What Are Robo Advisors?
A robo advisor is an investment management tool that uses algorithms to manage an investment strategy rather than relying on the advice of human stockbrokers. A robo advisor can help manage your investments over time and even do things like rebalance your moves when needed to ensure that you’re still following your approved investment strategy.
Since robo advisors use a computer program to do most of the work, they’re able to offer a low cost investment service since they don’t pay a human advisor. This means you can pay less and still get a high-quality investment service.
According to Goldman Sachs, robo advisors are expected to grow rapidly over the next several years. In fact, the fraction of clients who are using robo advisors to manage their money is expected to increase significantly by 2020 … which means that, if you’re looking for a safe, low-cost investment service, this might be a smart option for you.
Some people are wary of robo advisors, however, simply because they’re doing more with their investments instead of a human broker. An investment service that transfers your money to a robo advisor is a good option if you’d rather give up direct oversight of your investments, though.
How Robo Advisors Manage a Retiree's Portfolio
Robo Advisors provide a sneak peek into the future by allowing investors to take a glimpse of where their money will be used most in the years to come. People who are currently putting money in stocks are slowly transitioning to stocks that will be more relevant for their future.
There are three big ways that robo advisers are changing retirement through their management technology but let's discuss how they are going to make a direct impact.
What Are the Best Robo Advisors for Retirees?
Robo advisors are being introduced as affordable alternatives for investors looking to reduce their costs and decrease their involvement in the management of their portfolios. While the benefits of robo advisors are very alluring, retirees have a greater risk tolerance than young professionals, who are in their prime earning years.
Are you not sure if you want to use a robo advisor to manage your retirement portfolio? Or do you want to know where to find robo advisors that cater to retirees? Let’s take a closer look at these two questions.
Would You Like to Know Where You Can Find Robo Advisors for Retirees?
The best robo advisors for retirees are those that can adapt to a retiree’s appetite for risk. This means that they won’t invest your money in the most aggressive portfolio option. In fact, most robo advisors for retirees will keep a portion of your portfolio in bonds and cash. As a retiree, this will help mitigate the impact of market volatility.
The best robo advisors for retirees give you options for your allocations. You should be able to adjust them based on your age, your ability and willingness to manage your own portfolio, and your risk tolerance.
What Are the Benefits of Using a Robo Advisor for Retirees?
Is a Robo Advisor Right for Your Retirement?
Robo advisors can be very appealing to retirees. As someone who is looking to relax and live out their golden years, the idea of having more time to do what you want can be a very attractive option.
Since robos are geared towards the young and busy, we’ll look at some of the reasons behind using a robo advisor for retirees.
Since a robo advisor is going to make investment decisions for you, you won’t have to worry about keeping on top of the markets. You won’t have to do research, and you won’t have to constantly check the stock market. A robo advisor does this all for you, and most of them do it without charging for the service.
You, or your loved ones, won’t have to worry about checking account statements to see how you’re doing. The robo advisor will do that for you.
You won’t have to worry about putting a portion of your money in safe investments, and you don’t have to worry about fluctuating stock prices. A robo advisor will invest the money for you, and you won’t have to worry about looking at it as it grows over time.