Douugh investing review
Invest in digitally managed portfolios of ETFs for $4.99 per month.
Douugh Wealth offers automated investing in low-cost exchange-traded funds (ETFs). The fee is $4.99 per month for a Douugh account, and it gets you a checking account, savings accounts and access to its automated investing service. But you won’t have complete control over your investments, and you won’t know the exact ETFs you’re investing in.
What I think of Douugh Wealth for investing
Douugh offers a comparable automated investing service to many of the other robo-advisors on the market. At $4.99 per month, it offers a low-cost option to passively invest in ETFs, while also providing you with a checking account and savings accounts.
So if you’re looking to centralize your banking and investing, Douugh might be an option. But shop around, because other platforms provide a similar service at a lower cost — and some are even free.
Douugh only offers ETF investing, so it’s limited in that way. And when Douugh recommends a portfolio, it only shows the categories of ETFs in which your money will be allocated instead of the specific ETFs. For example, the app will tell you if your money is being invested in ETFs that track large-cap stocks, cash or Treasury inflation protected securities (TIPS). Knowing which ETFs you’re investing in might not matter to you, and those broader categories might provide enough information for your investing style.
In short, Douugh is designed for passive investors who want low-cost, automated investing. And at $4.99 monthly, Douugh provides exactly that.
How does Douugh Wealth work?
Douugh Wealth is a component of Douugh’s core financial management platform, which also includes a checking account and a savings account. It’s a registered investment advisor, which is a firm that advises individuals on investments and is registered with the SEC. But it’s a digital investment advisor, or a robo-advisor, so you aren’t getting investment advice from humans.
As a robo-advisor, Douugh Wealth recommends a portfolio of investments based on certain information you provide about your investing goal, time horizon and risk tolerance. Its algorithm matches you with a portfolio and continually monitors your portfolio, rebalancing it to stay aligned with your goals, time horizon and risk tolerance you established when creating the account.
It’s important to note that once you start investing in a particular portfolio, it can’t be changed, nor can you change your goal once you’ve set it. But you can have different goals, all with different portfolios. So these restrictions aren’t all that limiting.
Douugh Wealth builds custom portfolios of diversified exchange-traded funds (ETFs). ETFs are designed to be low-cost securities that track a specific index or sector, but they do come with an expense ratio. The average ETF expense ratio is around 0.45%, and Douugh states that it selects funds that have lower than average expense ratios.
Lastly, the company offers six different investment portfolios that range from conservative to aggressive. The company also offers an additional feature that allows investors to choose ETFs for companies driven by social responsibility.
Douugh Wealth fees are mostly comparable to the competition
Douugh charges a $4.99 per month “financial fitness membership fee” just to have a Douugh account. This fee is automatically deducted from your Douugh checking account or, if there are no funds available, your externally connected bank account.
While Douugh states it doesn’t charge brokerage or management fees, you do pay a fee for its service — but it’s called something else. Regardless of the name, the $4.99 per month fee is comparable to the competition. It simply depends on the platforms under comparison.
For instance, Stash provides a similar robo-advisor service for between $1 and $9 per month depending on the type of account you open.
On the other hand, Wealthfront charges a 0.25% annual advisory fee for its automated investing service. With an average monthly balance of $100K, the annual advisory fee would run you almost $250.
Then there are platforms like SoFi, which doesn’t charge any fees for its investing service.
Pros and cons
So what are the main benefits and drawbacks of investing with Douugh Wealth?
- Low ongoing costs. Pay only $4.99 per month for its service, which is lower than most annual advisory fees.
- You get access to a suite of financial accounts. When you sign up with Douugh, you get checking, savings and investing accounts.
- Passive investing. Invest automatically in low-cost ETFs.
- Investments are vague. Douugh doesn’t show you the exact ETFs it recommends for your portfolio, only broad categories.
- Invest only in ETFs. Douugh portfolios are made up of ETFs only.
Douugh investing feedback is minimal but leans positive
As of February 2022, Douugh is not accredited with the Better Business Bureau (BBB). It has no BBB rating, nor does it have any reviews or complaints.
Over on Trustpilot, Douugh ranks 2.8 out of 5 stars based on five reviews. Three reviewers gave the company 1 star, claiming issues with money transfers and poor customer support. Conversely, the other two reviews gave Douugh 5 stars and commended the platform for simplifying saving and money management.
|Better Business Bureau||Rating: NR|
|Better Business Bureau||Accredited? No|
|BBB customer rating||0/0 stars based on 0 customer reviews|
|TrustScore||2.8/5 stars based on 5 customer reviews|
|Google Play app reviews||4.1/5 stars based on 748 customer reviews|
|Apple App Store app reviews||3.5/5 stars based on 230 customer reviews|
|Data last updated||February 2022|
4 steps to get started with Douugh investing
Sign up for a Douugh account on the web, but you’ll have to transfer to the app to finish setting up your account since Douugh is an app-based platform. The process is similar whichever way you choose but the order in which you provide specific information is different.
- Go to Douugh’s website and select Sign up now, or download the Douugh app and select Create account.
- Enter your email address and create a password.
- Work through the steps, providing your name, date of birth, Social Security number, residential address and phone number.
- Set up your Douugh Wealth account from the home screen of your newly established Douugh account.
To create an investing account — or a “portfolio jar” — provide some additional information. This includes your employment details and citizenship status. Only US citizens can sign up.
Answer some qualifying questions and agree to Douugh’s terms and conditions. Once your financial profile is complete, set up and fund your first portfolio jar.
Alternatives to Douugh investing
Douugh Wealth might not be right for you, and there are several alternative robo-advisors to consider if that’s the case.
For instance, Stash is a subscription service that allows you to invest in stocks and ETFs. Pick your own investments or use its automated investing tool.
Stash offers three plans ranging from $1 to $9 per month. So if you want the freedom to choose your own investments but also want automated tools, Stash might be an option.
SoFi takes it a step further and offers stock, ETF and crypto trading with no commissions or monthly or annual fees. It too offers automated investing. So if you want the freedom of choosing your own investments and the ability to passively invest without any service fees, SoFi might be a better fit.