Schwab Intelligent Portfolios Review: Is It Worth It?

Schwab Intelligent Portfolios is ideal for cost-conscious investors who meet the $5,000 minimum investment threshold. You’ll need a minimum of $5,000 to get started, so this robo-advisor isn’t necessarily designed for the beginner investor unless you already have a chunk of change saved up to invest. Schwab also offers one of the widest selections of account types we’ve seen available from a robo-advisor. It combines the robo-advisor platform with unlimited support from a team of certified financial planners (CFPs). Average expense ratios vary depending on your portfolio risk, with aggressive portfolios average 0.20% and conservative portfolios as low as 0.06%.

Compare to Other Advisors

Some robo-advisors offer high-yield savings accounts with higher rates. Schwab offers a savings account with an interest rate of 0.48% as of this writing, as well as unlimited ATM fee rebates around the world, and no monthly service fees or account minimums. But those who have other plans for their cash and who desire a completely invested portfolio service may be turned off by this unavoidable cash allocation. Sitting on do-nothing cash may be good for investors who aren’t disciplined about deploying their cash reserves, especially when the market is in a down cycle. The BBB references a 2022 SEC settlement regarding misleading cash allocation disclosures in the robo-advisor product. Many Reddit users appreciate the premium tier for accounts over $25,000, especially the access to flat-fee financial planning.

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This service is particularly valuable for high-income investors or anyone with significant gains in taxable accounts. It aims to provide fully managed, diversified portfolios at no advisory fee. Before investing, consider your investment objectives and the fees and expenses charged. Like most flat fees, Schwab’s pricing is ideal for investors with higher balances. Schwab is one of the only online advisors we review that charges an upfront fee, which should be factored in when you compare the cost of services Schwab Intelligent Portfolios Premium is the company’s hybrid advisor that offers the same portfolio options as the free service, alongside unlimited access to certified financial planners.

Schwab Intelligent Portfolios Premium at a glance

• Keep in mind that with Schwab Intelligent Portfolios, you’ll need to meet the $5,000 account minimum to get started.
• However, the required cash position may reduce total portfolio returns, particularly in bull markets.
• Historically, Schwab’s portfolios have performed in line with market averages, thanks to their diversified, low-cost structure.
• This usually hovers around 10.0%, though may be slightly less or significantly more—up to 30%—depending on your risk profile.
• While functional, the app is more traditional and less sleek compared to robo-first platforms like Betterment or Wealthfront.

If you’d like access to an advisor who can give you personalized advice, check out Schwab Intelligent Portfolios Premium below. There is no limit to the number of Intelligent Portfolios accounts you can have (so long as there’s $5,000 in each account), customizing each with a different goal and strategy. Investors can tweak the allocation in Schwab’s recommended model by picking as many as three ETFs to remove and Schwab will replace them with an alternative. Keep in mind that with Schwab Intelligent Portfolios, you’ll need to meet the $5,000 account minimum to get started.

Good to know about Schwab Intelligent Portfolios

Expect to estimate your initial investment amount and how much you plan to save each month. Start by choosing a goal for your account, then fill out a brief questionnaire. To that end, you should know that many advertisers pay us a fee if you purchase products after clicking links or calling phone numbers on our website. It works by replacing sold securities with similar (but not identical) ETFs, maintaining portfolio integrity while complying with wash sale rules. Schwab’s tax-loss harvesting feature is automatically enabled for taxable accounts with a balance of $50,000 or more. Investing involves risk, including the possible loss of principal.

Because of the volatility of the stock market, investing will always carry risk. The company offers a wide range of investments, low fees and four trading platforms. Clients have 24/7 access to advisors with Series 7/63 or 7/66 licenses, though these advisors do not give personalized investment advice. Here are our top picks for best robo-advisors. Tax-loss harvesting is one of the selling points of having a robo-advisor manage your portfolio.

• The $30/month fee for Schwab Intelligent Portfolios Premium means that your annual costs could wind up being higher or lower than those of competing platforms, depending on how much you invest.
• As a Schwab Intelligent Portfolio investor, you’ll receive 24/7 support from customer service professionals who are based in the U.S.
• Schwab Intelligent Portfolios employs a similar technique as other robo-advisors when developing your individual investment strategy.
• Custommapposter is a website that shares useful knowledge and insights for everyone about finance, investing, insurance, wealth, loans, mortgages, and credit.

Schwab Intelligent Portfolios also allow you to opt into a Premium level of service. These accounts can bolster your retirement savings while simultaneously providing you with distinct tax advantages. Here’s a brief overview of account options, including both taxable brokerage accounts and tax-advantaged IRAs. When opening intelligent investor share advisor review your Schwab Intelligent Portfolio, you’ll have a large pick of both brokerage accounts and IRAs to choose from.

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Investors who don’t have $5,000 to open an account should check out Betterment or Wealthfront, which have rock-bottom minimum balance requirements. You earn a minimal APY on cash—reducing your overall returns by a not-insignificant amount. If you’re an existing Charles Schwab customer who’d like to put a portion of your balance under automated management, Schwab Intelligent Portfolios is a great choice.

It teaches beginners to have realistic goals and to manage risk properly, which should be the first things they learn about. The book is well written and organized and represents a great first book to read about investing. This made it a foundation stone for future educational material on investing.

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The performance of Schwab Intelligent Portfolios varies depending on the asset allocation chosen by the algorithm, the underlying market conditions, and the specific ETFs used. The standard Schwab Intelligent Portfolios service requires a minimum investment of $5,000. On average, the expense ratios for the ETFs used by Schwab range from 0.05% to 0.15%, which is much lower than the fees charged by actively managed funds.

Intelligent Portfolios is unique in charging no management fee, but portfolios tend to hold a larger cash allocation than other robo-advisors. The more expensive portfolios are higher than many other robo-advisors, but you still may fare better considering that you won’t have any management fees to worry about. The absence of these fees makes Schwab’s robo-advisor service an attractive option for cost-conscious investors. Charles Schwab Intelligent Portfolios is a robo-advisor service that provides automated investment management for clients seeking low-cost, diversified portfolios.

If you choose, these can be swept into an FDIC-insured account at Schwab Bank to earn interest. If you ever have a technical question about your account, you can call or email at any time to resolve the problem. You can then open multiple accounts within a single plan to help organize your goal planning. To get started, you’ll need to invest at least $25,000 and also pay a $300 one-time planning fee.

You’ll also get notifications when you’re falling short of your goal, whether it’s from pausing contributions or market conditions changing. The platform continually monitors and rebalances your portfolio to keep your goals on track. From there, Schwab Intelligent Portfolios builds your custom allocation using a variety of low-cost ETFs.

Schwab Intelligent Portfolio: Mobile app

Schwab Intelligent Portfolios also requires investors to have a certain cash allocation in an FDIC-insured account for all portfolios. Schwab Intelligent Portfolios is a strong option for hands-off investors seeking automated portfolio management with no advisory fees. And if you’re looking for a similar zero-annual fee platform without a big cash allocation, take a look at SoFi Automated Investing, which charges no management fee and also gives you access to financial advisors. For new investors who can meet the high minimum balance of $5,000 and want a simple, low-cost robo-advisor experience, Schwab Intelligent Portfolios is worth a look, as it charges no annual management fee for a basic account. The basic account charges no annual management fee, and there’s a decently priced premium account that gives access to financial advisors. This is a significant advantage over traditional financial advisors, who typically charge fees based on a percentage of assets under management (AUM).

The portfolios are the same as the free offering, but they are robust and include up to 20 asset classes. While the service doesn’t initially pair clients with a dedicated advisor, clients can request to work with the same advisor. At Schwab, the service is only available to clients who opt into the feature and have a minimum of $50,000 in their taxable account. It’s particularly valuable for investors in higher income tax brackets. It’s a complicated task of selling loser investments in a taxable account to offset taxes on any gains.

For Premium clients, another disadvantage is that you lose access to the plan if your collective account balances drop below $25,000. This has the potential to lower your overall yield, particularly if you currently prefer an aggressive investment strategy. Sign up to get a referral link and if someone uses it to open a new Schwab account, they’ll receive a $100 deposit into their account within a month. Finally, Schwab offers a referral bonus to your friends or family if you refer them and they open an account.

Schwab Intelligent Portfolios Standard vs Schwab Intelligent Portfolios Premium

All advisors are CFPs and are available by phone and video conference Monday through Saturday with day and evening availability. Unlimited access to a team of advisors (clients can request to work with the same advisor). Account management, planning or subscription fee Check out our roundup of the best wealth advisors

It automatically handles rebalancing, reinvestment, and tax-loss harvesting (for accounts over $50,000), all with no advisory fees. These are drastically higher than the annual management fees for similar high-balance, premium accounts at competitors like Betterment (0.40%). A premium account with a $25,000 balance, for example, would be charged an annual fee of $660 in year one—the $300 setup fee and management fees of $360.