Welcome to the first Investment Robo-Advisor Account Report for March 2016!
If you are just tuning in, I am investing $500 into three different investment accounts to see which one grows. Why might you ask? Well, for those new to investing or those who want to start but are not sure where to begin or, you might have some money and want to grow your wealth, but aren’t sure which is best for you, I wanted to test out some great options.
I chose to investigate robo advisors versus traditional investment vehicles to which how much my money will grow in each one. For a year, I will invest $500 into a Betterment (robo advisor) account, Wealthfront (robo advisor) account, and into an index fund, Vanguard, and watch to see which one does better.
This month has been great for returns! Across the board, all three accounts brought in money. Yay! I am a buy and hold kind of gal, meaning I will keep the money invested long term. The three accounts invest in index funds which fluctuate with the market, allowing your investments to be more diverse and set up for long term growth.
Betterment did the best starting out at the beginning of this journey, topping the month at 3.9% return or a total account value of $519.90! Wealthfront was second with 2.5% return and account value of $513. Vanguard did get a slow start because it took them longer to get the funds transferred and my “buy” of VOO took multiple days to process. We will see if the traditional investment vehicle will be able to catch up in the long run. Additionally, because VOO was trading somewhere around $139/share, I could only buy 2 shares of VOO. Essentially, I am not as fully invested with the Vanguard account as I am with Betterment and Wealthfront. With the more gains in the Vanguard account, I will be able to buy a third share shortly.
Anyone can sign up for these accounts and, personally, it was very easy to set up the account with the robo advisors. I recommend investing a few dollars and see what happens!
Want to join the challenge? Feel free to add a comment below on how your accounts are doing! Here is what I did to set up each of my investment accounts:
How I Set Up My Betterment Investment Account
How I Set Up My Wealthfront Investment Account