Why Trust Us
Investopedia aims to provide unbiased, comprehensive reviews to help readers make the best decisions with their money. To create this list, Investopedia collected 2420 data points from 20 robo-advisor companies, focusing on the factors that are most important to investors. We reviewed each robo-advisor platform for fees, portfolio management services, goal-planning tools, and other key features in order to give each a rating. Investopedia has been helping readers find the best tools and platforms for managing their finances since 1999.
How Do Robo-Advisors Work?
Robo-Advisors provide automated investment planning based on specific algorithms. They simplify the management of an investor's portfolio based on the type of account you have and your investment goals. One of the first things you'll do when establishing an account is provide answers to key questions about your financial goals. Depending on which robo-advisor you choose, options for investing include stocks, bonds, and more.
Most robo-advisors use a passive investing approach, which can involve basing one's portfolio on an index such as the S&P 500 in order to match the performance of the index. More active approaches and more customization sometimes are possible, but those services typically will cost more.
Who Are Robo-Advisors Best For?
Those who don't have the time or the confidence to take a close, hands-on approach with their investment portfolios might be a good match for a robo-advisor. Because such a service is automated, one of the benefits is the amount of time it can save account holders. Robo-advisors also might be a good option for those who are new to investing because they provide a way to get started in investing while still learning the best approach.
Robo-advisors can also be a good fit for those who want the convenience of 24/7 access to their accounts. Working with a traditional financial planner does not provide this kind of access.
Common Robo-Advisor Terms to Understand
If you are considering using a robo-advisor for your investing needs, it's a good idea to familiarize yourself with these terms:
- Modern portfolio theory: Robo-advisors often use an approach based on modern portfolio theory, which is an approach designed to maximize returns within an acceptable level of risk. A key to this is a diversified portfolio.
- Diversification: Having a diversified portfolio involves spreading out your investment dollars among a broad range of stocks, bonds, and other assets. This is in contrast to having a large percentage of your investments committed to a single security.
- Asset allocation: One way to describe asset allocation would be that it is how an investor chooses to diversify assets, including equities, cash, and fixed income. The best approach to asset allocation depends on your needs and goals. Someone saving for the short-term would take a different approach than someone saving for the long term.
- Retirement planning: Determining your approach to retirement planning involves knowing how much income you think you'll need in retirement, then creating and following a plan to get there. Some robo-advisors can help specifically with this common type of investment planning.
- Index investing: Robo-advisors commonly use index investing as a passive approach. This involves trying to create an investment portfolio that closely follows a specific market index.
Pros & Cons of Robo-Advisors
Pros
Ease of use
Lower costs
Investment models
Cons
Impersonal
Limited flexibility
Pros Explained
- Ease of use: One of the main draws of robo-advisors is that they are easy to use. It can be as simple as creating an account and answering questions about your investment goals. This ease of use also includes 24/7 access, which avoids having to fit someone else's schedule.
- Lower costs: Because robo-advisors take a passive approach, their costs typically are lower than those of working with a personal advisor or trying to actively manage your own investments.
- Investment models: Robo-advisors offer choices of many investment models to follow. For example, if you want to focus on investing in environmentally conscious companies, there are robo-advisors that can handle that.
Cons Explained
- Impersonal: An automated process built on algorithms is definitely easy to use, but for times when you might want specific advice or a certain kind of feedback, it's difficult to get exactly that with robo-advisors.
- Limited flexibility: While there are a lot of investment models to choose from, customization is limited or nonexistent depending on the robo-advisor.
How We Picked the Best Robo-Advisors
Providing readers with unbiased, comprehensive reviews of digital wealth management companies, more commonly known as robo-advisors, is a top priority of Investopedia. We combined our industry research and subject matter expertise to guide the research and weightings for our 2025 robo-advisor rankings. To collect the data, our researchers gathered data points through online research of provider websites. To fill in any gaps, our research team reached out to the individual companies. In some instances, our researchers did much deeper online research to get the information they needed to complete the data collection. The data collection process spanned from April 5, 2025 to April 11, 2025.
We then developed a quantitative model that scored each company to rate its performance across nine major categories and 60 weighted criteria to find the best robo-advisors. The score for each company’s overall star rating is a weighted average of the criteria:
- Goal Planning - 21.00%
- Portfolio Contents - 17.00%
- Portfolio Management - 17.00%
- Fees - 15.00%
- Account Services - 10.00%
- Account Setup - 5.00%
- Customer Service - 5.00%
- Security & Education - 5.00%
- User Experience - 5.00%
Through this all-encompassing data collection and review process, Investopedia has provided you with an unbiased and thorough review of the top robo-advisors.
The above material and content should not be considered to be a recommendation. Investing in digital assets is highly speculative and volatile, and only suitable for investors who are able to bear the risk of potential loss and experience sharp drawdowns. Digital assets are not legal tender and are not backed by the U.S. government. Digital assets are not subject to FDIC insurance or SIPC protections.
People Inc. receives cash compensation from Wealthfront Advisers LLC (“Wealthfront Advisers”) for each new client that applies for a Wealthfront Automated Investing Account through our links. This creates an incentive that results in a material conflict of interest. People Inc. is not a Wealthfront Advisers client, and this is a paid endorsement. More information is available via our links to Wealthfront Advisers.
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
Automated investing is offered through SoFi Wealth LLC, an SEC-registered investment adviser. 0.25% fee is based on your account value. The wrap program fee may cost more or less than purchasing brokerage, custodial, and recordkeeping services separately. 0.25% fee is based on your account value. The wrap program fee may cost more or less than purchasing brokerage, custodial, and recordkeeping services separately. Brokerage costs are billed separately. Please see SoFi.com/legal/wrapbrochure for more information. Advisory services are offered by SoFi Wealth LLC, an SEC-registered investment adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov.