SoFi Wealth Review 2023

SoFi, or "Social Finance Inc.", is a US-based fintech startup founded in 2011. It was first specialized in offering student loan refinancing but later has expanded into the broker and robo-advisory space. SoFi Automated Investing is SoFi’s fully-owned robo-advisory service (Automated Investing). It is regulated by top-tier regulators such as the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Besides SoFi Automated Investing, SoFi has a zero-commission brokerage service, SoFi Invest.

SoFi Automated Investing is recommended for US customers looking for zero-commission service with advisory support and ultra-low initial deposit requirement.

Pros

• Zero-commission robo-advisory service

• Fast and reliable customer service

• Easy and fully digital account opening with $1 required minimum deposit

Cons

• Limited options for portfolio personalization

• Only bank transfer is available for deposit and withdrawal

• Available only in the US

SoFi Automated INvesting charges no commission, which is great. There are no deposit and withdrawal fees, either.

Which fees should you take into account for robo-advisors? Here is a summary of the relevant fees:

Personal advisory services, when the robo-advisor's experts advise on how to allocate assets, have higher Robo-Service fee.

We compared SoFi Automated Investing's fees with those of two similar robo-advisors, Betterment and Wealthsimple. This selection is based on factors like products offered, client profile, fee structure, etc.

Let's start with the investment fees.

Investment fees 

For the better comparison of robo-advisors' Robo-Service and other investment fees, we calculated two benchmark fees, an annual fee for both basic and premium services. Robo-advisors usually offer multiple tiers of services, which differ in fees, minimum investment, and personal advisory.

• Basic service usually includes discount or zero fees, low minimum investment, and limited personal advisory services.

• Premium service usually includes higher fees, higher minimum investment, and an option for personal advisory.

We calculated the benchmark fees using $30,000 account balance for basic and $100,000 for premium accounts.  

SoFi Automated Investing's basic service is free. Premium service is not provided. 

It's unique that SoFi Automated Investing doesn't charge any Robo-Service fee and all fees for investing in ETFs are covered.

Non-investment fees

SoFi Automated Investing has low non-investment fees. It has no account, deposit, or withdrawal fees, similarly to its competitors.

SoFi Automated Investing has a fast and fully-digital account opening process. The minimum investment amount is $1. On the flip side, SoFi is available only in the US. 

Who can open an account?

SoFi Automated Investing is available only for US residents.

Minimum investment amount

SoFi Automated Investing's minimum investment amount is $1. It’s suitable for clients, who prefer investing lower amounts.

Account types

SoFi Automated Investing offers the following account types:

In this review, we tested the Individual Investment Account called Automated Investing.

How to open an account

Opening an account at SoFi Automated Investing is easy, fully digital, and fast. Our account was verified within one business day.

Nine steps of opening an account at SoFi Automated Investing:

1. Register a SoFi account, where you give your name, email address and a password
2. Accept the terms and conditions
3. Select your main savings goal: general investing, emergency fund or retirement
4. Add financial goals: how much funds you have now, what is your target and your total annual income
5. Choose between 5 pre-set risk levels
6. Select your account type (individual or joint) and state whether it is a retirement purpose account or not 
7. Add personal information: address, phone number, and employment status
8. Give personal data: address, Social Security Number or other ID details, regulatory financial data
9. Choose your funding method via linking your bank account

SoFi Automated Investing doesn't charge fees for withdrawals or deposits, and the whole process is easy and convenient. On the negative side, you can use only bank transfer, and only USD base currency is available for investing. 

Account base currencies 

SoFi Automated Investing offers only USD as an account base currency, which is not surprising, given the fact the broker serves US-based customers. It is the same at Betterment, while Wealthsimple has a wider offer.

Why does this matter? If you fund your robo account in the same currency as your bank account, you won't be charged a currency conversion fee. 

A convenient way to save on the currency conversion fees can be to open a multi-currency bank account. Revolut or Transferwise both offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. The account opening only takes a few minutes on your phone.

Deposit fees and options

SoFi Automated Investing does not charge deposit fees and supports automatic deposits. However, you can only use bank transfer, no electronic wallets or credit/debit cards are accepted.

Keep in mind, that a bank transfer can take several days.

Withdrawal fees and options 

SoFi Automated Investing doesn't charge withdrawal fees, however, withdrawals are only available through bank transfers. It’s the same for Wealthsimple’s competitors.

You have to remember that fund withdrawals with robo-advisors take a long time, around 6-7 business days. SoFi Automated Investing settles withdrawals within two business days after the trades occur, but you need to calculate with several business days for transferring the fund to your bank account. 

SoFi Automated Investing offers its services through web and mobile platforms. The investment platforms have clear structure and user-friendly layouts. Both are providing two-step authentication. On the downside,  portfolio reports are limited.

SoFi Automated Investing offers in-house developed web and mobile investment platforms. They are available in English.

Web investment platform ★★★★☆

SoFi Automated Investing's web investment platform is user-friendly and easy-to-use. Adding a portfolio is easy, just add a new "Automated Investing" plan, while you can select the details (ie risk level, duration, etc.) with just a few clicks.

The design is simple and straightforward, the branding and marketing intentionally target minimalism. 

SoFi Automated Investing provides a two-step login. You can turn it off and on under your profile name, in the "My profile" menu in "Account settings".

When it comes to the portfolio report, SoFi Automated Investing can be improved. There is no chart or any detailed breakdown for portfolio performance, only a percentage of the returns. You can't expect a clear fee report, because SoFi Automated Investing doesn't charge fees.

Mobile investment platform ★★★★☆

SoFi Automated Investing's mobile trading platform is available both on iOS or Android devices. In this review, we tested it on iOS.

The mobile investment platform is considered to be a perfect copy of the web investment platform, as in it’s user-friendly with minimalist design, offers a two-step authentication process, and the portfolio report is basic.

SoFi Automated Investing has limited options for investment portfolio personalization. It doesn't offer extra features, like socially responsible investing or tax-loss harvesting. As a plus, you can easily set your risk preferences. 

If you compare the robo-advisors, you should concentrate on the following three questions:

• Personalization: how can you personalize your investment preferences and how many model portfolios can you choose from?
• Asset allocation: what is the distribution of the assets the robo-advisor invests in?
• Extra features: can you benefit from extra services, like an option for socially responsible investing or tax-harvesting?

Let's see the answers for SoFi Automated Investing.

Personalization

When you start investing with a robo-advisor, you can usually add your investment goal, risk preference, investment time horizon and target amount. Based on your inputs, the robo-advisor recommends one of their model portfolios and you can decide, which one you want to go with. The robo-advisors differ in the depth of personalization and the number of available model portfolios.

SoFi Automated Investing offers only 10 model portfolios and the level of personalization is average. 

The first step of adding a new investment portfolio is to add your investment goals and to choose between taxable and retirement accounts. After that, you can choose from five different risk levels, ranging from Conservative to Aggressive.

Product range 

SoFi Automated Investing invests mainly in big US-based ETFs, like Vanguard, Blackrock series, and SoFi's own ETFs.

The asset allocation within the portfolios is changing in line with your risk preferences.

SoFi Automated Investing's Asset Allocations According to Strategy

Additional Features

SoFi Automated Investing doesn't offer additional services, like tax-loss harvesting or socially responsible investing. These features would be a big plus.

SoFi Automated Investing has great customer support. You'll get fast and relevant answers.

You can contact SoFi Automated Investing via:

• Phone: we reached the agent within a couple of minutes by walking through a meaningful multi-choice menu and we got relevant answers
• Chat: after your identification, it works fast and provides relevant answers

Unfortunately, customer service is not 24/7. You can contact them between 4:00 am to 9:00 pm PT

SoFi Automated Investing is regulated by top tier financial authorities SEC and FINRA. You are also protected by a high investor protection limit of $500,000, which includes a $250,000 limit for cash.

Is SoFi Automated Investing regulated? Yes, it is regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Is Sofi Automated Investing safe? To be sure, it is best to check two things: the background of the robo-advisor, and how you are protected.

How are you protected?

This is important because the amount of investor protection differs from regulator to regulator. This is not an issue in this case, as all the customers are covered by SoFi Securities LLC and the US investor protection scheme, called SIPC (Securities Investor Protection Corporation). 

The SIPC investor protection scheme protects against the loss of cash and securities in case the broker goes bust. The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash. This amount is substantially higher than the amount most investor protection schemes provide.

Background 

SoFi Automated Investing's parent company SoFi was established in 2011. The longer the track record of any company, the more proof we have that it has successfully survived previous financial crises. 

Being regulated by top-tier regulators and offering a high level of investor protection are all great signs for SoFi Automated Investing's safety.

SoFi Automated Investing is a robo-advisor based in the US. 

SoFi Automated Investing offers free robo-advisory service with no deposit and withdrawal fees. The customer service is fast and reliable, and the account opening is fully digital and easy. 

There are some drawbacks though, the personalization of investment portfolios is very limited. You can use only bank transfer for money transfers and the service is only available for US residents. 

As it is easy to open an account, the fees are low and their customer service is fast, feel free to try SoFi Automated Investing.