Ally Invest Robo Portfolios review: Automated ETF portfolios with no fees

Ally Invest Robo Portfolios is best for hands-off investors in search of automated portfolio management. Ally Invest; Alyssa Powell/Insider

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Bottom line: Ally Invest Robo Portfolios is ideal for hands-off investors in search of automated ETF portfolios without fees. However, it isn't a good option for those in search of tax optimization features like tax-loss harvesting, and you'll want to look elsewhere if you'd like to utilize one-on-one advisor guidance.

Ally Invest Robo Portfolios

4.56/5

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Ally Invest Robo Portfolios from Ally Invest

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On Ally Invest's website

Investment Details

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Editor's Rating

4.56/5

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Pros & Cons

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Overall rating

Is Ally Invest Robo Portfolios right for you?

Ally Invest Robo Portfolios is an Ally Financial-affiliated automated account offering investing without fees for US residents. Ally Invest Advisors, Inc. manages the account and is in turn a subsidiary of Ally Invest Group, Inc. Ally Financial Inc. owns Ally Invest Group.

It's a great option for existing Ally users as it allows for easy account integration with both banking products and investment accounts. The robo-advisor supports IRAs, as well as individual, joint, and custodial investing accounts. One drawback, though, is that it doesn't offer human advisor access.

The Ally Invest mobile app is available on iOS and Android devices.

Ally Invest Robo Portfolios vs. Fidelity

If you're a hands-off investor in search of automated portfolio management, Ally Invest Robo Portfolios and Fidelity Go are both popular platforms. But the investment apps have a few differences when it comes to fees and investment choices.

For instance, you won't need a minimum account size to use Fidelity's automated account, but you'll have to pay an advisory fee if you have a balance greater than $10,000. You'll need at least $100 to use Ally's equivalent account, but you'll never have to worry about fees.

Ally Invest Robo Portfolios vs. Schwab Intelligent Portfolios

Ally Invest Robo Portfolios and Charles Schwab's most basic automated account, Schwab Intelligent Portfolios, both offer competitive automated investing services. Schwab Intelligent Portfolios has a higher minimum ($5,000), but like Ally's account, you can also avoid annual fees.

Both also offer multiple portfolio options, but Schwab is supports more account types. Ally currently supports IRAs and individual, joint, custodial accounts. Schwab, on the other hand, is compatible with individual and joint accounts, trusts, custodial accounts, and IRAs (Schwab accepts traditional, Roth, SEP, SIMPLE, and rollover IRAs).

Ways to invest with Ally Invest Robo Portfolios

Automated portfolios

You'll only need $100 to get started. The account also has no advisory fees, and it sets aside 30% of your cash (Ally Invest also lets the cash grow at a variable interest rate) to protect you against market risk.

Another thing to point out is that this account relies on both automated technology and human oversight. It lets you choose between four different portfolios:

• Core: Ally Invest says it diversifies your portfolio across domestic, international, and fixed-income assets with this option. Risk levels range from conservative to aggressive, so you can choose the level that best aligns with your investment goals.
• Income: The automated account offers this portfolio for investors near or in retirement. Ally Invest says this option provides both higher dividend yields and a conservative risk level.
• Tax-optimized: This portfolio is best for those in higher tax brackets, according to Ally. It strives to maximize your returns by investing in low-cost, tax-advantaged ETFs.
• Socially responsible: As the name implies, this portfolio focuses on investing in ETFs of companies that regularly engage in ethical practices regarding the environment and sustainability.

This automated account is compatible with IRAs and individual, joint, custodial accounts.

Account setup and user interface

Ally Invest Robo Portfolios takes you through a few quick steps when first setting up an account. You choose your goals (Ally's available goals include Retirement, Major Purchase, Generate Income, and Building Wealth), set your time horizon, liquid assets, and initial investment.

After that, you choose how much risk you're comfortable with and your desired portfolio type, and Ally offers a personalized recommendation.

For instance, let's say you selected Building Wealth as a goal, picked a time horizon of five years or less, and inputted $10,000 as your liquid assets and $500 as an initial investment. If you selected the "high" risk level, and picked the Core portfolio type, Ally would offer the following recommendation:

Ally Invest

After providing a portfolio recommendation, Ally gives you the option to open a new account or make changes to your preferences.

Ally Invest: Is it trustworthy?

Ally Invest currently has a B rating with the Better Business Bureau. The bureau attributes this rating to the fact that Ally Invest received 74 complaints within the last three years.

The bureau's ratings reflect its opinion of how well a company interacts with its clients. When evaluating businesses, the BBB also considers type of business, time in business, customer complaint history, licensing and government actions, and more.

However, these ratings don't guarantee that a company will exhibit a high level of reliability or performance. This is why it's always important to do your own research in addition to the BBB's findings.

Ally Invest has closed nearly 20 complaints in the last 12 months.

Ally Invest Robo Portfolios — Frequently asked questions (FAQ)

Related terms

• Index funds: Some mutual funds and ETFs track certain market indexes (i.e., the S&P 500) and aim to mirror their performance. For example, total stock market index funds generally aim to grant your portfolio access to the complete US stock market.
• ETFs: Containing a blend of different assets like stocks, bonds, and commodities, ETFs also trade like stocks; that is, you can easily trade them at any point during the stock exchange's hours. However, they're less risky than stocks since your risk is spread across multiple assets, as opposed to just one security.
• Brokerage account: These accounts connect you to major stock exchanges and let you trade a range of investments, including stocks, ETFs, mutual funds, bonds, and more.
• Robo-advisor: Also known as automated investing accounts, robo-advisors rely on computer algorithms and/or expert oversight to build personalized portfolios for retail investors.