What is a Robo-Advisor?
How It Works
| Step | Details |
|---|---|
| 1. Answer questions | Risk tolerance, goals, timeline |
| 2. Get portfolio | Assigned based on your profile |
| 3. Deposit money | One-time and/or recurring |
| 4. Automatic management | Rebalancing, dividends reinvested |
Who Should Use One
| Good For | Not Ideal For |
|---|---|
| Hands-off investors | Active traders |
| Beginners | Very large portfolios |
| Small to mid accounts | Want specific stocks |
| Busy people | Fee-sensitive DIY |
Best Robo-Advisors Compared
Quick Comparison
| Robo-Advisor | Fee | Minimum | Best For |
|---|---|---|---|
| Wealthsimple Invest | 0.50%/0.40% | $0 | Most people |
| Questwealth | 0.25% | $1,000 | Lowest fees |
| CI Direct Investing | 0.35% | $0 | SRI options |
| BMO SmartFolio | 0.70%/0.40% | $1,000 | BMO customers |
| RBC InvestEase | 0.50% | $100 | RBC customers |
Wealthsimple Invest
Overview
| Feature | Details |
|---|---|
| Management fee | 0.50% (under $100K) |
| 0.40% ($100K+) | |
| Minimum | $0 |
| Accounts | TFSA, RRSP, FHSA, RESP, Non-reg |
| App rating | ★★★★★ |
Features
| Feature | Included |
|---|---|
| Automatic rebalancing | Yes |
| Tax-loss harvesting | Yes (at higher tiers) |
| Dividend reinvesting | Yes |
| Round-ups | Yes |
| SRI portfolio | Yes |
Pros & Cons
| Pros | Cons |
|---|---|
| No minimum | Higher fee than Questwealth |
| Best mobile app | 0.50% adds up on large accounts |
| Many features | |
| SRI options |
Best for: Beginners, anyone wanting best user experience.
Questwealth Portfolios
Overview
| Feature | Details |
|---|---|
| Management fee | 0.25% |
| Minimum | $1,000 |
| Accounts | TFSA, RRSP, RESP, Non-reg |
| Parent company | Questrade |
Features
| Feature | Included |
|---|---|
| Automatic rebalancing | Yes |
| Tax-loss harvesting | No |
| Dividend reinvesting | Yes |
| Portfolios | 5 risk levels |
| SRI portfolio | Yes |
Pros & Cons
| Pros | Cons |
|---|---|
| Lowest fee | $1,000 minimum |
| Good portfolios | App not as polished |
| Questrade ecosystem | Fewer features |
Best for: Fee-conscious investors with $1,000+.
CI Direct Investing
Overview
| Feature | Details |
|---|---|
| Management fee | 0.35%-0.60% |
| Minimum | $0 |
| Accounts | TFSA, RRSP, RESP, Non-reg |
| Formerly | WealthBar |
Features
| Feature | Included |
|---|---|
| Automatic rebalancing | Yes |
| Human advisors | Yes |
| Tax-loss harvesting | Yes |
| Financial planning | Yes |
Best for: Want some human advice with robo convenience.
BMO SmartFolio
Overview
| Feature | Details |
|---|---|
| Management fee | 0.70% (under $100K) |
| 0.40% ($100K+) | |
| Minimum | $1,000 |
| Accounts | TFSA, RRSP, RESP, Non-reg |
Pros & Cons
| Pros | Cons |
|---|---|
| BMO integration | Higher fees |
| Big bank backing | Less competitive |
| Easy for BMO customers |
Best for: BMO customers wanting to stay with BMO.
RBC InvestEase
Overview
| Feature | Details |
|---|---|
| Management fee | 0.50% |
| Minimum | $100 |
| Accounts | TFSA, RRSP, Non-reg |
| Uses | iShares ETFs |
Best for: RBC customers, low $100 minimum.
Fee Comparison Deep Dive
All-In Cost (Management + ETF Fees)
| Robo-Advisor | Mgmt Fee | ETF Fee | Total |
|---|---|---|---|
| Questwealth | 0.25% | ~0.20% | ~0.45% |
| CI Direct | 0.35% | ~0.20% | ~0.55% |
| Wealthsimple | 0.50% | ~0.20% | ~0.70% |
| BMO SmartFolio | 0.70% | ~0.20% | ~0.90% |
Impact on $100,000 Over 20 Years
| Total Fee | Ending Balance |
|---|---|
| 0.45% | ~$318,000 |
| 0.55% | ~$310,000 |
| 0.70% | ~$297,000 |
| 0.90% | ~$280,000 |
At 7% return before fees
Robo-Advisor vs DIY
Cost Comparison
| Approach | Annual Cost on $50K |
|---|---|
| DIY (ETFs) | ~$100 (0.20% MER) |
| Questwealth | ~$225 (0.45% total) |
| Wealthsimple | ~$350 (0.70% total) |
| Financial advisor | ~$1,000+ (2%+) |
When Robo Makes Sense
| Choose Robo If | Choose DIY If |
|---|---|
| Want hands-off | Willing to learn |
| Value convenience | Want lowest fees |
| New to investing | Larger portfolio |
| Busy lifestyle | Enjoy managing |
Portfolio Types
Standard Portfolios
| Risk Level | Stocks | Bonds |
|---|---|---|
| Conservative | 20-40% | 60-80% |
| Balanced | 50-60% | 40-50% |
| Growth | 70-80% | 20-30% |
| Aggressive | 90-100% | 0-10% |
Socially Responsible (SRI)
| Provider | SRI Option |
|---|---|
| Wealthsimple | Yes |
| Questwealth | Yes |
| CI Direct | Yes |
Getting Started
Typical Process
| Step | Time |
|---|---|
| Sign up online | 10 minutes |
| Answer risk questionnaire | 5 minutes |
| Verify identity | 1-3 days |
| Fund account | Instant or 1-2 days |
| Portfolio invested | Immediately |
What You’ll Need
| Requirement | Details |
|---|---|
| SIN | Required |
| Bank account | For funding |
| ID | Government-issued |
| Risk tolerance | Determine via questionnaire |
Account Types Available
Comparison
| Account | WS Invest | Questwealth | CI Direct |
|---|---|---|---|
| TFSA | ✓ | ✓ | ✓ |
| RRSP | ✓ | ✓ | ✓ |
| FHSA | ✓ | ✓ | ✓ |
| RESP | ✓ | ✓ | ✓ |
| Non-registered | ✓ | ✓ | ✓ |
| Corporate | ✓ |
Switching Robo-Advisors
How to Transfer
| Step | Action |
|---|---|
| 1 | Open new robo account |
| 2 | Request transfer |
| 3 | New robo handles paperwork |
| 4 | Wait 2-4 weeks |
| 5 | Old account closed |
Transfer Fees
| From | Fee |
|---|---|
| Most robo-advisors | $50-150 |
| Many will reimburse | If transferring to them |
Our Recommendations
By Situation
| Your Situation | Best Choice |
|---|---|
| Beginner, any amount | Wealthsimple Invest |
| Want lowest fees | Questwealth |
| Want some human advice | CI Direct |
| BMO customer | BMO SmartFolio |
| RBC customer | RBC InvestEase |
| Large portfolio ($200K+) | Consider DIY |