Ellevest Review – Robo Investing for Women
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Can you earn more money by actively investing in the stock market on your own? Sure — if you know what you’re doing and have the time — but if not, I highly recommend giving Ellevest a try.
8.5/10
Cost
8.5/10
Features
8.5/10
Ease of use
9/10
Services
8/10
I remember half-listening to a financial advisor visiting my first full-time job nearly a decade ago, stressing the importance of long-term investing and retirement planning. But as a 24-year-old barely making enough to pay her bills, building a retirement fund and investing portfolio were far from my mind.
“I’ll do that when I’m older,” I thought — a thought many young people have. It’s a catch-22 because investing earlier is the best way to grow wealth. But it’s often when you’re older, earning more, and beginning to realize retirement isn’t so far away that you realize the importance of growing your money.
That’s when I stumbled upon Ellevest, a unique robo-advisor platform tailored to women’s investing and retirement needs.
In this article
What is Ellevest?
Ellevest is an innovative, socially conscious robo-advisor designed by and for women. It’s no secret that women tend to live longer than men, and yet, women tend to retire with only two-thirds the amount of money as men. Women also make less than men, on average, and that’s especially true for women of color.
Ellevest realized that to obtain financial security after retirement, women needed to change how they were investing their money. That’s why, in 2014, Ellevest officially launched its investing platform, which offers various financial services geared toward women.
Not only does this investing software focus on meeting women investors’ needs, but it also supports social change by encouraging users to invest in female-fronted companies. (Ellevest is not exclusive to women; men are also encouraged to open an account.)
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My experience using Ellevest
Before becoming an Ellevest member, I realized that I needed to get serious about my retirement planning. I had an old 401k from a former employer floating around (don’t worry, it’s being rolled over into an existing account) and a Roth IRA for my current employer, but I wanted other options.
Full disclosure: I’m still a fairly new Ellevest user. However, after a few months of paying attention to the data and reviewing Ellevet’s projections vs. expectations, I’m excited to keep building wealth for my future using an app focused on social justice and women’s issues.
I have two retirement accounts set up and one investing portfolio. I do have an outside Roth IRA with my employer, but I also wanted to open a Traditional IRA.
I have not set up banking through Ellevest and am unsure if I will. While their banking services are on par with many online banks, I have an and am very happy. (It provides higher interest rates than most banks.) I might end up using these services in the future, but I’m not in a rush right now.
I’ll walk you through my experience setting up and using Ellevest.
Getting started with Ellevest investing
After getting burned out by actively investing, I was eager to work with a robo-advisor focused on long-term growth so I could check in on my investments less often and adjust accordingly.
To get started with Ellevest’s investing accounts, you’ll create a Build Wealth Account. As you start to set this account up, you’ll need to decide what type of portfolio you want to invest in. Ellevest offers two types of portfolios to choose from:
- Ellevest Core Portfolio - offers a diversified selection of three asset classes: stocks, bonds, and mutual funds customized to your financial needs, with a 70% chance of success.
- Ellevest Impact Portfolio - offers a diversified selection of three asset classes: stocks, bonds, and mutual funds that support female-led companies, sustainable and ethically responsible companies, and businesses dedicated to community development, with a 70% chance of success.
It’s important to pick the right account from the start. Otherwise, you might owe capital gains tax if you switch later on.
From there, you’ll set an investing goal (x amount in x years), and Ellevest will recommend how much you should deposit monthly to meet this goal. Depending on your financial needs, You can adjust that number up or down, and Ellevest will automatically adjust your projection.
You’ll also be able to link your bank account directly to your Ellevest account to transfer money immediately and set up recurring transfers. There’s no minimum investment and no minimum account balance required.
If you have an Ellevest bank account, you can set up savings rules to automatically move money from these accounts every time you round up or on a specific day each month.
Here’s an example of a Core Portfolio account I opened.
You can also decide whether to invest more aggressively or conservatively at Ellevest’s recommended rate. I chose the middle option because I want to be safe, yet with my age, I don't have to be too conservative.
You can also look closer at your portfolio mix and asset allocation to learn more about each stock, fund, and bond you’re investing in. The Core Portfolio was a perfect choice since I was looking to invest in a mix of Vanguard ETFs.
It’s also easy to adjust your goals with just a few clicks (or taps if you’re using the mobile app). You can change your monthly deposit to recalculate your goal amount, change your years until retirement, add one-time deposits, or adjust your goal amount to get monthly recommendations.
Ellevest will tell you whether or not you’re on track and offer investment advice to get you back on track if you’ve fallen short of your goal.
Since this is a new account, I haven’t invested too aggressively but will be looking to increase my monthly deposit from $200 to $750. Let’s look at how this will change my projected long-term investment.
By increasing my monthly deposit to $750 a month, Ellevest predicts I’ll earn over $1 million in investments by the time I reach retirement age. This is a huge jump from the $99k I was on track to earn by depositing $200 per month. Is $750 a stretch versus $200? Of course, it is, but this is important when I can see I'll have a million by retirement versus less than $100,000.
But it’s also easy to decrease your contributions, so I can cut back if money gets too tight.
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Getting started with Ellevest retirement
While I was very interested in investing with Ellevest, I focused primarily on retirement goals. I have an outside IRA through my employer, and I love that Ellevest allowed me to factor that amount into my goals to give me a more accurate picture of how my monthly contributions would help me meet my retirement goals.
After answering a few questions (like how much money I hoped to have per year and when I expected to retire), Ellevest recommended I open an Ellevest Investment Account and Roth IRA. Again, Ellevest’s forecast calculator allows you to see better how your money will grow over time and whether or not you’re on track to meet your retirement goals.
Ellevest also provides a convenient snapshot of how much money you’ll likely have per year once you reach retirement age.
You can set a target and adjust as needed, pausing, reducing, or increasing your payments anytime.
How much do you need to start?
Like many new robo advisors targeting new investors, you don't need much to invest. You can start with just $1 if you'd like.
A perk for robo advisors is not charging you investment fees – we already have limited funds, right? Ellevest doesn't charge fees; it's included with membership, which is $12 per month.
Ellevest features
This female-focused investing platform has a few different products you can enroll in and different member tiers.
Investing
Ellevest’s primary service is long-term investing. When you sign up, you’ll be prompted to answer a few questions, including your age, zip code, gender, and degree level. From there, Ellevest will recommend an investment portfolio composed of stock ETFs, bonds, and alternative funds. The way Ellevest diversifies your specific portfolio is designed to help you minimize your risk.
Retirement planning
Whether you already have a retirement plan or know you need to start saving, Ellevest can recommend the right retirement portfolio for your age and financial goals. Ellevest will also consider any money you already have in outside accounts before recommending a traditional, Roth, or SEP IRA.
Banking
Another feature that Ellevest offers is checking and savings accounts. The Ellevest debit card is linked to your Ellevest Spend account and earns you 5% back when you shop for qualifying brands and stores It allows you to round up your spare change so it automatically transfers into your Ellevest Save account. Ellevest’s banking accounts have no minimum balance fees, transfer fees, overdraft fees, and ATM fee reimbursement guarantees.
Financial coaching
Lastly, Ellevest provides one-on-one coaching with qualified female financial advisors to answer your questions or help you build a roadmap to financial freedom. You won’t just get advice and generic answers during these sessions — you’ll actually leave with an actionable financial planning guide designed to help you meet your goals.
Ellevest pros and cons
Pros
- Low-cost, transparent monthly fees. I love that the platform did away with its fee-structure and now Ellevest charges a monthly membership price of $12 per month for investing services, which is a price tag most of us can get behind. There are also no balance requirements, no monthly investment plan minimums, and no management fees.
- Sleek digital interface. I’m a big fan of Ellevest’s digital app and online platform displays. Both tools offer similar services, but the app looks a little bit cleaner and gives you a better overview of how your accounts are doing. You do have a little bit more control over your account from a desktop, though. (For instance, I needed to add an outside IRA to my retirement account and could not do that from the mobile app.) Ellevest’s forecasting charts are easy to read and offer quick insight into your account’s health, so you don’t have to dig into individual stock performances.
- Goal-setting features. When you open an investment or retirement account through Ellevest, you can personally set long-term or short-term goals. Ellevest allows you to determine how much money you need to have by a particular age and offers suggestions for how much to deposit per month. If that amount is higher than you can afford, you can easily adjust it and update your goal to either stretch out for another year or two or minimize your total savings goal. It’s easy to spin these goals up or down at any time, and viewing your projections can really motivate you to increase the amount you’re investing.
- Robust educational resources and coaching options. Members have full access to learning resources through Ellevest, including workshops, video sessions, articles, and additional investment strategy guides, tools, and tips. Ellevest really encourages their users to learn as much as they can about their own finances so they can make smarter savings and investing decisions. One-on-one coaching is also a helpful service that Ellevest provides, though you will pay extra for these sessions.
- Hands off-investing. My favorite part about Ellevest is that I can set up a portfolio and let it work it’s magic long-term, while I focus on other savings goals. Ellevest offers rebalancing services automatically, adjusting your portfolio over time to stand up against market changes and trends.
Cons
- Limited portfolio options. Ellevest offers only two portfolio options, Impact and Core, with the option of increasing or decreasing your investing risk (and potential reward). However, if you want to invest in a stock you’re hearing a lot of buzz about, like Tesla or Zoom, Ellevest isn’t the right platform. Your money will be placed in ETFs, bonds, and funds, where you’ll own partial shares in stocks, in order to minimize your risk. However, you cannot pick and choose specific companies to invest in or avoid.
- Low savings rates. One of the reasons why I haven’t yet opened an Ellevest banking account is because they don’t offer interest rates on their savings accounts. While their checking account has some innovative features, their savings account isn’t very notable. It’s not technically free (since you’re paying a membership fee) and it’s easy to find high-yield savings accounts with interest rates from 0.50% to 1%. I use Ally Bank instead.
- Access to certified financial planners cost extra. It’s great that Ellevest allows you to connect with real-life financial advisors, but none of the three tiers of membership allow you to do so for free. You’ll need to purchase this session ala carte, though you will save a percentage on the cost depending on your membership level. It would be nice to offer at least one free service as a signup bonus.
Ellevest vs. competitors
I reviewed two similar services before ultimately settling on Ellevest — Betterment and Wealthfront. These robo-advisors are top competitors in the space and are more well-known than Ellevest.
Betterment
Betterment charges a 0.25% fee for its digital investing plan and a 0.40% fee for premium investing. Unlike Ellevest, they offer tax-saving strategies such as tax-loss harvesting, though Ellevest does work to minimize taxable events that would trigger capital gains taxes and other situations. Betterment also offers a savings account earning 0.40% APY, which is much better than Ellevest’s.
On the downside, Betterment’s premium investing account requires a $100,000 minimum balance, though it does gain you unlimited access to financial professionals.
Robinhood
Robinhood is a free trading platform that offers full and fractional shares. Instead of buying one full share of stock, you can buy a fraction of an equity stock for as little as $1.
A minimum deposit isn’t needed to open an account. Even with only a few dollars, you can invest through Robinhood with zero-commission trades.
FAQs
How does Ellevest work?
Ellevest uses an algorithm that takes into account gender-specific factors like pay gaps, career breaks, and lifespan. It creates personalized investment portfolios based on the user's financial goals, timeline, and risk tolerance.
What services does Ellevest offer?
Ellevest offers a range of services including personalized investment portfolios, retirement planning, a no-fee debit card, and banking services. It also provides access to financial advisors and career coaching for an additional fee.
Is Ellevest only for women?
While Ellevest is designed with women in mind, addressing issues like the gender pay gap and longer lifespans, it is open to anyone regardless of gender who wishes to use its services.
How does Ellevest differ from traditional investment platforms?
Ellevest's unique approach focuses on women's financial realities. It offers goal-based investing, where users can set specific financial goals, and its algorithm adjusts for gender-specific variables.
What are the fees associated with Ellevest?
Ellevest charges a percentage of the assets under management as its fee. This fee structure varies based on the plan chosen. There might be additional fees for extra services like access to financial advisors.
How can someone start investing with Ellevest?
To start investing with Ellevest, one needs to create an account on their website or app, complete a profile with financial information and goals, and choose an investment plan. The platform then creates a customized investment portfolio.
Is Ellevest safe and regulated?
Ellevest is a registered investment advisor with the U.S. Securities and Exchange Commission (SEC). It uses standard security measures and protocols to protect clients' personal and financial information.
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- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
The bottom line
Ellevest is quickly becoming a premier social impact investing platform geared specifically towards women and their financial goals. Ellevest is designed to take women’s pay differences, long gaps in employment, and longer lifespans into account when customizing a retirement and investment portfolio. It’s a great platform to start investing with and ideal for beginners and those looking to fund additional retirement savings.
Can you earn more money by actively investing in the stock market? Sure — if you know what you’re doing and have the time — but if not, I highly recommend trying Ellevest.
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Writer
Courtney Johnston is a freelance writer, specializing in finance, travel, and health. She has written for The Chicago Tribune, Benzinga, BestReviews, Mashvisor, Fundera, MoneyGeek, and The Culture Trip. She also teaches writing instruction at the University of Indianapolis. Courtney currently resides in Indianapolis.
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