Robo advisors are becoming commonplace thanks to their considerably cheaper offerings than those provided by human wealth managers. The transparent fee and no-conflict-of-interest structure is appealing to a new generation of investors (over 60% of robo advisor clients are under 35)......but the $20b currently under management is still tiny compared to the $17t managed by human advisors.
AS PROBLEMS GO, the suspicion that you are being overcharged by a private wealth manager is one of the better ones to have in life. But even millionaires who are regularly invited out to lunch by their banker tire of the 1-3% annual fee they have to cough up for his investment advice. Many mere submillionaires may well be paying similar rates for an asset-management professional to administer their pension pot, often without being aware of it. Could a computer not do an equally good job dishing out standardised guidance on how much they should invest respectively in shares, bonds and other assets?
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