Financial Advisor vs Robo Advisor

Financial Advisor vs Robo Advisor

By Kris Maksimovich:

We are asked about the differences between financial advisors and robo advisors all the time.

When it comes to answering this question, investors should do their research and understand what they are getting into.

Understanding What You Get:

Below, we offer you a breakdown of the differences between financial advisors and robo advisors.

We hope you’ll find this list helpful on your journey to investing:

Financial Advisor

  • Offers financial planning, tax planning and wealth management
  • Processes and manages emotion and behavior
  • Helps prioritize and track goals
  • Accountability and flexibility
  • Adapts to life changes and outside information
  • Sees nuances and extrapolates trends
  • Removes fear of conducting transactions online
  • Direct human contact, individual care and relationship
  • Enables measure of control
  • Investment flexibility
  • Helpful for investments that reside in 401(k)

Robo Advisor

  • One size fits all
  • Best with good understanding of investment fees
  • Automated online processes
  • Relies on artificial intelligence and algorithms
  • Lacks input and displaces advice management
  • Doesn’t offer hand-holding in bear market
  • No tax planning or succession planning
  • Lacks individualized advice and guidance
  • Risks include flaws in algorithms and lack of accountability
  • Privacy and protection concerns
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