Wealthsimple makes socially responsible investing simple with diverse portfolio choices, smart technology, and access to financial advisors.
What is Wealthsimple?
Wealthsimple Invest is a Robo-advisor using algorithms to recommend an investment portfolio that fits your risk tolerance, current financial situation, and time horizon. With Wealthsimple, you get help to maximize your returns, lower your taxes, and build wealth.
As part of a comprehensive investment strategy, Wealthsimple offers a suite of financial products from taxable accounts to retirement accounts to a college savings plan. The following accounts are offered:
- Personal – a taxable investment account for extra money you want to invest after maxing out your RRSP and TFSA.
- Retirement – tax-advantaged accounts for money that lets you defer and reduce your taxes for when you retire. It includes RRSP and TFSA.
- Education – RESP lets you save for a child’s education while lowering the tax burden and taking advantage of government matching.
Wealthsimple manages $10 billion assets under management and serves 1.5 million Canadians. Accounts at Wealthsimple have standard insolvency and deposit protection. Your accounts are held with our custodial broker, Canadian ShareOwner, and are protected within specified limits in the event of its insolvency by CIPF.
Wealthsimple Portfolio Options
Wealthsimple Invest offers a free portfolio review service to help you understand how your non-Wealthsimple investments perform. You’ll get an evaluation of fees, tax efficiency, and asset allocation.
The online brokerage follows Modern Portfolio Theory (MPT), an investment philosophy followed by other Robo-advisors. MPT was developed by Nobel Prize-winning economist Harry Markowitz. He demonstrated that you can minimize risk and maximize returns through diversified investments.
Wealthsimple diversifies your investments to minimize risk and maximize returns using tax-efficient funds. The Robo-advisor helps you choose a risk level you’re comfortable with to build your custom portfolio based on your financial goals. Based on risk scores, it chooses low-fee funds.
If you’re looking for value-based investing, you have choices including:
- Socially Responsible Investing Options – invest in do-good companies with social impact on the environment, climate, and more.
- Halal Portfolios – an option for Muslim investors that adheres to Islamic Halal rules (e.g. no investments in companies associated with alcohol, gambling, etc.)
After signing up, you complete a risk assessment to effectively recommend a portfolio mix. The recommendations are based on your risk tolerance, financial goals, time horizon, and investment experience.
How Does Wealthsimple Invest Work
Wealthsimple Invest takes your answers from the questionnaire along with your investment goals to recommend a portfolio of low-fee funds. It’s passive investing on autopilot.
You have options. Choose the tier of service you’d like:
The Wealthsimple Basic plan is everything you need to invest like an expert with no minimum. Get personalized portfolio and expert financial advice along with auto-rebalancing, auto deposits, and dividend reinvesting.
The Wealthsimple Black is a lower fee option with financial planning sessions. For investors with deposits of $100,000 or more. Get all the benefits of the Basic plan plus tax-loss harvesting, and tax-efficient funds.
The Wealthsimple Generation is designed for legacy and holistic financial planning. You get all the Black plan features plus in-depth financial planning, asset location, and a dedicated team of advisors offering personalized financial reports, individualized portfolios, and unlimited access to certified financial planners.
Through Wealthsimple Invest, you get:
- Automated investments into a diversified portfolio minimizing risks.
- Managing trades, dividend reinvestment, and tax efficiency for you.
- Easy access to manage your account from anywhere.
- Choose a personalized portfolio, customize your own, and align with a socially responsible portfolio or Halal portfolio.
Learn more about alternatives for American investors: Betterment (read Betterment review) and Personal Capital (read Personal Capital Wealth review).
What is the minimum investment?
The minimum deposit is $0.
Features and Benefits
Wealthsimple Invest offers you the following features:
- Auto-deposits: automate your contributions and automatic deposits.
- Dividend reinvesting: instantly put your stock dividends back to work.
- Automatic rebalancing: rebalances portfolio as the market changes so will your portfolio allocation.
- Roundup: invest your spare change and make micro-investing grow your investment account.
- Overflow: set bank balance for cash you need and automatically put the extra to work.
- Tax benefit: minimize short-term capital gains, use tax-loss harvesting to advanced stock-level tax-loss harvesting to risk parity.
- Be 18 years or older.
- Canadian resident.
The fee structure includes an annual management fee and a management expense ratio on most exchange-traded funds (ETFs).
Management fee: 0.5% per year for accounts under $100,000 and 0.4% for accounts over $100,000. The fees are calculated on a daily basis for the annual amount and charged monthly.
Investment fees: the management expense ratio (MER) are charged based on the expense ratio embedded in the ETFs in your portfolio.
Who is it best for?
Wealthsimple is best for new investors who want a robust investment platform that minimizes risks and maximizes returns. If you’re looking to automate investing and get guidance, the Robo-advisor is a great option.
Wealthsimple is a legit company and service for Canadian residents. The Wealthsimple app has a 4.2 out of 5-star rating with 692 reviews in the App Store. The majority of reviews share great customer service.
In our Wealthsimple review, the Robo-advisor shines with its all-in-one design that merges investing and wealth creation with ease. The investment management service can appeal to new and experienced investors alike. The minimum investment of $0 makes it almost too easy to start and take advantage of the many features and benefits offered.
Keep in mind that Wealthsimple does not provide financial advice with the Basic plan. You will need $100,000 or more to get personalized financial planning.
Pros and Cons
- Easy setup that takes a few minutes.
- No minimum deposit.
- Low management fees.
- Tax-efficient strategies.
- No financial advisor access for accounts under $100,000.
How to start a Wealthsimple account
The time needed: 5 minutes.
Step-by-Step to open an account
- Get started
- Create an account by visiting the website.
- Enter your information
- Provide your personal information for verification.
- Portfolio Options verification
- Share your financial goals and why you’re investing and your time horizon.