How automated investing can grow your money while you live your best life
Most millennials probably already know they should be investing their money. After all, even the most risk-averse understand that they can see good financial returns in the long run. But the cost of living in Toronto doesn’t always leave much left over, and it can be super-intimidating to start investing on your own—especially if you’re the type of person who’d way rather go out for dinner with friends than pore over a company’s financial statements.
That said, there’s been a real shift recently about how millennials think about their fiscal future. They’re actively disproving all those tired bad-with-money stereotypes, saving more of their paycheques and thinking about home ownership and retirement. Thankfully, companies are catching on, and they’re starting to provide innovative new ways to invest your savings without all the traditional red tape and higher minimum amounts and fees. Case in point: RBC just came out with a digital investment advice service called RBC InvestEase, which delivers investment advice, personalized recommendations and portfolio management—all totally automated online and at a cost that’s much lower than most options.
Here are a few reasons why robo-advisors are a great option for busy Torontonians who want to spend their time focusing on their hobbies, not their finances.
1. They’re customized to your preferences. Contrary to popular opinion, robo-advisors don’t just offer a one-size-fits-all solution. For example, with RBC’s InvestEase service, potential investors are asked to fill out a short online questionnaire, which asks questions like why you want to invest, your investing experience, how much you plan on investing and how much risk you’re comfortable with. Then, they match you with a type of portfolio, ranging from conservative to aggressive.
2. Fees are lower than you’d think. It can be tough to see some money managers take up to two per cent of your investments every year. With RBC InvestEase, investors only pay 0.5 per cent a year in management fees. And right now, if you open an account by June 16, you’ll pay absolutely zero management fees for six months. There are also never any fees when you want to withdraw your money; they do charge a fee if you transfer assets to another financial institution.
3. You don’t need a massive amount of savings. Banks and investment advisors may require minimum investment amounts that range anywhere from $10,000 to $1,000,000. All you need with RBC’s InvestEase is $1,000 to be invested in either a TFSA, an RRSP or a non-registered account. Even with lower amounts, InvestEase makes it super-easy to see your growth potential, and provides estimates on how much you could earn by just sitting back and watching. For instance, if you invest just $1,000 now, and add payments of $500 per month, you could have $407,913 in 30 years*. That number can certainly be eye-opening for many people who don’t think they have enough cash on hand to invest.
4. You can feel confident your money is growing while you sleep. One of the best things about RBC InvestEase is that you never have to spend time stressing about your investments. RBC InvestEase’s portfolios have all been developed by professional portfolio managers with extensive industry experience—so you know you can trust their choices. Their staff also manage your portfolios on an ongoing basis, so you never have to sweat the details, and can leave the buying and selling to the pros.
5. They make it easy to track your progress. Many people want to know exactly how their money is doing at all times, not just once a year, and crave statements that are easy to decipher. RBC InvestEase’s digital format is refreshingly simple, and so intuitive you’ll be able to understand everything in an instant—leaving more time for espresso dates or that new Pilates class you’ve been wanting to try. Whenever you log in, you’ll find easy-to-read charts and graphs that update you in anytime about your money.
6. There’s still a live person behind the scenes. Though we’re way beyond being wary of technology, it’s still sometimes nice to know you have the option of speaking with a real-life person, anyway. For anyone with RBC InvestEase, accredited Portfolio Advisors are always just a phone call or email away. They’re professionals who can provide all sorts of advice, and can help you set your goals, choose your securities, build the right your portfolio, buy investments and rebalance manage it along the way.
7. Your investing can reflect your values. When you’re not personally choosing every company you’re investing in, it can be hard to know whether your portfolio is making a positive impact on the world (or if it’s mostly made up of companies you wished weren’t around). That’s why RBC InvestEase introduced its Responsible Investing Portfolio. When clients opt in, they can trust that their ETFs won’t include companies that are considered controversial (tobacco or firearms, for instance) and that the remaining brands will have all gone through an in-depth environmental, social and governance (ESG) assessment. Responsible Investing Portfolios will only be filled with companies that score the highest on ESG factors.
Overall, RBC InvestEase may be right for Torontonians who’ve been meaning to invest, but just haven’t gotten around to it yet (we get it—planning a holiday is way more interesting than planning a portfolio). All you need to do to get started is take this super-quick online questionnaire, and they’ll take it from there. Before you know it, you could make some good money by doing absolutely nothing—or rather, by doing the things that you actually want to do.
*These projected returns are for illustrative purposes only and do not represent the results of any RBC InvestEase Inc. client, past, present or future. Actual results may vary.