing Wealthsimple only offers three risk categories: conservative, balanced, and growth.  However, I don’t like the inability to be fully invested in equities.  Many young investors don’t need exposure to bonds, yet the growth portfolio of Wealthsimple holds a percentage of its allocation in bonds.  If you are searching for a 100% allocation of stocks and no exposure to bonds, Wealthsimple isn’t going to be a great fit, which is unfortunate.

Wealthsimple U.S. competitor analysis

Below is a comparison of Wealthsimple vs. Betterment and Wealthsimple vs. M1 Finance.

Wealthsimple Black

Wealthsimple Black is available for investors allocating at least $100,000 into a Wealthsimple account.  Wealthsimple Black comes with a few exciting features.  One feature Wealthsimple Black has is a lower fee.  The fee for a regular account is 0.5%, while a Wealthsimple Black account is 0.4%.  It is nice to have the option for a lower fee, but the fee for Wealthsimple Black is still higher than many robo-advisors in the U.S. (it is competitive in fees for Canada and the U.K.).  The two most impressive features of the Wealthsimple Black are the access to a financial coach and VIP airline lounge access.  If you invest over $100,000 you will be given access to a money coach to help you with a plan for investing.  The money coach will help you create and attain your financial goals and it is a great service offered by Wealthsimple.  The VIP airline lounge access can be a big deal for those who travel often – this can be a huge benefit.

Socially Responsible Investing with Wealthsimple

Socially responsible investing (SRI) is a style of principled investing in businesses operating with ethics that will not be harmful to society.  SRI strategies will not invest in companies with business models revolving around products or services that can be negative for society.  Some of these may include companies profiting from the addiction of others.  Examples of this include gambling and tobacco companies.   Also, companies hurting the environment that are non-sustainable will not be included in a socially responsible portfolio.   Examples of companies an SRI portfolio wouldn’t include are oil and gas companies, while wind and solar companies would be considered “green” companies an SRI portfolio would likely hold.

Halal Investment with Wealthsimple

Halal investing is an investment style in accordance with Islamic law.  The Quran includes passages forbidding the investment in interest, and under Islamic “Shariah” law, it is forbidden to invest to gain interest (riba).  The principal of Halal investing involves being socially conscious with your investment principals, and to utilize investment companies adhering to these principals.   A company with a business model pertaining to interest and lending activities will likely not be considered a company allowable to invest in.  However, if a small portion of a company does earn interest, it may still be considered a company that is safe to invest in.  Wealthsimple takes all these factors into account and screens investments using a third-party of Shariah scholars.  This allows the company to craft a safe portfolio for those who want to invest based on the principals of Islamic law.

When is Wealthsimple good for Americans?

Wealthsimple is good for Americans who:

Want specific services.

If you are an American looking to invest through a robo-advisor in a socially responsible manner, Wealthsimple may be a great fit for you.

Because the company offers a respectable socially responsible investing platform, you may be interested to accept a 0.4% – 0.5% management fee for the service.  I know many investors willing to pay a bit more for a service that satisfies their moral beliefs.

If you are an American looking for a robo-advisor with a Halal investment platform, Wealthsimple will be a great option for you.

There are not many companies offering services in this category of investing, and Wealthsimple is one of the few.  The 0.4% – 0.5% management fee for a Wealthsimple account will likely be an acceptable source in order to meet the Halal investing principles.

Also, it is worthy to note that anyone who currently pays for VIP lounge access via a different channel may be able to recoup those costs using Wealthsimple Black.  This could end up saving a lot of money.

Wealthsimple is not good for Americans who:

Are fee conscious.

Some American investors are fee conscious; some are not.

If you are a fee conscious American investor and are searching for the lowest possible fee charged for a robo-advisor, then Wealthsimple will not be the best for you.

In the United States, there are many options when it comes to robo-advisor services.  Depending on the amount of money you have available to invest, you may be able to utilize a robo-advisor with no management fee.  Robo-advisors not charging a management fee often will make money from other means; this can include fees charged within the ETFs themselves, or the fees charged to investors for lending and buying on margin.

Companies like Charles Schwab and M1 Finance are examples of these types of non -management-fee robo-advisors.

Wealthsimple review conclusion

Wealthsimple is an elite robo-advisor for those living in Canada and the U.K.

If you are a Canadian investor or a U.K. investor, and you are looking for an automated, algorithmic-based robo-advisor, you will benefit from Wealthsimple’s straightforward platform.  The fees will be competitive with other robo-advisor options available to you, and this adds to the strength of Wealthsimple in Canada and the U.K.

Those living in the United States have access to robo-advisors with a lower fee than Wealthsimple.

That being said, the extra ethical investment features of Wealthsimple are not well matched by other robo-advisors.

For anyone looking for socially responsible investing or Halal investing options, Wealthsimple may be right for you.  Those looking for these ethical investment options will likely be fine with the Wealthsimple fee.

One main drawback of the robo-advisor does stem from its lack of ability to hold 100% in equity ETFs.  If you are an investor looking for a exposure to 100% stock ETFs, Wealthsimple won’t be for you.

If you are looking for a blend of stock and bond ETFs, the robo-advisor will fit your needs.

The Wealthsimple Black program has two great features: access to VIP airport lounges and human coaching.  This is available to anyone with $100,000 or more with Wealthsimple.

To summarize this extensive Wealthsimple review into a few concise words…Wealthsimple is great for Canadians and those living in the U.K. due to its competitiveness in fees in those markets.  It is only best for Americans who are looking for ethical investment options, because the fee is a bit higher than is available with other U.S. based robo-advisors.

If you are not sure about using Wealthsimple, they offer a FREE review of your portfolio so you test their advice.

Do you use Wealthsimple?  I’d love to hear your experience below!

Disclaimer: These are the ideas and opinions of the author.  The author is not responsible for the actions of those who read the posts on this blog.  Each individual reader has a unique situation and unique needs.  This blog is not intended to solve those unique situations of the readers.  This blog is not liable for decisions made by the readers of this blog.

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