Wealthsimple Customer Reviews
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Wealthsimple is by far the best robo-advisor with a human touch. Have experimented with many other providers but stuck with these guys as they were the most transparent and had the best returns from all services.
Can't wait to see what the future holds.
What is Wealthsimple?
Wealthsimple is an online wealth manager also known as a robo-adviser
Wealthsimple was founded in Canada in 2014 and launched in the UK in September 2017. It has amassed 175,000 clients with £4.8bn in assets under management (as at end February 2021).
The company’s mission is to offer ‘simple, sophisticated, and affordable financial products. And make sure they’re available to everyone’.
Wealthsimple offers a pension, stocks and shares ISA, Junior ISA and a personal account. It offers multiple portfolios that can be run on a socially responsible or traditional basis.
There are three levels of service for each of its products: Basic, Black and Generation. Access to the black and generation packages is dependent on the amount customers have available to invest, and the accompanying fees fall as investors move from the basic to generation service. The range of service levels shows Wealthsimple is trying to attract everyone from those with limited funds to the very well off.
While the company is all about its tech, investors can access humans over the phone and via webchat.
Wealthsimple also offers an ‘award winning’ magazine which it says provides helpful news and content for its investor base.
Investing with Wealthsimple
Wealthsimple is all about passive investment and diversification.
The wealth manager says that active managers usually fail to beat the index and that the key to making money lies in spreading risk across asset classes.
Wealthsimple offers traditional and socially responsible investment portfolios. There is no minimum investment for the traditional, but investors need at least £5,000 to access the SRI funds.
As with other robo-advisers, investors sign up online following a straightforward process. It is simple and quick, and ultimately recommends a portfolio based on answers to a risk assessment questionnaire.
The only notable difference to other robo-advisers is Wealthsimple’s transparency. They make clear the funds included in the portfolio before you invest.
Wealthsimple stands out thanks to its SRI offering and the fact it does not impost a minimum investment for its traditional portfolios.
As you should expect from a robo-adviser Wealthsimple offers an app that can be downloaded to mobile devices from which investors can access their accounts.
It is essentially a mobile version of their website, which was twice awarded the Webby Award winner for the world's best financial website for being simple, intelligent and user-friendly.
The app is certainly easy to use and intuitive.
Potential investors can set up an account using the app, and once registered and investing, investors can make contributions, check balances and keep up to date with performance.
Wealthsimple’s app also hosts comprehensive educational content and articles.
Wealthsimple Charges and Fees
The charges from Wealthsimple are transparent and - as is typical for robo-advisers - they are pretty low. Wealthsimple is comparable to its nearest competitors but it is not the cheapest on the market.
The basic service has an annual management charge (AMC) of 0.7% with additional fees averaging at 0.2%, which cover the costs charged by the underlying funds.
The Black and Generation services both have an AMC of 0.5% and additional average costs of 0.2%. There are additional services included for these offerings but are only available to those with more to invest (see table below).
Wealthsimple’s AMCs are 0.05% cheaper than Nutmeg and Moneyfarm but 0.04% higher than Wealthify.
Wealthsimple does not charge exit fees and will also cover any transfer fees charged by other providers.
The manager also has an offer of zero fees on pension transfers.
|What’s on offer?||Basic||Black||Generation|
|Annual Management Charge||0.7%||0.5%||0.5%|
|Services||Perfectly matched portfolio|
|Access to investment advice|
|Direct debit contributions|
|Dedicated investment adviser|
|Ongoing portfolio monitoring|
|Portfolio and pension reviews|
Wealthsimple Personal Account
A personal account is useful for those who have reached the £20,000 investment limit for their tax efficient ISAs, but who still want their money invested. Personal accounts incur capital gains and income tax, but they are not subject to investment limits. Wealthsimple imposes no minimum investment nor does it charge for withdrawals.
Wealthsimple charges 0.7% AMC for the personal account run on a basic package. For those with £100,000 to invest the Black package charges 0.5% and for those with £500,000 the Generation service is available.
Wealthsimple offers a range of asset classes that reflect investors’ risk levels. These are restricted to stocks and bonds, but they do span different geographies. There are also socially responsible investment strategies available.
While Wealthsimple may not be the cheapest, it offers a host of services that justify the extra cost. It has put genuine effort into the tech supporting the services and also offers access to human advisers.
Wealthsimple Investment ISAs
A stocks and shares ISA is a tax efficient way to invest. Subject to a £20,000 investment limit, investors do not pay capital gains or income tax.
The costs for the ISA are the same as for the other Wealthsimple products: 0.7% AMC for the stocks and shares ISA run on a basic package. For those with £100,000 to invest the Black package charges 0.5% and for those with £500,000 the Generation service is available.
Stocks and shares ISAs are invested passively across equities and bonds. Depending on the investors’ appetite for risk, their money will be allocated differently across the available assets. For example, for the most risk averse investors, 80% of their fund is allocated to fixed income, of the remaining 20% in stocks, the lion’s share goes to the UK and US. For the most aggressive investors, 100% can be allocated to stocks.
The SRI strategies are also available, but Shariah compliant funds are limited to investors in the US and Canada.
Fees are comparable with competitors but the access to different service packages suggests Wealthsimple understands about catering to different types of client perhaps better than others.
The manager’s median risk balanced portfolio delivered 7.12% in the 12 months to end of January 2021, outperforming Nutmeg, Wealthify and Moneyfarm.
Wealthsimple Junior Investment ISAs (JISA)
Junior ISAs can be set up for children under 18. The tax-free contribution limits are £9,000 a year.
The junior ISA costs are the same as for the other products offered by Wealthsimple: 0.7% AMC for the JISA run on a basic package. For those with £100,000 to invest the Black package charges 0.5% and for those with £500,000 the Generation service is available.
The range of investment strategies are the same as for the ISA and Pension.
Relatively few other platforms have been willing to offer junior ISAs since they have quite low contribution limits, so this already sets Wealthsimple apart. In addition, its zero minimum investment levels make it attractive for those with small sums to pay in.
Wealth simple offers a self-invested personal pension (SIPP). These products give individuals tremendous flexibility on how they invest their retirement fund.
As with the ISAs and personal account, Wealthsimple charges: 0.7% AMC for the SIPP run on a basic package. For those with £100,000 to invest the Black package charges 0.5% and for those with £500,000 the Generation service is available.
As with the other investment products, there are a range of strategies available to SIPP investors including SRI. Wealthsimple will ask investors to fill out a questionnaire online or via the app which establishes appetite for risk. A tailormade investment portfolio is then offered which outlines allocations to stocks and bonds, and the recommended underlying funds.
Wealthsimple yet again sets itself apart from many robo-advisers by offering a pension as well as an ISA in its product range. Its performance beats that of its closest competitors and its fees are comparable (see other sections).
Wealthsimple Investment Portfolios
Wealthsimple invests on a passive basis and diversifies assets across equities and bonds.
The robo-adviser offers three strategies balanced, growth and conservative – which it also extends to socially responsible investment funds.
The balanced portfolio offers 50%, 60% and 70% equity allocations, the growth portfolio has 80%, 90% and 100% equity allocation while the conservative offers 20%, 30% and 40% allocations to stocks.
The manager will rebalance portfolios regularly to reflect changes in market conditions and ensure strategies are still in line with investors’ risk profiles.
The assets available are:
- UK Government bonds
- Global Company bonds
- Emerging Market Government Bonds
- UK Stocks
- North American Stocks
- Europe excluding UK Stocks
- Asian Stocks
- Emerging Market Stocks
Wealthsimple’s asset range is similar to that of other equivalent robo-advisers, but rival Wealthify also offers access to commodities and property.
Transferring ISAs to Wealthsimple
It is easy to transfer ISAs to Wealthsimple and not only do they not charge investors for joining but they offer to pick up the bill if the incumbent provider is demanding an exit fee. Wealthsimple does all the work for you and you can transfer in stocks and shares or cash ISAs, but it must be the whole balance.
Wealthsimple is also offering to waive fees on transfers in.
Wealthsimple is categorised as robo-adviser which means investors can access off the shelf, products online which are aligned with investor’s willingness to take risk.
Its main competitors are Nutmeg, Wealthify and Moneyfarm, and in this section we look at how they compare.
Overall Wealthsimple is slightly cheaper than Nutmeg and Moneyfarm, but marginally more expensive than Wealthify. Its notable edge is in offering different packages based on the amount customer’s have to invest, which none of the others do, and a dedicated investment adviser for the biggest investors. For all other customers, they offer access to advice ‘whenever the need arises’.
Wealthsimple versus Nutmeg
Nutmeg is the UK’s most established robo-adviser and probably presents the strongest competition for Wealthsimple. They are both targeting first time investors, but Nutmeg sets minimum investment amounts. Nutmeg’s offering is not as attractive to those with large sums to invest since it offers no discount on fees, giving Wealthsimple the edge.
Like Wealthsimple, Nutmeg offers personal accounts, pensions, ISAs and Junior ISAS, but it also offers a Lifetime ISA.
Nutmeg’s investment strategies comprise fully managed, smart alpha and fixed allocation. Like Wealthsimple it also offers an SRI portfolio. Investors can dial the risk up and down to suit their appetites.
Nutmeg’s AMC is 0.05% higher than Wealthsimple’s. While the targets for the investment strategies are slightly different, for the sake of comparison, over the three years to February 2021 Nutmeg’s risk level 5 fixed allocation portfolio returned 21.9% while Wealthsimple’s risk level 5 balanced portfolio returned 23.3% to January 2021.
Wealthsimple versus Wealthify
Wealthify has a similar target market to Wealthsimple. There is £1 minimum investment and fees are lower than Wealthsimple’s suggesting it is targeting those with smaller sums.
Wealthify recently added a SIPP to its product range which already includes an ISA, Junior ISA and general savings account. Minimum investment to set up a Wealthify pension is £50.
Investment strategies are run on a passive basis, but the manager includes more asset classes than Wealthsimple. In addition to equities and bonds, investors have access to commodities and property.
The robo-adviser also offers access to several ethical funds.
Wealthify’s fees are lower than Wealthsimple coming in at 0.76% including underlying charges. In terms of performance, Wealthify’s adventurous fund returned 5.06% for the 12 months to end of 2020.
Wealthsimple versus Moneyfarm
Moneyfarm appears to be targeting those with at least a fair sized investment since it imposes a £5000 minimum to start, or £1500 initial investment which must then be topped up with a regular direct debit to get it to £5000.
Moneyfarm does not offer a junior ISA but otherwise it has the same product suite as Wealthsimple.
Moneyfarm has seven different investment portfolios which are matched to investors based on their risk appetites. As with Wealthsimple they invest in a mix of bonds and equities.
In terms of performance, Moneyfarm lags Wealthsimple. The risk five portfolio performance from Moneyfarm over the three years to January 2021 was 12.7%.
Fees are slightly higher than Wealthsimple’s at 0.75% although these fall to 0.35% for those investing more than £100,000.
Wealthsimple 2020 performance
The following table lists Wealthsimple’s performance for the 12 months to 31 March 2020 versus its peer group
|Strategy||Wealthsimple return||Peer group||Difference|
|Growth portfolio 90% equity strategy||-11.98%||-9.65%||-2.33%|
|Balanced portfolio 60% equity||-6.75%||-7.71%||0.96%|
|Conservative portfolio, 30% equity||0.81%||-2.29%||3.1%|
|Growth SRI portfolio, 90% equity||-4.39||-9.65||5.26%|
|Balanced SRI portfolio 60% equity||1.54%||-7.71%||9.25%|
|Conservative SRI portfolio, 30% equity||2.26%||-2.29%||4.55%|
Wealthsimple 2019 performance
The following table lists Wealthsimple’s performance for the 12 months to 31 March 2019 versus its peer group
|Strategy||Wealthsimple return||Peer group||Difference|
|Growth portfolio 90% equity strategy||5.69%||6.04%||-3.05%|
|Balanced portfolio 60% equity||5.11%||4.85%||0.26%|
|Conservative portfolio, 30% equity||4.17%||1.71%||2.46%|
|Growth SRI portfolio, 90% equity||9.07%||6.04%||3.03%|
|Balanced SRI portfolio 60% equity||8.04%||4.85%||3.19%|
|Conservative SRI portfolio||5.71%||1.71%||4%|
Gill has 14 years’ experience in financial journalism, has been an editor on an FT publication and produced articles for Financial Times, Financial News, Pensions Expert, Pensions Insight, National Association of Pension Funds, Portfolio Institutional, Engaged Investor, IPE
Toby Triebel, European CEO at Wealthsimple gives us the lowdown on why ethical investing for millennials is so important
Interview date: 7th February 2019
I don't go into The City as much as I'd like these days, but when I do I always find myself taking pictures of adverts on the tube. I'm not sure why, maybe it's because, like the conductors jauntily abusing commuters on the platform for not "minding the gap", adverts on the tube tend to have a sense of humour.
Last time, I took a picture of a Wealthsimple tube ad, or I thought I did, perhaps someone's head was in the way and I would have looked odd. Because I can't find it on my phone.
Anyway, funny ads on the tube are there to make something dull like commuting, into something fun. A mecca of puns, poetry, and protein supplements.
And that's what a new breed of digital investment platforms are trying to do with ESG investing. That is, make something that is exceptionally boring, enjoyable and fun. Obviously, you can know yourself, or read a book on how to better manage your stock portfolio, but investing is boring because if you want to successfully see your portfolio grow, you generally have to do nothing, for a very long time.
So, how do you balance a long term investment product, with being an ethical investor, yet capitalistic, and being boring, yet exciting?
We talk to Toby Triebel, European CEO at Wealthsimple to find out...
You've got a fairly extensive background in financial services, mainly on the institutional and financing side. What was the incentive for taking on leadership of Wealthsimple in Europe and what do you think it does better than anyone else?
I first heard about Wealthsimple when I was still running my own fintech start-up Spotcap, an online lending platform for small businesses.
I actually pitched my business to Paul Desmarais III, the current Vice-President of Power Corporation and Power Financial, who have invested $120M in Wealthsimple to date, for an investment round. He didn't end up choosing to invest but instead introduced me to the founding team at Wealthsimple who were at the time thinking about launching internationally.
With Spotcap, we founded the business in Germany in 2014 and quickly expanded into the UK, Netherlands, Spain, Australia and New Zealand. Wealthsimple was looking to break into the UK market and it seemed like the perfect fit. I had just closed an investment round from a strategic partner with Spotcap and decided to step down and join Wealthsimple as CEO Europe, continuing to support Spotcap in an advisory role.
Even though I came from traditional financial services myself, I didn't have the time, or desire, to manage my own investments and realised how complicated current providers made it to invest with everything from complicated language to hidden fees. It just seemed there had to be a better way to get invested where you didn't need a degree in finance to get started.
What do we do better than anyone else?
Wealthsimple humanises the experience of wealth management. A central theme to our company and something we really believe in very strongly is this concept of human. How do you create a human financial services company? For us it means a couple of things:
Our service combines great technology with human advice to provide people with smart investment portfolios that are built with their financial goals in mind.
The second part is around the humanity in our design and branding. We're building a lifestyle brand in financial services - which we don't think anyone has ever successfully done - and a big part of that is telling honest and candid stories about money. So we do things like have a Money Diaries series where we speak with interesting people - like Jon Hamm or Margaret Atwood - about their relationship with money and focus our brand campaigns around making talking about money less of a taboo.
Thankfully, the world these days seems to be a more conscientious place. With millennials embracing ethical lifestyles as well as investing. How do your Socially Responsible Investment options differ from the standard products?
Many people, younger generations especially, want to believe in their investments. Millennials grew up during the financial crisis where trust in the financial system was shattered in many ways and they want to know that their investments actually represent their own values and will hold companies accountable.
The growing popularity of socially responsible investing may also be part of a broader shift around what consumers expect from businesses. We're past an age where businesses just exist to make money. We expect them to be good corporate citizens and have a positive - or at minimum neutral - impact on the world.
All our portfolios are designed to help clients build wealth over the long term, and we don't compromise on our strategy for our SRI (socially responsible investment) portfolios. They are globally diversified, offered at the same low fees as our regular portfolios and available with a £5,000 invested minimum. Our SRI portfolios are intended to be viable as someone's entire portfolio.
They are different from our standard portfolios in the way that funds are screened for inclusion in the portfolio.
First, every fund that is selected is screened against environmental, social and governance factors to make sure companies included are making social responsibility a business priority. This is what's called a positive screening method and includes 37 checks and balances to screen each individual fund (knowing that there are typically 10-12 included in your Wealthsimple portfolio).
Second, negative screening is also applied to exclude any companies that are considered to be involved in negative practises like the tobacco or arms industry.
Interestingly enough there is some research that suggests socially responsible investing may drive better investor behaviour. If an investor isn't just investing for their financial gain but also to support something he or she believes in, the investor may be less inclined to - for example - pull out of the market during a downturn.
In total we see about one out of every four clients investing in a socially responsible portfolio.
Long-term investing can be a fairly boring concept. With new digital investment platforms trying to make it exciting, do you think there is a danger in making long-term investment accounts too easily accessible so that inexperienced investors will be tempted to tinker and switch rather than leave alone and grow?
We have this really interesting challenge of trying to create a sexy brand around a really boring topic. We know that smart investing is super boring. It's about buying passive, low-cost funds and sticking to that over the long term, no matter what your emotions are telling you to do. So really it comes down to giving people access to the right tools and information and most importantly, setting really great financial behaviours.
It starts with building real, authentic trust with clients and how we think about that is our marketing, or the brand we're building, is the promise that we make to the marketplace and then our product is the way in which you deliver on that promise each and every day. What new players have done really well is create an investing experience that puts the client first and makes sure there is transparency in what is being offered and how much it is going to cost.
We have about 1 in 3 clients looking at our app daily. Their portfolio balance, earnings and time-weighted returns are all clearly displayed and we've added a dashboard of our magazine content below that is specifically customised to clients depending on whether they are starting out for the first time or are seasoned investors.
The other part is about encouraging and building the right financial behaviours. We do this through our Magazine by writing pieces on topics from why we think the stock markets will go up in the long run to how best to understand financial concepts like pound-cost averaging.
We also have a series of emails and prompts that reinforces the discipline of good investing that we send out when we see volatility in the market. In response to whatever has happened - whether it be the initial Brexit vote or Trump getting elected - we send out an immediate note to our clients that we entitle the 'Keep Calm and Carry On' series which talks about what's happened, what it means for you and why you should likely do nothing about it. It's been incredibly appreciated by our clients who are scared or do freak out in those moments to be reminded of the discipline of sticking to your plan, and we also do this on the reverse, when we are seeing moments of strong growth in the market.
I think there is a lot of responsibility around how we feel about educating people to be smarter investors over time. And there is a lot more we plan to do on that front by building even more helpful investment advice into our products.
The major appeal of digital wealth platforms is that the fees are considerable cheaper than established providers. As with MiFID II forcing funds to pay for research directly rather than pass it on to their clients. Do you think digital wealth platforms will be able to absorb the underlying fund management costs?
MiFID II is all about giving people greater choice, and protection, in the financial products and services they are choosing to use. It's about restoring confidence in the financial services industry where many feel that trust has been completely broken. What new players have done better than the traditional industry is making sure fees, both service and underlying fees, are clearly displayed upfront and that nothing is hidden.
There isn't a way for digital wealth platforms to absorb the underlying fund management costs as these fees aren't charged by the platform to the client, they are factored into the funds themselves. What providers should strive to do instead is make sure they are clearly communicating both their service fee, and underlying fees, to clients. Ours are both included on our website homepage.
We're not trying to compete on price. We are a low cost option, but we're not trying to drive a race to the bottom. We do have an advantage where the average person in the UK is still paying 2.56% for investment advice and management, which is higher than Canada (our home market) where we always thought people were paying the highest fees in the world.
There is an enormous space between what the incumbents are paying versus the new players like us. So for us there isn't a drive to take the cost to zero because the fees that we're charging are almost a convenience fee. You could do better if you managed your own money, but we charge a small cost to do all the work for you.
And finally, what would you say would be your top three online resources for investors to become more confident investing?
- Boring Money - Their team does a great job of breaking down complicated investment terms and making them understandable to everyone, which is especially important for people who are starting out for the first time.
- Money to the Masses - Damien reviews all the major players in the UK and writes articles on easy investment tips that are as relevant to a seasoned or first-time investor.
- Vestpod - We're huge fans of Emilie's monthly newsletter on unbiased financial information and resources for women.
Richard founded the Good Money Guide (previously Good Broker Guide) in 2015 and has been a broker for 20 years most recently at Investors Intelligence and previously a multi-asset derivatives broker at MF Global (Man Financial). Richard started his career working as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson) after interning on the NYMEX oil trading floor in New York and London IPE in 2001 & 2000.
Wealthsimple Frequently Asked Questions:
Is Wealthsimple any good?
The short answer is yes. It has outperformed in most strategies and for most risk profiles. Wealthsimple offers good value for money, and the option to scale up packages in return for larger contributions makes sense. The commitment to technology is impressive but Wealthsimple also offers a high level of human contact when needed.
Does Wealthsimple have fees?
Yes. 0.7% AMC for its basic package plus 0.2% underlying charges. For those with £100,000 to invest the Black package charges 0.5% and for those with £500,000 the Generation service is available.
How does Wealthsimple make money?
Wealthsimple makes money by charging a management fee for investing passively across the stock markets and in bonds.
How do you invest with Wealthsimple?
The provider calls it ‘autopilot investing’ in other words you pass all the decision making to them. It is just a matter of setting up an account online and then filling out Wealthsimple’s risk questionnaire. Once they have established your risk profile you just hand over the money and they get started.
How to withdraw funds from Wealthsimple?
This can be done via Wealthsimple’s website and is usually straightforward. However, there are numerous reviews suggesting that it can take time to get hold of your money, which has caused some anecdotal frustration.