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Can You Use Betterment Canada? No, Check Out These 2 Robo Advisors Instead

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Is Betterment Available in Canada?

While it would be great to have a service like Betterment in Canada, at this time Betterment is not available for Canadians to use.

 

Is Betterment coming to Canada?

There has been no mention from Betterment that they’re interested in expanding to the Canadian market.

Interestingly, in March 2021 they bought Wealthsimple’s US book of business which makes me further believe they are focusing in the US market.

The plus though is that this also means Wealthsimple is focusing even more on the Canadian market, so fingers crossed we see more, innovative features from the homegrown Canadian market leader.

 

2 Alternatives for Canadians

 

1. Wealthsimple Invest

Current Offer: $50 Cash Bonus

As alluded to above, Wealthsimple Invest is an excellent robo-advisor service for Canadian residents looking to invest into diversified ETFs with low management fees.

Founded in 2014 as a digital first company, Wealthsimple Invest offers three different risk-based portfolios to match user needs:

1. Conservative (30% equities, 70% fixed income)

2. Balanced (50% equities, 50% fixed income)

3. Growth (75-90% equities, 10-25% fixed income).

 
Additional key features include:

Auto-deposits: To ensure your portfolio continues to grow

Dividend Reinvesting: To keep your money working for you

Automatic Rebalancing: To continuously take advantage of market movements, you can set it and forget it, feeling confident that your money is being managed in a way that matches your risk profile.

In addition to Wealthsimple Invest, if you’re ready to start trading yourself, you can leverage their Wealthsimple Trade platform.

With $0 commission fees, you can purchase your favourite stocks on an individual level, as well as invest in crypto through their Wealthsimple Crypto offering.

In fact, they go a step further by even offering to streamline your tax preparation through their Wealthsimple Tax product.
 
 
Learn more at Wealthsimple.com
 
 

2. BMO Smartfolio

BMO Smartfolio is another great option available to Canadian residents looking for hands-off investing.

BMO requires a slightly higher minimum investment of $1000 and fees are based upon how much you have invested with the Smartfolio, starting at 0.70% for the first $100,000 invested.

BMO Smartfolio also has dedicated advisors managing your portfolio (unlike a robo advisor) for those who prefer that human touch and the experience of an actual person working on your portfolio.

BMO also offers a much wider range of risk-tolerance-based portfolios than Wealthisimple.

Compared with Wealthisimple’s three portfolios, BMO Smartfolio offers five.

  1. Capital Preservation portfolio: 90% corporate bonds and government bonds, and 10% equities/ETFs
  2. Income portfolio: 30% equities, 70% bonds
  3. Balanced portfolio: 50% equities, 50% bonds
  4. Long-Term Growth portfolio: 70% equities, 30% bonds
  5. Equity Growth portfolio: 90% equities, 10% bonds

 

Why Has Betterment Become So Popular?

Betterment arose as one of the first robo advisors after the 2008 financial crisis.

What’s great about Betterment is that it was one of the first robo advisors to come up with customized, automatic rebalancing based on user risk tolerance.

Another prized aspect of Betterment is that the ETFs in its portfolios are globally diversified.

Why else would someone want to invest post-crisis if they didn’t feel the assurance of a globally diversified portfolio?

Add to that tax loss harvesting and now you have a minimized tax burden to your investments.

Another great selling point of Betterment is the low management fee, ranging from 0.25% to 0.40% per year. Couple that with a minimum balance as low as $10 and you have a recipe for mass interest.

That’s lead to 500,000+ customers and $21 Billion USD being managed, as per their website.

Betterment combines its awesome rates and robust investment products with a wide range of other financial products including: a high-yield savings account (0.40% APY), no-fee chequing account, debit card, and cash-back rewards.

The only area in which Betterment falls short is in extending its discount services to self-directed investors who want to invest in individual stocks or precious metals.

 

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Yusuf Ahmed

I'm just your average guy, trying to make my money work for me. I love to save and I love to write! I spend my free time digging into the stock market and checking out tools.