SoFi Automated Investing Review: Low Costs and More

SoFi (named for "social finance") quickly became known for its customer-centric approach to lending. Now it's making a splash with its impressive SoFi Invest platform.

The SoFi Invest platform lets customers invest in stocks, mutual funds, and ETFs. For investors who prefer to keep investments on autopilot, SoFi offers automated investing.

In this SoFi Automated Investing review, we'll take a deeper dive into the robo-advisor platform and look at the pros and cons to help you decide whether it's right for you.

One of our favorite robo-advisors

SoFi Automated Investing is one of our favorite robo-advisors. It ranks among the best we've seen in these categories:

This robo-advisor is a good fit for: Passive investors seeking a low-cost robo-advisor that offers the best of both worlds: automated investing and access to human advisors.

Top perks

Low costs

SoFi Automated Investing is one of the best robo-advisors for low costs. The company charges no management fee and has no account minimum -- investors can put their money to work with as little as $1. However, note that the underlying investment funds may come with their own fees.

There are also no fees for money transfers, and you won't pay anything to set up or maintain your account. If you use SoFi's invest platform for active investing (for example, to buy a specific stock), you won't pay any trading commissions.

Support for retirement accounts

SoFi Automated Investing supports individual and joint accounts, as well as traditional, Roth, and SEP IRAs.

Access to human advisors

Few robo-advisors offer access to a human financial advisor, and those that do tend to limit access. SoFi Automated Investing customers get unlimited access to financial advisors. All of SoFi's investment specialists are Certified Financial Planners and are bound to the fiduciary standard, which means they won't attempt to sell you products simply for a high commission but instead are required to put your best financial interests first.

Automatic rebalancing

SoFi automatically adjusts your investments over time to make sure your portfolio has a good balance of risk and return, based on your financial goals.

Online and mobile experience

SoFi's simple-to-use online and mobile apps are standout features. Notably, its iOS and Android apps are highly rated.

The apps let you access all SoFi products, which means you could manage your banking, investing, and lending all in one place if you take full advantage of a SoFi membership.

Discounts on other SoFi products

SoFi customers who maintain a minimum balance of $10,000 in their SoFi Invest accounts or who already have a loan with the company get interest rate discounts on other SoFi products, such as personal loans. Qualifying members also get access to SoFi member events.

What could be improved

No tax-loss harvesting

Tax-loss harvesting is a strategy where you (or your broker) sell certain investments that are losing value with the goal of offsetting taxable gains across your portfolio. This reduces the amount of tax you owe on your investment gains.

SoFi doesn't offer tax-loss harvesting service, a potentially major drawback for investors with large accounts or who are otherwise in high tax brackets and want to reduce their tax bill.

In addition to standard brokerage accounts, SoFi Automated Investing offers IRAs (traditional and Roth), SEP-IRAs, and lets members roll over existing retirement funds from a 401(k) or similar plan into a SoFi account. Members can access accounts through SoFi's online portal or through its user-friendly mobile app.

SoFi Automated Investing customers can choose from several investment portfolios offering a variety of risk levels and investment goals. If you aren't sure which one to choose, don't worry -- you can answer questions about your financial goals, current assets, and income, and SoFi will do the rest.

As with most robo-advisors, the portfolios are composed of exchange-traded funds (ETFs) that put your money into a mix of stocks, bonds, and other asset classes. Unlike many competitors, SoFi uses some of its own ETFs in its Automated Investing portfolios, which is another way it keeps expenses low.

Learn more: How to automate your investments

Services offered

SoFi Automated Investing offers automatic rebalancing, which means it automatically adjusts your investments on a regular basis to maintain your desired risk level and investment goals. For example, if your portfolio contains a 50% stock and 50% bond mix, and the stock market rises dramatically, the value in your portfolio might be tipped toward 60% stock and 40% bond. SoFi automatically adjusts your investments by selling some stocks and buying some bonds to regain the 50/50 mix.

SoFi members also have access to a high-interest savings account, which pays an APY on cash balances, which varies over time and rivals some of the best online savings accounts. There is also a fully online checking account available, as well as a variety of other banking products and services offered by SoFi.

SoFi is well-known for its outside-the-box approach to financial services. SoFi Automated Investing clients who invest at least $20 per month get access to some unique and valuable perks, such as free career coaching, in-person member events, and discounts on SoFi lending products.

Pricing and fees

SoFi Automated Investing is among the cheapest robo-advisor platforms. You'll pay no account management fees and minimal investment expenses on the underlying ETFs in your portfolio, so you keep more of your returns than you would with many of SoFi's competitors.

There are two types of support clients of a robo-advisor could need: investment advice and help with technical issues. We already mentioned that SoFi customers get unlimited access to human financial advisors, and you can schedule appointments via phone or video call. SoFi's advisors can't advise on the purchase of specific securities, but can offer guidance on your overall financial goals. You can reach a financial advisor by logging into your account in the app or online.

For technical support, you can access a SoFi Invest rep via email anytime or via online chat or phone Monday through Thursday 5 a.m. to 5 p.m. PST, and. To reach support via phone, call (855) 525-SOFI (7634).

• You want an automatic investment service with a bare minimum of expenses.
• You want access to a human financial advisor.
• You're already a SoFi lending or banking customer or are considering taking out a loan.
• You aren't too concerned with tax strategies on your investments.
• You're a newer investor with little upfront capital to contribute.

At The Motley Fool Ascent, brokerages are rated on a scale of one to five stars. We primarily focus on fees, available assets, and account types; however, we also take into account features like research, education, tax-loss harvesting, and highly rated mobile apps. Our highest-rated brokerages generally include low fees, a diverse range of assets and account types, and useful platform features.

See our full methodology here: Ratings Methodology