If you had a million dollars, would you let a robot do the investing for you?
You probably wouldn’t. But that’s the direction companies are taking, including Vanguard.
When you invest a single penny of your hard-earned money, you need to think about it as if it were a million dollars. That’s the mindset you want to have at all times when you invest.
There is NO SUCH THING as a “small loss,” or money that doesn’t matter because “it’s too small to worry about.”
Once you get into the mindset of growing your money, you become a serious investor and not a speculator. Leaving this work to a robot will always leave out the most important ingredient: YOU.
To me, they’re putting the cart before the horse. At the heart of the matter is, will you listen? Will you listen and act on a recommendation from an algorithm? Will you trust a recommendation that will impact your family’s wealth?
The robos save money on phone reps, have a big marketing spend, and a neat looking website.
But what if there’s a problem? A few years ago, when stocks were down 1,600 points, Bloomberg reported that the websites of robe-advisers Wealthfront Inc. and Betterment crashed. This is one of the MANY reasons robo-advisors will NEVER work for investors–NEVER. What a SHAM.
Also, it’s been my experience that investors want regular conversations about their savings, especially when they’ve made money over a lifetime and it would take another one to replace the losses.
If you’ve worked your whole life to save, and a robo-advisor lost your money, how could you expect to make back what’s gone? The arithmetic is not on your side.
Originally posted on Your Survival Guy.