Invest With AI: How Robo-Advisors Can Help, and 5 Recommendations for Beginners

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The world of investing is evolving, and artificial intelligence (AI) is leading the charge. Robo-advisors, powered by AI algorithms, are revolutionizing the way individuals manage their investments. They offer a low-cost, accessible, and efficient alternative to traditional investment management.

According to a survey conducted by Investopedia, “16% said they use these digital wealth management platforms to build wealth for retirement” with also “9% of respondents said they’d use a robo-advisor to build long-term wealth.” This number should only grow as the normality of robo-advisors is expected to increase to help people manage their funds and invest. If you’re debating to start on the robo-train, here’s how they can help, along with five recommendations for beginners looking to get started.

How Robo-Advisors Can Help

1. Low Cost: Robo-advisors typically charge lower fees than traditional financial advisors, making them an affordable option for beginners and those with smaller portfolios.
2. Accessibility: With an internet connection, you can access robo-advisor services from anywhere, at any time. This convenience allows for easy account management and monitoring.
3. Personalization: Robo-advisors use algorithms to create personalized investment portfolios based on your risk tolerance, financial goals, and time horizon.
4. Automatic Rebalancing: They automatically rebalance your portfolio to maintain your desired asset allocation, ensuring that your investments stay aligned with your goals.
5. Tax Efficiency: Many robo-advisors offer tax-loss harvesting, which can help reduce your tax bill by offsetting capital gains with losses in your portfolio.

5 Recommendations for Beginners

1. Betterment: One of the first and most popular robo-advisors, Betterment offers a user-friendly platform, goal-based investing, and no account minimum, making it ideal for beginners.
2. Wealthfront: Known for its advanced tax-loss harvesting and diverse investment options, Wealthfront is a great choice for those looking to minimize taxes and start with as little as $500.
3. Acorns: Acorns is perfect for those who want to start small, as it rounds up your everyday purchases to the nearest dollar and invests the spare change. It’s an effortless way to build your investment portfolio.
4. SoFi Invest®: SoFi Invest offers both active and automated investing options with no management fees, making it a flexible and cost-effective choice for new investors.
5. Ellevest: Designed with women in mind, Ellevest creates customized portfolios based on your financial goals and offers career coaching and financial planning services.

Conclusion:

Investing with AI through robo-advisors can be a smart and efficient way to manage your investments, especially for beginners. These automated platforms provide personalized, low-cost investment management that can help you achieve your financial goals. By considering the recommendations above, you can find a robo-advisor that fits your needs and start your investing journey with confidence.

Other fees, such as exchange fees, may apply. Please view SoFi’s fee disclosure to view a full listing of fees

Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA(http://www.finra.org)/SIPC(www.sipc.org).

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

Editor's note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates' editorial team.

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