Clients in the USA can often benefit from a range of new customer deals.
Trading brokers typically offer specific deals for new customers as a way of remaining competitive and convincing potential clients to choose them over their rivals, as found in our Wealthsimple review. New customer deals are a useful incentive for would-be customers, and a tool that many brokers use in order to convince new clients to become members.
Wealthfront offers many new customers free management on their first $5,000 when they become a member through certain websites. When researching our Wealthfront review USA, we found that the deals were vast and easy to find online.
To qualify for the promotion, you need to deposit a minimum of $500 into a new Wealthfront open account, which takes less than five minutes. It’s also worth noting that you’re able to transfer funds from existing 401(k) or IRA accounts if you would prefer to do that rather than depositing cash.
Next, our Wealthfront review USA delves into the usability, design and performance of the website.
According to our Wealthfront review, the website is easy to use and each important section is accessible through the homepage. Users can use the menu bar at the top of the site to find the relevant information for their needs – whether it be financial planning, investing, saving, borrowing or learning.
The Wealthfront open account can be found by simply pressing the bold ‘Get Started’ tab, which stands out amidst the unique and bold design of the website. Our Wealthfront opinions are that its design is modern and artistic, demonstrating its position as one of the most forward-thinking trading brokers on the market. The colors are bright and refreshing, without being overly complex. It’s always good to try other platforms to see what works for you however. If simplicity is for you, we’d suggest a look at our Stash review and SoFi Invest review for a comparison.
In terms of the logistics, our Wealthfront USA review found that the website performs immaculately, so you should have a hassle-free experience as a customer. As a proud robo-investor, high-quality technology is a priority of theirs and this is reflected in the fluidity and ease-of-use of the website.
Our Wealthfront review found that there are many different accounts on offer, including retirement investment products (Traditional IRA, Roth IRA, SEP IRA, 401(k) Rollover), education investment products (529 College Savings) and general investment accounts (Individual, Joint, and Trust). There are, inevitably, pros and cons to each Wealthfront open account, with which one you opt for depending on your preferences and your investing goals.
Handily, our Wealthfront review discovered that there are no account-opening fees, withdrawal or account-closing fees, trading fees or transfer fees when you have a Wealthfront open account. There is, however, an annual advisory fee of 0.25% on all assets under management, which is deducted from your portfolio on a monthly basis.
There is also an exclusive scheme known as Passive Plus, which includes technology-driven strategies and provides members with a range of benefits, including:
- Tax-loss harvesting
- Increased risk-adjusted returns
- Smart Beta (weighting securities in US stock index intelligently)
Some benefits are exclusive to those with more than $100k or $500k invested, while others (including tax-loss harvesting) are available to all investors. Wealthfront claims that you would incur potential trading fees of up to $6,321 if you were to try and replicate this yourself using other trading brokers.
Our Wealthfront review noticed that the broker had many different account options to suit those with varying amounts to invest. The accounts are diverse and low-cost, and it seems that Wealthfront are targeting younger people and millennials in particular.
Crypto and Forex investments are not what Wealthfront specializes in, so if you are interested in these, you may want to consider reading into competitors such as our ATC Brokers review and our analysis of Citifx Pro.
Whether you’re looking to save for college, buying a home, or building yourself a retirement pot, Wealthfront has a variety of investment accounts to suit your financial goal. Here, our Wealthfront review takes a look at the retirement investment accounts available, including its Traditional IRA, Roth IRA, SEP-IRA, and 401(k). Our Wealthfront opinions are that the robo-advisor specializes in this specific type of savings or investment account, and they are particularly useful for those looking to build a tax-efficient retirement fund.
The Traditional Individual Retirement Account (IRA) is an investment option that allows account-holders to contribute pre-tax dollars in an account where investments increase tax-deferred until withdrawal (when you retire). When you eventually withdraw or retire, the money that you withdraw is taxed at your current income tax rate.
The maximum contribution amount for this Traditional IRA is $5,500 per year for those under 50, and slightly higher at $6,500 for those 50 and older. It’s also worth noting that there is a 10% penalty if you choose to withdraw early, so you should only put away what you know you can afford as you will not be able to access it until you retire (unless you are happy to be charged the 10% withdrawal fee).
As always, read the terms and conditions of any account that you choose before committing to it, and make sure that you understand the possible fees and charges involved.
Roth IRAs are great ways to put money away for your retirement, and like the Traditional IRA, it allows your investments to grow tax-free. But, unlike the Traditional IRA, you are able to make tax-free withdrawals of contributions from your Roth IRA at any time without fees. After a five-year holding period, you may also be able to make tax-free withdrawals of earnings on your contributions.
There are certain requirements to qualify for a Roth IRA, including that you must have an ‘earned income’. This essentially means that you must either work for someone else who pays you or have your own business or farm to earn eligible income.
The most important thing to remember about a Roth IRA is that contributions are taxed up front. Annual contributions are capped at $6,000 for investors under the age of 50 and $7,000 for people 50 and above. Our Wealthfront USA review found that you are able to withdraw contributions at any time without being penalized or taxed, and qualified distribution of earnings are not taxed.
This type of account is officially known as a Simplified Employee Pension Individual Retirement Account, but it is thankfully referred to as the acronym SEP IRA. SEP IRAs are similar to the aforementioned Traditional IRAs, but they are specifically for small business owners and self-employed people.
One of the most important benefits of the Wealthfront SEP IRAs is the high contribution limit. Our Wealthfront review notes that you are able to contribute up to 25% of your income, or $57,000, depending on which is the lower amount. This contribution limit may vary from year to year, so remember to check this (and the rest of the terms and conditions) before investing your money. Similarly to a Traditional IRA, contributions made to Wealthfront SEP IRAs are tax-deductible and the money within your account is not taxable until it is withdrawn.
Who should get a SEP IRA? Well, it depends on your needs and preferences, but SEP IRAs can be highly useful accounts for self-employed individuals who have no employees (or very few) and want a flexible way of saving for retirement.
You are also able to do a 401(k) rollover through a Wealthfront open account. In short, a 401(k) is a popular retirement savings plan that is sponsored by your employer. It allows you to save and invest a portion of your income before taxes, and is highly useful as you won’t need to pay tax on your money until it is withdrawn (when you retire).
When you invest in a 401(k), your employer or former employer is able to choose the administrator and determines which investment options that you have access to. A 401(k) rollover – which is available through Wealthfront – is the process of transferring the money in your retirement account to a new IRA or a new 401(k) plan. When you rollover your 401(k) with Wealthfront, your funds are reinvested in an IRA account which means that you then get more control over your investments and the cash inside your retirement fund.
Please note that our Wealthfront review USA found that the company does not currently support inherited or beneficiary IRAs.
It’s also worth noting that there is an investment for an education account known as the 529 College Saving account if that is your goal.
Our Wealthfront review supports claims that the website is one of the best robo advisors on the market, providing passive investing ‘on autopilot’, without much effort from customers. The platform is high-quality and modern, building you a diverse portfolio and automatically maintaining an appropriate investment mix over time.
Similarly to many other robo-investing websites, Wealthfront makes use of Modern Portfolio Theory (MPT) to set up an automated investment allocation, which assesses the level of risk you are willing to take and your financial goals in order to give you the best experience.
Our Wealthfront opinions conclude that the software used is impressive, similar to that found in our ZacksTrade review, and is far more state-of-the-art than other more simple brokers. The software and platform is largely automated, allocating your investments dynamically with automatic rebalancing.
In order to help you reach your goals, Wealthfront also uses an algorithm known as Path, providing customers with free financial planning relating to retirement, college and/or the purchase of a property.
Wealthfront USA offers a high-tech mobile app where you are able to view your finances, plan your savings and make investments, and you also have access to automated advice. The app is highly rated with existing customers, with an average rating of 4.9 out of 5 on the Apple App Store. Our Wealthfront review USA noticed that the website itself urges customers to start by downloading the free app before opening a cash or investing account.
The high-quality of its app-only reinforces our Wealthfront opinions that it is one of the most forward-thinking and progressive brokers on the market, which suits the millennials that it is targeting.
Please note that the app is only offered to American customers at the time of writing.
This Wealthfront review USA will now take a look at the payments, fees and charges that are applied when you get a Wealthfront open account.
There is an annual advisory fee of 0.25% on all assets under management, which is calculated appropriately and deducted monthly. You will be glad to discover that there are no fees to open an account, withdraw, close your account, or transfer, and every account is commission-free. This is impressive and only strengthened our Wealthfront opinions, as there are not many trading brokers on the market that offer such low-cost accounts.
A minimum of $500 must be deposited to open an account, but this is relatively low in comparison to most brokers. Your $500 gives you access to a diversified portfolio filled with low-cost index funds, as well as daily tax-loss harvesting services.
It’s also worth keeping in mind that those with investments elsewhere do not need to sell them in order to make the transfer, as Wealthfront USA provides a free, simple, and tax-efficient service to transfer investments from other providers.
Our Wealthfront USA review recommends that you read the terms and conditions of your account before signing on the dotted line, as these things can change from time to time.
Wealthfront is known as a robo-advisor, but it also provides a helpful customer service if you ever need some help or assistance with anything relating to your Wealthfront open account.
There is an extensive page dedicated to answering the frequently asked questions of customers, where you can either search for a specific issue or browse through the various categories or topics.
Those with a Wealthfront open account can log in to their account to contact a member of the Wealthfront team if they would like to dispute a transaction, replace a card, or for any other specific issues that cannot be resolved using the support or FAQs page. The support is on offer directly from the provider and it is, of course, available in English.
The personal customer service advice is exclusively available to customers, which is only available to those in the USA.
Our Wealthfront review USA rates the broker as a legitimate and safe online investment broker. It is registered with the Securities and Exchange Commission (SEC), which is a governing body that regulates the securities industry and ensures that investment companies adhere to the relevant rules and that they are convicted of fraud if ever they step out of line.
Wealthfront is a member of the Financial Industry Regulatory Agency (FINRA), which is a private corporation that acts as a self-regulatory organization for the industry, making sure that companies and brokers remain fair and honest in everything that they do.
With a Wealthfront open account, you are protected through the Securities Investor Protection Corporation (SIPC), a federally mandated, not-for-profit corporation that was set up under the Securities Investor Protection act 1970. This essentially means that individual security accounts are insured up to $500,000, and up to $250,000 in cash. It’s worth noting, however, that the SIPC insurance is only activated if the investment company goes bankrupt.
For those with cash accounts, our Wealthfront USA review should note that the company is covered by the Federal Deposit Insurance Corporation Agency (FDIC) insurance for amounts up to $1million.
It’s important to note that these regulatory bodies and directives only apply to those investing inside the USA.
Our positive Wealthfront opinions were reinforced by the additional benefits offered to the customers of the robo-advisor, of which there are many.
One of these is the useful referral scheme on offer to Wealthfront customers, which means that you get an additional $5,000 managed for free when you refer someone else to get a Wealthfront open account. This incentive means that you save money by avoiding the 0.25% advisory fee that would otherwise be applied.
There are also various different tax-saving services and strategies available for customers, including the free stock level tax-loss harvesting on offer for taxable accounts worth $100,000 or more, making investing more tax-efficient and affordable.
Wealthfront open account customers get access to the helpful external account support, which is available for free, and the app allows you to organize all of your accounts in one place.
Our Wealthfront review USA also found that one of the other additional benefits of being a customer was the straightforward way of transferring funds from other accounts. Most brokers will require you to sell all of your holdings before switching from an advisor or brokerage account to a new robo-advisor. Fortunately, Wealthfront automatically transfers your assets into a portfolio over time rather than making you sell your holdings, reducing your tax bill and making the whole experience a more comfortable one.