While traditional financial advisors have historically been reserved for only the wealthiest individuals, two new types of affordable financial advisors are changing this landscape. Robo advisors and subscription-based financial advisors offer access to professional investment advice for consumers who might never experience that service otherwise.
These newer advisor models are also relatively easy to use and are ideal for investors who don’t want to manage their portfolios on their own (or have no idea how) but can’t afford the high fees associated with a traditional full-service brokerage firm.
Because a personalized experience is so important to our team at Humanity Wealth Advisors, a simple subscription is our strategy to help you get ahead.
This article will help you distinguish between subscription and robo as affordable financial planning options and which is most suitable for you.
Explore new financial advice models that are affordable and accessible.
At Humanity Wealth, our advisors have more flexibility than robo, and traditional advisors do. As an independent financial firm, we can offer more services through more than basic personalized time and attention.
What is subscription-based financial planning?
A subscription-based financial advisor is someone who provides advice to support your financial literacy on an ongoing basis versus charging a percentage of your assets. All of their efforts will be based on your financial needs. So instead of a traditional approach where you follow the lead of an advisor, you get to tell us what and when you need financial guidance.
For example, let’s say that Donald Duck has $10,000 saved in his bank account and wants to invest it in an index fund so he can earn some passive income from his savings. However, Don doesn’t have experience with investing or managing money—and even if he did, there’s no way he could afford a traditional financial advisor (who typically charges around 1% to 2% per year). Just for investment oversight alone, this would likely charge him around $100 per month ($1200/year).
Remember, locating trustworthy financial advisors without a minimum asset requirement is not easy. But what if Don was able to find affordable financial planning in the Bay Area that offers subscription-based support? Would they be willing to take on clients with less than $100k in assets?
At Humanity Wealth, we don’t care how much money you have! This sets us apart from the crowd.
The best part is that this option can help you collaborate with a financial professional before you decide to go all-in or as you start small and build wealth over time. It can be helpful for you to find out if an advisor can really deliver what they promise, right?
What is a robo advisor?
For people who don’t like to work one-on-one with someone who knows them well, robo advisors could be suitable since they use technology.
The technology behind robo advisors has been around for decades; however, it’s only recently that the software has become sophisticated enough to try to assist human financial advisors in investing decisions. While these programs are not without flaws or controversy, they offer some advantages and lower transaction fees.
What is the difference between a robo advisor and a subscription-based financial advisor?
Both models can help you invest your money to pursue your financial goals with fewer barriers to entry than the traditional one-on-one advisor relationship. Both also support people with smaller portfolios who don’t want to manage investments themselves and need a basic level of guidance.
However, robo advisors offer limited flexibility. For example, if you want to buy individual stocks or sell options on an existing portfolio, most robo advisors won’t be helpful. Many investment strategies surpass an investing algorithm.
With subscription-based advisors, there are no minimums or account size requirements, and it can cost as little as $50 per month for access to an advisor who will help you set up a tailored plan based on your needs.
Subscription-based financial advisors can conduct in-depth analyses of your finances and provide you with personalized advice based on your unique situation. They can help you identify where you need to make changes so that you can pursue your goals more quickly while reducing the risk associated with making those changes.
Subscription-based and robo advisors are options for people who want to start investing and need help. Which one is best for you depends on what your needs and preferences are.
If you’re looking for more personalized service with someone who holds themselves to a high ethical standard coupled with convenience, work with a subscription-based financial advisor at Humanity Wealth Advisors. If your needs are more straightforward, or you want to save money on management fees while still having access to some way of getting advice as needed, schedule an appointment to explore your options with us —we have a pricing plan for every budget!
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Investing in a professional financial guide via subscription could prove to be one of the best financial decisions of your life. By getting a firm grasp on your financial confidence, following a plan of action, and applying financial discipline along the way, you are building financial independence for yourself and your family.
Remember, you don’t have to be wealthy to begin.