July 14, 2015 Fact of the Day: Who are most likely to use Robo-Advisors?
DID YOU KNOW YOUNG MILLIONAIRES ARE THE MOST LIKELY TO USE ROBO-ADVISORS?
What is a robo-advisor? It’s a class of financial advisor that provides portfolio management online with minimal human intervention. The recommendations are generally based upon algorithms, and therefore, many investors – especially younger investors – feel they are more trustworthy or reliable. Some of the most well-known robo-advisor names includes firms like Betterment or Wealthfront.
Do millionaires use robo-advisors? Based on research just released by Spectrem Group, only 6 percent of Millionaires currently use robo-advisors. It’s important to note, however, that 17 percent of Millionaires under the age of 35 use a robo-advisor, compared to only 4 percent of those 55 and older. Why aren’t older investors using robo-advisors? Most investors still indicate they want a personalized experience and robo-advisors don’t feel as if you are getting a personalized experience.
Watch for the use of robo-advisors to grow. This is because major providers, such as Vanguard and Schwab, are incorporating robo-advisor services. Some of these services are actually linked to an advisor.
To learn more about Robo-Advisors click here or contact Randy Wostratzky at firstname.lastname@example.org or 224-544-5195