Many refer to robo advice as the hottest personal finance trend of 2016, but contrary to popular belief a robot will not be managing your money. Instead, robo advice is a simple way to manage your investments online, and this is why millions are turning to these digital wealth managers.
Investors turning to robo advice
When robo advice is discussed its usually with the millennial in mind. These 18-34 year olds who have grown up online are the obvious customers of a digital financial service. In fact, 80% of UK millennials have said they would trust a robo advisor which amounts to a whopping nine million people.1
According to a report a millennial investor is more likely to shop around and aren’t afraid of change. The millennial is 50% more likely to move their wealth around than their baby boomer (aged between 52 and 70) counterpart.2
But these services aren’t just for the millennial, the average age of a Moneyfarm customer is 38, and when so much of our everyday lives is performed online shouldn’t we be able to manage our wealth that way too?
When interest rates are at record lows, and under 2% of UK savings accounts offer flexible access and inflation beating returns,3 shouldn’t every generation be looking to make their money work harder?
Take control of your finances
What the robo advisor does fantastically well is to make the investor feel in control of their finances. At Moneyfarm there are no entry fees or exit fees, and the account is flexible, so if you need access to your money you can have it back in your bank account that week.
Whilst an investment carries higher risk than a cash savings account, and the value can go down as well as up, that risk is calculated based on the way you answer a set of questions, and a team of professionals manage your money for you. That leaves you, the investor, in complete control of your finances, but you don’t have to learn a lot about the financial markets.
As future generations grow their wealth we can expect an increase in demand for investment services with complete transparency, accessibility and the ability to make decisions anytime and anywhere. These services already exist, and at Moneyfarm we leave you more of your hard earned money to invest.
1 Young UK investors prove keen on robo-advice, FT Adviser
2 2016 Wealth Management Trends, PWC
3 Less than half of savings accounts beat inflation, Moneyfacts
