If you read the Wall Street Journal or listen to Bloomberg News, you’ve probably heard about robo-advisors. However, you may not know what it is or whether it’s the right service approach for your estate planning and investments.
Although it sounds like something from a science fiction movie, robo-advisors are quite ‘real’. They are automated digital investment advisory services – available online and through apps – that provide investment guidance without the intervention of a person, i.e. a human investment advisor.
Emerging in recent years as an alternative to traditional sources of advice, robo-advisors use computer algorithms, or sets of rules, to choose appropriate investments. The choices are based on a person’s risk tolerance, time horizon and other preferences indicated from an initial online questionnaire.