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Humans vs. robots: Which advisor is better?

Automated advisors are a key player in financial portfolios — but are machines better than people?

Finder is committed to editorial independence. While we receive compensation when you click links to partners, they do not influence our opinions or reviews. Learn how we make money.

Investing is becoming easier and cheaper thanks to invisible programs working behind the scenes to match investors with the best ways to grow their money. These automated bots – called “robo-advisors,” – deliver online financial management services designed to supplement, or take the place of, human financial advisors.

Unlike traditional advisors, who review your financial situation, talk through your goals and customize a portfolio to suit your needs, robo-advisors automatically select investments for you based on computer algorithms programmed with your risk tolerance, financial capability, goals and timeline.

Although the concept of allowing a “robot” to manage your finances might sound a little futuristic, auto advising services can benefit many consumers. Robo-advisors can manage basic portfolios at a much lower cost than people can — and may even pick up on investment trends faster, thanks to specialized technology.

What is a robo-advisor?

A robo-advisor is not actually an advisor at all — nor does it refer to a single entity. Rather, it describes any number of online platforms that track investment trends, follow an algorithm designed for a client’s portfolio preferences and recommend opportunities to save or invest.

Although “robo-advisors” sound like something out of Terminator, there’s nothing made up about these technology-based financial players. Robo-advisors in Canada currently manage around $5.5 billion USD for clients (over $7 billion CAD), and this number is expected to climb dramatically over the next decade.

Compare robo-advisors

Name Product Minimum deposit to invest Funding methods Management fee Available Asset Types
Wealthsimple Invest
Direct deposit, Bank transfer
0.40% - 0.50%
Get a $50 bonus when you open and deposit $500 in your account. Trade and Cash accounts are not eligible.
Questwealth Portfolios
Direct deposit, Bank transfer
0.20% - 0.25%
Stocks, Bonds, ETFs, Commodities
A robo-advisor offering low fee portfolios that are actively managed and dynamically rebalanced when market conditions change.
Automatic bank withdrawals
The Moka app rounds up every purchase you make to the nearest dollar and invests the spare change into low-cost exchange-traded funds (ETFs).
Direct deposit, Bank transfer, Automatic bank withdrawals
Receive a cash bonus of $50.00-$500.00 when you open a new Justwealth account. RESP accounts require no minimum deposit to begin investing.

Compare up to 4 providers

Who are robo-advisors best for?

Automated advisors are best for basic portfolios that aren’t overly complicated or complex. They are also helpful if you’re on a budget, typically offering lower fees than typical advising services.

If your portfolio includes many components, you have a sizeable investment or you’re looking for individualized, customized options, a human advisor might be a better fit.

How do robo-advisors work?

Because these advisors work via software, you’ll typically fill out a financial questionnaire to help “program” that software with your investment preferences.

Your preferences can include:

  • Your personal risk tolerance. You specify whether you’re looking for high-risk investments or prefer lower-risk opportunities.
  • Your age and investment timeline. If you’re a 22-year-old college student, you’ll have much different financial needs than, say, a 60-year-old who’s ready to retire.
  • Your retirement goals. Aiming to be a millionaire by retirement? Your robo-advisor needs to know to plan how to get you there.
  • Your current portfolio information. Folding in your current investments results in a fully informed advisor — and decisions that are more likely to successfully meet your goals.

What are the benefits of a robo-advisor?

Many people value the ease of a robo-advisor’s automation when it comes to managing and growing their investments, among other benefits that include:

  • Minimal human error. Leaving a “robot” to manage your money and investments might feel uncomfortable initially. But a lack of unintended errors that come with being human is one of its biggest benefits. There’s no panicking and selling off a stock too early and no messy emotions that can get in the way of long-term financial growth.
  • Lower fees. The cost of an automated advisor is typically less than what you’d pay for a human one.
  • No awkwardness. If you’ve ever been in the uncomfortable situation of not getting along with your financial advisor, you’ll appreciate this benefit. Turns out, robots don’t mind being fired when it’s not a suitable match.

What are the drawbacks of a robo-advisor?

Because there are 2 sides to every story, there are also potential drawbacks to using a robo-advisor. For example:

  • Automated advisors can’t get to know you. Even the most sophisticated computer algorithm is still an algorithm. It can’t sit down with you, it can’t explain things to you and it certainly can’t listen to your dreams about the future.
  • Robo-advisors can’t handle complex portfolios. These advisors aren’t best for overly complicated portfolios. The rule of thumb is that assets of 6 figures or more need the human touch.
  • Questions may cost you. If you work with a human advisor, it often doesn’t cost you more to actually talk to them. Unless you subscribe hybrid human–robo management, you might have to pay to speak with a real person.
  • You might find it difficult to lose control. You’re always in control of your finances technically, but you might not be ready to hand over the reigns of your portfolio to a robot. If you prefer a more hands-on approach to digital guidance, a robo-advisor might not be a great fit.
  • You can’t auto manage employer retirement plans. This software can’t do much with retirement plans like RRSPs, so putting any money in a robo-advisor for a plan like that won’t do you much good.

Who offers lower fees?

Fees for using a robo-advisor or human advisor vary based on the company you go with — and even vary among human advisors.

Top-level private advisors, for example, tend to charge a lot more than beginning or standard firm advisors. Some companies charge a fee reflecting a percentage of your assets, while others may impose an annual or initial investment fee.

Still, robo-advisors are typically more affordable than human advisors. Here’s what you’ll pay for automated or semi-automated advisors through big-name providers.

CompanyOptions and featuresMinimum investmentPercentage or fee

Wealthsimple Invest

Go to site
  • RRSP
  • Stocks
  • Option to invest in Halal and socially responsible funds
  • Get a $50 bonus when you open and deposit $500 in your account. Trade and Cash accounts are not eligible.
  • $1
  • 0.40% - 0.50% annually
  • 0.2% fee built into ETF purchases

Nest Wealth

  • Dedicated human portfolio manager
  • Customized portfolio
  • Good for mature investors
  • $0
  • $20, $40 or $80 per month
  • 0.13% yearly Management Expense Ratio (MER)

BMO SmartFolio

  • Human-managed
  • RESP, TFSA, LIRA, RRSP (personal and spousal), RRIF (personal and spousal), joint and corporate/non-personal accounts
  • $1,000
  • 0.4% - 0.7%
  • Estimated 0.20% - 0.35% annual Management Expense Ratio (MER)


  • Dedicated Personal Portfolio Managers and expert advisors
  • TFSA, RESP, LIRA, RRIF, LIF, RRSP (personal and spousal) and non-registered accounts
  • $5,000 for non-RESP accounts
  • No minimum for RESPs
  • 0.4%–0.5% annually (min. $4.99/month for non-RESPs and $2.50/mo for RESPs)
  • Estimated 0.25% annual Management Expense Ratio (MER)

CI Direct Investing (formerly WealthBar)

  • CI Direct Investing is a premium robo-adviser offering access to two portfolio types: Private Investment Portfolio and ETF Portfolio.
  • RRSP
  • Mutual Funds
  • Get up to $10,000 managed free for a year when you sign up for your first CI Direct Investing account and fund your account.
  • $1,000 (you can make recurring deposits until you have this amount)
  • 0.35% - 0.60% annually
  • Annual Management Expense Ratio (MER) of 0.25%

RBC InvestEase

  • Dedicated portfolio managers
  • TFSAs, RRSPs and non-registered accounts (more account types to be included in the future)
  • $100
  • 0.5% annual management fee + applicable sales tax (billed monthly)
  • Estimated 0.11% - 0.32% annual Management Expense Ratio (MER)

Bottom line

To manage a basic financial portfolio, a robo-advisor can offer automated management and lower fees. These automated advisors also remove the human elements of error and fear that might hurt long-term financial growth and gain. However, human-managed investments can be more individually customizable and might be more suitable for complex, high-value portfolios.

Many popular robo-advisor platforms offer consumers the option to combine both a robo and human advisor for the best of both worlds. But in the end, choosing one over the other depends on your personal preferences, goals and assets.

Frequently asked questions

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

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