So you’ve done a little bit of research thinking of a new robo advisor to try out and you happened across Ellevest.
With the many different platforms out there that all aim to do similar jobs, it can be difficult to sift through them all and find the details through the sales pitches.
With this article, we intend to get into the nitty-gritty of Ellevest and its unique design philosophy. In the end, you will have a much clearer understanding of the platform and the things it is capable of.
Since its inception in 2014, Ellevest had grown in popularity quickly. Its rapidly expanding nature has made it the topic of much debate in the investing community.
- They give you direct access to a CFP® for your investing needs (with the premium offering)
- Offering a female focused strategy
- No account minimum* (see below)
- No account closing or opening fee
- Executive coaches for career planning are offered (with the premium offering)
- Tools for building an emergency fund are included
- Portfolios offer real estate Exchange Traded Funds (ETFs) as well as stocks and bonds
- This robo advisor invests for you based on an algorithm
- You do not pick and choose your own stocks and investments
- Fees range from 0.25% to 0.50% based on the plan
What is Ellevest?
Ellevest is a robo advisor that was originally designed to suit the needs of women in the world of investing.
Some believe the “gender-neutral” investment industry defaults to men’s salaries, career paths, and lifespans. Ellevest aims to bridge that gap and factors in the unique things that affect women, like the fact that they live longer and are paid less on average.
Ellevest states on their website that they use a “gender-specific algorithm” to accomplish these goals. In addition, they claim that 86% of investment advisors are men, and that the gender-neutral rules of wall street do nothing to alleviate this bias.
They use a very structured and targeted approach when it comes to investing. You’ll set up goals and milestones that you will be able to view and change at any time.
When you first start out, you will also be able to track your progress and see how far you are from reaching your goal.
Ellevest is a good platform for beginners who need more guidance through the investment process. For more experienced investors, Ellevest can be great if you would like a diversified portfolio created for you.
Though Ellevest does not support as many types of accounts as its competitors, it does make up for this in other areas like ease of use and providing valuable content to help anyone invest.
How To Open An Ellevest Account
The steps to open an Ellevest account are similar to those that you will go through with most other investment platforms.
You will have to meet a few requirements listed here:
- Must be 18 or older
- You must have a Social Security Number
- Have a residential address in the U.S. or U.S. territory
- Be a U.S. citizen, have a U.S. residency card, or a valid U.S. Visa
As long as you check all those boxes, you will be able to set up your account pretty quickly.
They will ask you a few questions and you will be off to the investing races!
Coaching And Advisors
Ellevest really shines when it comes to guiding you through your finances.
They offer the feature of supplying you with a totally free financial plan upon activating your Ellevest account. This makes it very simple to track your progress through your plan.
While the customer service hours have seen some negative reviews, they have an expansive team of advisors to support you in the way of financial advice if you opt for their premium offering. They offer different levels of financial advice, but we’ll get into this a little later.
In addition to investment advice, they also offer career guidance as well with their premium offering. They claim that women are less likely to ask for a raise or promotion than men. The Executive Coach service will assist you in reaching your career goals.
Women Specific Platform
If you scroll over the Ellevest website for any length of time, you will find that they built a platform to assist women in their financial needs.
They also take into consideration the fact that women, on average, live longer than men and as such will need more money for retirement.
In the way of investing they will make specific recommendations based on a gender-specific salary curve in order to best fit your particular case. They will use this information further to craft a portfolio that is unique to your needs.
Ellevest Plans and Pricing
The Ellevest platform offers three different levels to their service which we will detail here:
Their basic plan which has a cost of 0.25% of your total managed assets. This plan has no minimum balance* so you can start using it as quickly as you like.
You will have access to their free emergency fund along with the support of automatic rebalancing, no penalty withdrawals, and support from the Ellevest Concierge Team.
The second tier with Ellevest is Premium which has a cost of 0.50% of total managed assets. You will have to maintain an account minimum of $50,000 in order to have access.
With it, you will have the opportunity to speak with a CFP® for a 1 on 1 advisor meeting of your finances. Ellevest premium also allows you to speak with the Executive coaches for all your salary negotiation and career needs.
Ellevest Private Wealth
Their highest-tier service does not list a price, instead stating they will be assessing the assets managed to determine how much it will cost. You will need an account minimum of $1,000,000 with Ellevest to unlock this tier.
Private Wealth offers a dedicated financial advisor and investment team that will assist you with your investments and financial planning. You will get a completely customized portfolio with Ellevest Private Wealth.
- Traditional IRA
- Roth IRA
- Rollover IRA
- SEP IRA
- Financial Planning (with premium)
- No fees for opening/closing accounts
- $0 minimum account balance*
- Advisors for career and finance
- Milestone focused plan
- Woman focused investing strategies
- No tax-loss harvesting
- A small number of account types
- Customer service is only during regular business hours, but they do their best to get back to you very quickly
Ellevest Platform: The Verdict
Like anything in the world of investing, there is no one size fits all to things. Some people are going to benefit from the Ellevest platform and some are not.
If you are a woman who is new to the world of investing, then the Ellevest platform was quite literally made just for you. Their entire system was built with you in mind and to cater to your needs specifically.
Men who are investing for the first time may see some large benefits to the structure that Ellevest offers as well. They will be able to make use of the financial planning and milestone system just as well as a woman.
However, someone who is more experienced in the world of investing may see more benefits in another system. The limited number of accounts may be a disadvantage.
With this being said if you are looking for a specific investment approach that is targeted in one way or another you may find Ellevest to be the perfect system for you.
Ellevest may also appeal to those who want to have real estate ETF’s in their portfolio.
The $0 minimum* and great structure are perfect for a beginner. But the 0.50% fee for accounts of over $50,000 is higher than some of Ellevest’s direct competitors like Betterment. But it does come with additional perks, like access to CFP’s® and career coaches.
All in all, Ellevest is a well-built service for targeted investing and people brand new to the world of investments. It will offer you a great way to visualize where you need to be in terms of your retirement.
In addition, its concierge team is there to help you along the way if you feel yourself needing a bit of a helping hand to know what to do. And if you feel the need to have career assistance they will offer an Executive coach for you to meet within the premium tier.
Ellevest Digital doesn’t require you to maintain a minimum account balance. However, there are portfolio specific minimums (ranging from $1 to approximately $240). You may not receive the entire recommended portfolio until your account balance meets the respective portfolio minimum.
Rebalancing and Ongoing Management
Ellevest will not rebalance a portfolio until it meets the respective account balance minimum necessary to generate the required shares. This minimum is a function of portfolio allocation and the share price of individual holdings, which will vary.