What is a Robo-advisor? Using Investopedia’s definition, a Robo-advisor is an online wealth management service that provides automated, algorithm-based portfolio management advice without the use of human planners.

You might think that this could be a lower-cost and effective way to manage your portfolio. But it is important to remember that while these “advisors” do the job of asset allocation just fine using the same investment software as a traditional advisor, that is where the benefits end.

Have a question on your retirement strategy? Need support and encouragement when the market is down? These more personal and professional benefits can only be accomplished with a real advisor. To understand how important these benefits really are, in an Investor Sentiment survey of 1,000 investors, 93% said it was “important” or “critical” that their advisor “helps them maintain a long-term investing approach,” and 83% wanted their advisor to help them “stay calm when the market drops.”1

Overall, the ultimate value in any relationship is going to be between an advisor and their client. That being said, there are some circumstances where a Robo-advisor will fill a need. “Financial planning is a process that involves much more than a simplified approach in allocating one’s investment portfolio,  states Edward Gjertsen, a Certified Financial Planner, and Financial Planning Association President. “It stands to reason that some practices may be considering Robo-technology to augment current offerings, especially for younger clients.”2

But as many people start seeing retirement up close and wealth accumulation becomes a real need, the role of a trusted advisor in planning decisions and evolving strategies can never be underestimated. Questions? You can call Mooney Lyons at 1-847-382-2600 or visit us at We can help ease the complexity and reduce the anxiety in many areas of retirement planning — so you can build a future on good financial sense.

1. Green, James J. 4 Things Clients Want From Advisors That Robos Can’t Do: IMCA. 25, Aug. 2015

2.Osterland, Andrew. Is the future for Robo-advisors bright…or a bust?

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