WiseBanyan is a micro-investing app which calls itself “the world’s first free financial advisor.”
Launched in 2014 and based in Las Vegas, Nevada, the platform offers zero-fee account management and goal-based planning tools. In 2018, Axos acquired WiseBanyon, the holding company for Axos Bank, a tech-driven financial services provider.
How WiseBanyan Works
Much like other robo-advisors, WiseBanyan invests your money in a diversified portfolio of ETFs, automatically managing dividends and rebalancing according to your choices. The service also supports partner accounts for joint savings and money management (although it does not link brokerage accounts), and you can invest in fractional shares. The platform’s “milestones” feature allows you to set up financial targets that will monitor, rebalance and automate deposits for goals such as a “Rainy Day” and “Retirement.”
WiseBanyan’s premium service allows you to invest in individual retirement accounts (IRAs), and it offers tax loss harvesting in the WiseHarvesting and Selective Trading products. These services have an annual fee of 0.24% of taxable assets up to $20 per month. WiseBanyan Portfolio Plus offers access to dozens of additional ETFs, and allows investors to choose from an expanded list of pre-existing portfolios or develop their own custom portfolios.
WiseBanyan Versus Competitors
WiseBanyan’s key draw is its zero management fee regardless of account balance. Comparatively, many rivals charge a fee of around 0.25% to 0.50% of assets under management. However, the company charges for some add-on services that other robo-advisors include in an all-in management fee. For example, it’s the tax-loss harvesting feature.
The platform is a nice route for investors seeking educational and goals-based planning tools. The interactive nature of the app and educational blog are very helpful.
For example, the free “Formulas” feature lets you take advantage of opportunities to deposit additional funds, such as choosing to match deposits to any dividends that your investments pay, or purchase extra shares if an investment drops in value by a predetermined amount.
For investors without the funds to buy shares of popular companies like Amazon.com Inc. and Apple Inc., its fractional shares allow them to invest their idle cash in places they couldn’t have otherwise.
How to Get Started
Anyone with a U.S. Social Security Number and a U.S. address is eligible to become a WiseBanyan client.
Once the company has verified your identity and you’ve created an account, you will answer several investing-related questions to determine risk aversion, time horizon and money saved. The quiz will rank your risk score from 1 to 10, with the option to adjust your score.
WiseBanyan will then allow you to sync to your bank account with a minimum starting deposit of $1 and an opportunity to set up automatic deposits. IRAs have a minimum account balance of $25. WiseBanyan says clients can also easily move outside investments such as old 401(k)s to the platform. Although, you’ll have to liquidate your holdings in your brokerage account because WiseBanyan is only able to receive cash assets.
Is WiseBanyan Free?
WiseBanyan doesn’t charge annual fees for its basic service, but charges investors annual fees for ETFs the platform recommends. The ETFs available in WiseBanyan’s Core Portfolios have an average fund fee of 0.12%, per the company’s website.
WiseBanyan’s premium package called Portfolio Plus costs $2 per month, with additional paid add-ons like tax-loss harvesting at an annual fee of 0.24% of taxable assets, or a maximum of $20 per month. The annual IRA fee is also 0.24%, and capped at $20 a month. There is also a $75 ACAT transfer out fee, a $10 IRA closing fee, and a $25 outgoing wire fee.
Is WiseBanyan Legit?
WiseBanyan is SIPC insured and registered with the financial regulatory agencies SEC and FINRA. Investments are held with Apex Clearing House.
Users on the Apple App Store rate the platform 4.6/5.0, based on 162 individual reviews. Rivals platforms like Wealthfront and Acorns have 4.9/5.0 and 4.7/5.0 ratings on the Apple App Store respectively.
Over 25,000 people use the app to save and invest over $5.5 billion in goals, according to Crunchbase. WiseBanyan raised $6.6 million in funding, and Axos bought them out.
WiseBanyan offers an attractive pricing model for new investors seeking basic portfolio management and goals-based guidance. Those seeking a wider range of account selection and other paid services like tax-loss harvesting and IRA management might want to weigh other options.
For more on how to save, read our Micro-Investing: What It Is, Why It’s for You and How to Start.