Investing > Best Robo-Advisor
In March 2019, Schwab became the first large financial services firm to introduce subscription-based financial planning with Schwab Intelligent Portfolios Premium. The Wall Street Journal said Schwab’s model “should send a shock wave through the marketplace” and called it “a radical break from business as usual,” likening it to brands like Spotify and Netflix. Within three months of launch, the service attracted $1 billion in new assets and saw rapid account and average investment amount growth.
For an upfront $300 planning fee and $30 monthly subscription, Schwab Intelligent Portfolios Premium builds customers a fully automated, diversified investment portfolio with:
• Unlimited 1:1 guidance from a team of CERTIFIED FINANCIAL PLANNER™ professionals to help with planning for expenses, college, wedding, children, retirement, or any milestone
• A comprehensive financial plan with customized roadmap around financial goals
• Ability to access the financial plan 24/7 via a comprehensive digital planning experience, with the ability to modify assumptions in real time to see impact on a client’s overall financial picture and help them stay on track
A subscription pricing approach offers significant value to investors – as their investments grow over time, the cost of guidance doesn’t increase as it would in the asset-based fee model common in the industry.
Subscription pricing for financial planning can radically change the way people invest by making it more accessible and affordable to access planning and professional guidance. With an investment minimum of just $25,000, Schwab’s financial planning service is more accessible than similar offers, compared to as much as $50,000 to $100,000 at other roboadvisors or $1 million or more at many Wall Street firms.
Schwab Intelligent Portfolios Premium is part of Schwab’s digital advisory services, which manage $41 billion in assets (up 23% year-over-year, as of June 30, 2019) and serve approximately 340,000 accounts.