Investing, Stock Market

Wealthsimple Invest Review For 2022

Not everyone has the time and strength to take on the rigours of self-directed investing and trading in the financial markets. 

This is the reason why many investors prefer investment portfolios that are managed by Robo-advisors. 

With Robo-advisors, you don’t need to worry about analyzing the market and rebalancing your investment portfolios every time. All such activities will be done automatically for you at a relatively low fee.

A lot of Canadian investors are gradually shifting towards this hands-off approach to investing because it is convenient and affordable for many. 

Wealthsimple Invest is one of the leading platforms offering such Robo-advisor services in Canada right now. The platform is consistently gaining attention from beginners and experienced investors all over the country and it is worth looking into. 

This Wealthsimple Invest review discusses all the key features and advantages of the Robo-advisor platform. A section of this review also compares Wealthsimple Invest to some other popular Robo-Advisors in Canada.

With all that said already, let’s get into the details!

Wealthsimple Invest Review

What is Wealthsimple Invest?

It is a Robo-advisor platform offered by Wealthsimple Inc — a Canadian online investment management company founded in 2014.

The Wealthsimple Invest platform does not require a minimum deposit amount to begin using its Robo-advisor services. This makes it stand apart from some of its competitors with such requirements.

Many Canadian investors enjoy using the Wealthsimple Invest platform because it is an “autopilot” method of investing. 

The Robo-advisor offers automated deposits and rebalancing of an investment portfolio. It also automates the process of dividend reinvestment.

Another amazing thing about Wealthsimple Invest is that it supports different risk levels by offering three unique risk profiles.

Furthermore, Wealthsimple Invest allows users to diversify their portfolio with a wide range of assets including U.S., Canadian, and International stocks. 

In addition, Wealthsimple Invest supports Socially Responsible Investing with its Wealthsimple SRI portfolio. And, people of the Islamic faith can invest in Halal portfolios.

Best Robo-Advisor for Beginner Investors in Canada

Over the years, Wealthsimple Invest has proven to be the best Robo-advisor for new investors in Canada. 

The platform offers so many benefits and amazing features that make it a great choice for anyone just getting started in the investing world. 

Below is a quick highlight of some reasons why beginner investors may like to consider trying out Wealthsimple Invest.

  • Easy signup process: It is relatively easy to register a new account on the Wealthsimple Invest platform. Within a few minutes, you can sign up and begin your investing journey even as a beginner on the platform.
  • Low fees: Wealthsimple Invest currently charges 0.4% – 0.5% as a management fee and a portion of the mutual funds’ fees.
  • No minimums: With as little as $1, you can quickly get started on the Wealthsimple Invest platform because it does not have a minimum investment requirement. 

How Does Wealthsimple Invest Work?

Like every other Robo-advisor out there, Wealthsimple Invest lets you invest your funds in a portfolio that is built and managed automatically for you. 

First, you will need to provide answers to a few questions that help Wealthsimple Invest understand your risk tolerance and investment goals.

These questions will be asked during your registration process and the answers you provide will be used to create a customized investment portfolio that suits your needs.

Based on the answers you provide, the Wealthsimple Invest Robo-advisor could recommend any of the following portfolios:

  • Growth Portfolio
  • Balance Portfolio
  • Conservative Portfolio

Bear in mind that each of the portfolios listed above is built on diversified ETFs with investments in bonds and stocks.

Once you have selected a portfolio that fits your needs, you can then proceed to fund your Wealthsimple Invest account. 

Since there is no minimum investment requirement with Wealthsimple Invest, you can fund your account with any little money you have now. 

As time goes by, you can also increase your investment amount by contributing more money to your account.

After choosing a portfolio and funding your account, the Wealthsimple Invest Robo-advisor takes it up from there. 

The Robo-advisor will automatically invest your money, rebalance your portfolio, and reinvest the dividend/interest you earn over time. 

All other tasks regarding the management of your portfolio will be handled by the Robo-advisor.

Wealthsimple Invest Portfolios

The Wealthsimple Invest Robo-advisor only recommends three categories of portfolios. 

The three categories are Growth, Balanced, and Conservative portfolios. The management fees for all these three portfolios are the same.

However, the MER charges for each are different because they have varying underlying ETFs and risk profiles. 

Investors on the Wealthsimple Invest platform also have the option of choosing Halal or SRI portfolios that align with their values and risk tolerance. 

With all these categories of investment portfolios, you might be wondering: how well have they performed over time?

Well, I have got that covered below; let’s take a closer look.

Classic ETF Portfolios

The table below shows a complete breakdown of how the Wealthsimple Invest Classic ETF Portfolios performed between August 20, 2014, to November 30, 2022.

ETF PortfolioPerformanceEquity AllocationManagement Fee MERRisk Tolerance
Conservative portfolio 17.39%30-40%0.50%0.16%Low
Balanced portfolio27.24%50-65%0.50%0.16%Low-to-medium
Growth portfolio56.29%75-90%0.50%0.13%Medium-to-high

SRI Portfolios

If you are looking to only invest in Socially Responsible Companies, the Wealthsimple Invest SRI portfolio caters to that. 

Below is a breakdown of how the SRI Portfolios performed between August 20, 2014, to November 30, 2022.

SRI PortfolioPerformanceEquity AllocationManagement Fee MERRisk Tolerance
Conservative SRI portfolio 14.16%35%0.50%0.25%Low
Balanced SRI portfolio24.22%50%0.50%0.23%Low-to-medium
Growth SRI portfolio47.53%80%0.50%0.22%Medium-to-high

Halal Portfolios

These sets of portfolios are designed specifically to suit the needs of people that identify with the Islamic faith and laws. 

Wealthsimple Invest charges 0.4% – 0.5% management fees on the Halal Portfolios and an MER of 0.23% – 0.47% applies to the Halal ETFs. 

Below is a breakdown of how the Wealthsimple Invest Halal portfolios have performed between August 23rd, 2017, to November 30, 2022.

Halal PortfolioPerformanceEquity AllocationRisk Tolerance
Conservative Halal portfolio 16.82%Mix of Shariah-compliant Wealthsimple World Equity Index ETF, Gold and non-interest-bearing cashLow
Balanced Halal portfolio25.76%Mix of Shariah-compliant Wealthsimple World Equity Index ETF, Gold and non-interest-bearing cashMedium-to-high
Growth Halal portfolio42.44%Mix of Shariah-compliant Wealthsimple World Equity Index ETF, and  GoldMedium-to-high

Classes of Wealthsimple Invest Asset 

Each of the Wealthsimple Invest portfolios discussed in the previous section of this article is built with 8-10 ETFs in different asset classes.

Regardless of which portfolio you choose, the Wealthsimple Invest Robo-advisor ensures that your holdings comprise 8-10 asset classes. 

Below is a table showing some of the most common asset classes on the Wealthsimple Invest platform.

Asset ClassETF Type
U.S. Equities (VUS, VTI, QUU)Vanguard US Total Market Index ETF (CAD-hedged)Vanguard Total Stock Market Index Fund ETFMackenzie US Large Cap Equity Index ETF
Canadian Equities (QCN, VCE, ZCN, VCN)Mackenzie Canadian Equity Index ETF Units Series EVanguard FTSE Canada Index ETFBMO S&P/TSX Capped Composite Index ETFVanguard FTSE Canada All Cap Index ETF
Global Equities (ACWV, XMW, GLOV)iShares MSCI Global Min Vol Factor ETFiShares MSCI Min Vol Global Index ETFGoldman Sachs ActiveBeta World Low Vol Plus Equity
Canadian Long-Term Government Bonds (ZFL, VLB, XLB, PGL)BMO Long Federal Bond Index ETFVanguard Canadian Long-Term Bond Index ETFMaterials Select Sector SPDR FundInvesco Long-Term Government Bond ETF
International Equities (ZEA, VIU, IEFA)BMO MSCI EAFE Index ETFVanguard FTSE Developed All Cap ex N Amer Idx ETFiShares Core MSCI EAFE ETF
Gold (CGLC, GLDM)iShares Gold Bullion ETFSPDR Gold MiniShares Trust
Emerging Market Equities (EEMV)iShares MSCI Emerging Markets Min Vol Factor ETF

You should bear in mind that your specified risk tolerance will determine how each of the above asset classes will be allocated to your portfolio.

A good example is the Classic Growth ETF portfolio which has a higher risk tolerance compared to the Classic Conservative ETF portfolio. 

The allocation to asset classes for the Growth ETF portfolio will also be higher than that of the Conservative ETF portfolio.

Wealthsimple Invest Accounts

Wealthsimple Invest supports multiple investment accounts that help investors achieve their financial goals. 

Below is a list of accounts that are currently accessible on the Wealthsimple Invest platform.

  • Business account
  • Personal account
  • Joint account
  • TFSA
  • LIRA
  • RRIF
  • RRSP
  • RESP
  • SRI
  • Halal Investing

From the above list, you can see that Wealthsimple Invest supports both tax-sheltered and non-registered accounts. 

Wealthsimple Invest Plans

The Wealthsimple Invest platform has three different plans that determine the management fees, deposit limits, and packages of each investor. 

See the table below for an overview of the key features of each Wealthsimple Invest plan.

Plan Key FeaturesNet Deposit(s)Management Fee
Basic Auto-deposit personalized portfolioAuto-rebalancingExpert financial advice dividend reinvestment$1 to $100,0000.5%
BlackAll the features of the Basic plan financial planning session Tax-efficient fundsTax-loss harvesting6 months of free Medcan Year-round Care plan (only for Ontario clients)Discounted Will preparation (15% off your first online will with Willful)$100,000 or more0.4%
GenerationAll the features of the Black plan personalized portfolios Asset location Personalized financial report50% off Medcan’s Comprehensive Health plan (only for Ontario clients)In-depth financial planning A dedicated team of advisors + access to expert portfolio managers$500,000 or more0.4%

Pros and Cons of Wealthsimple Invest

Like other Robo-advisors out there, Wealthsimple Invest has its benefits and drawbacks that are very important to mention in this Wealthsimple Invest review.

Here are some of the major pros and cons of Wealthsimple Invest at the moment:

Pros

  • It is very affordable: Wealthsimple Invest does not charge inactivity fees or annual fees and this makes it more affordable than other Robo-advisors out there.
  • The platform can be easily accessed: You can access the Wealthsimple Invest platform on a mobile phone or desktop computer at any time. 
  • There are no minimums: Wealthsimple Invest does not require a minimum investment amount as some other Canadian Robo-advisor platforms do.
  • Automated Investing: The Wealthsimple Invest Robo-advisor automates all investing activities like deposits, dividend reinvestment and portfolio rebalancing. 
  • Availability of tax-loss harvesting tool: This feature helps investors reduce tax on their capital gains with an unregistered account on the Wealthsimple Invest platform. 
  • You have access to human managers: Aside from automated investing by Robo-advisor, the Wealthsimple Invest platform also gives investors access to human portfolio managers for additional financial advice. 

Cons

  • Higher fees: Wealthsimple Invest charges 0.40% – 0.50% as management fees on all of its portfolios. This is lower than the traditional mutual funds’ fees but double the management fees charged by other Robo-advisors.

Wealthsimple Invest Fees

While other Canadian Robo-advisor platforms charge an inactivity fee and annual fee, Wealthsimple Invest doesn’t.

Nonetheless, Wealthsimple Invest users pay management fees and a Management Expense Ratio (MER).

At the moment, investors with a balance under $100,000 pay a management fee of 0.50% on the Wealthsimple Invest platform. Meanwhile, those with investments of over $100,000 pay 0.40% as a management fee.

These management fees charged by Wealthsimple Invest are somewhat higher than that of other popular Robo-advisors in Canada. 

However, many other Robo-advisors like Qtrade Guided Portfolios and Justwealth charge a management fee that is closer to that of Wealthsimple Invest. 

As for Management Expense Ratio (MER), Wealthsimple Invest charges the following:

  • 0.13% – 0.16% for Classic ETF portfolios
  • 0.50% for SRI portfolios
  • 0.25% – 0.50% for Halal portfolios

Is Wealthsimple Invest Legit and Safe?

Yes, Wealthsimple Invest is legit because it is a platform offered by Wealthsimple Inc – a company that is regulated by the Investment Industry Regulatory Organization of Canada (IIROC).

Also, every dollar invested on the Wealthsimple Invest platform is protected by the Canadian Investor Protection Fund (CIPF) up to the tune of $1 million per insured category. 

In addition, the Wealthsimple Invest platform uses Two-factor authentication and other advanced encryption systems to protect the data of its users. 

And that is not all; records available to the public show that the main company – Wealthsimple Inc had an estimated CA$15 billion worth of assets under management as of 2021.

All this information should give you enough confidence that Wealthsimple Invest is a legit and safe investment platform in Canada.

How to Open a Wealthsimple Invest Account

The entire process of opening a new Wealthsimple Invest account can be completed within minutes online.

You only need to visit the Wealthsimple web portal or download the mobile app to get started immediately. 

Whether you are registering via the Wealthsimple mobile app or web portal, follow the steps listed below to open a new Wealthsimple Invest account.

  • Enter a valid email address and password
  • Verify your email address
  • Login to your new Wealthsimple account
  • Answer the questions presented to you and wait for Wealthsimple to recommend a portfolio that matches your goals and risk tolerance
  • Connect your bank account and fund your Wealthsimple Invest account
  • Start your investing journey

You should bear in mind that you can also register for a new Wealthsimple Invest account using a referral link from friends, family or trusted sources. 

Doing that will earn you and the referrer a bonus of up to $50 after you fund your new account.

Wealthsimple Invest Alternatives

As promised earlier in this post, let’s compare Wealthsimple Invest to some of the Robo-advisors in Canada.

Wealthsimple Invest vs Questwealth Portfolios

While searching for the best Robo-advisors in Canada, you might have come across Questwealth Portfolios. It is a popular Robo-advisor platform that is best known for its relatively low cost. 

See the table below for a brief comparison between Wealthsimple Invest and Questweath Portfolios:

FeatureWealthsimple InvestQuestwealth Portfolios
Minimum deposit requirementNone$1,000
CIPF protectionYesYes
Management fee0.4% – 0.5%0.20% – 0.25% 
ETF MER0.13% – 0.16%0.17% – 0.22% 
Portfolios Conservative, Balanced, GrowthAggressive growth, Growth, Balanced Income, Conservative Income
Supported accounts Personal, Joint, Business, RRSP, RRIF, LIRA, TFSA, RESP, SRI, and HalalCash, Corporate Cash, TFSA, RRSP, RESP, RRIF, LIRA, and LIF
Investment managementPassiveActive
Tax-loss harvestingYesYes

One unique feature of Questwealth Portfolios is that the platform uses an “Active” investment management approach instead of the passive one used by Wealthsimple Invest.

Despite the active investment management, Questwealth Portfolios still manages to outshine Wealthsimple Invest in terms of management fees. 

The only major downside to the Questwealth Portfolios platform is that it requires a minimum investment of $1,000 for users to get started. 

Wealthsimple Invest vs Justwealth

Justwealth is another Robo-advisor platform that is currently gaining a lot of attention from Canadian investors.

The Justwealth Robo-advisor is best known for its RESP accounts even though it supports other investment accounts like Wealthsimple Invest. 

Below is a list of some non-registered and registered accounts currently supported by Justwealth.

  • RESP
  • TFSA
  • RRSP
  • RRIF
  • LIRA
  • LIF

At the moment, Justwealth offers about 70 different portfolios and this makes it stand out from all other Canadian Robo-advisors including Wealthsimple Invest. 

Bear in mind that you need a minimum investment amount of $5,000 to start your investing with Justwealth. 

This might be a turnoff for some people because it is higher than that of Wealthsimple Invest and Questwealth Portfolios.

Also, Justwealth charges a management fee of $2.50 on RESP accounts and $4.99 on non-RESP accounts. 

LEARN MORE: Justwealth vs Wealthsimple Comparison

Tips for Choosing the Best Robo-Advisor in Canada

When choosing between different Robo-advisors, look beyond the name and “hype” around any company or platform. 

It is also recommended that you consider the following factors before making your choice.

  • Available portfolios and assets allocations
  • Minimum investment requirement
  • Management fee and MER for each portfolio offered
  • Supported investment accounts and available securities 
  • Past portfolio returns and performance

You can as well make a checklist from the factors listed above. That way, you will be able to easily determine which Robo-advisor best suits your needs and investment objectives. 

RELATED:

Wealthsimple Invest Review: Final Thoughts

If you’re looking for a simple, convenient and low-cost way of investing without much effort on your part, then passive investing through Wealthsimple Invest is worth considering. 

With everything taken care of by the Robo-advisor, all you need to do is sit back and watch your investments grow. 

Despite charging a higher management fee, Wealthsimple Invest still clearly beats some of its competitors in many other ways.

Having considered so many factors discussed above, I will say that my overall Wealthsimple Invest review is positive. 

The Wealthsimple Invest Basic plan is a perfect choice for beginner investors with low capital. 

Likewise, the Black or Generation plan will make a great choice for anyone with a high net worth and bigger investment capital. 

FAQs on Wealthsimple Invest review

What’s the difference between Wealthsimple Trade and Wealthsimple Invest?

Wealthsimple Trade is a self-directed investing and trading platform while Wealthsimple Invest is a Robo-advisor platform for passive investing. 

Both Wealthsimple Invest and the Wealthsimple Trade platforms are offered by the same Canadian company, Wealthsimple Inc. 

Can you withdraw money from Wealthsimple Invest?

Yes, you can withdraw your funds at any time from the available balance in your Wealthsimple account via a bank transfer.

How much do you need to invest in Wealthsimple?

Both the Wealthsimple Invest and Wealthsimple Trade platforms require no minimum investment amount.

This means that you can start your trading journey on Wealthsimple Invest with any little amount you have at the moment. Then add to it in the future as your investment knowledge grows over time.

Is the Wealthsimple Robo-advisor a good investment?

Like every other Robo-advisor, Wealthsimple Invest is a great choice for many investors looking for a passive investment approach.

The Wealthsimple Invest robo-advisor has a record of good performance but this is not indicative of the future as with all other robo-advisors out there. 

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About John Adebisi

John Adebisi is a CPA, FCCA and MBA holder with a Bachelor's degree in Accounting & Finance. He has over a decade of experience in writing personal and business finance content for audiences across North America, Europe, the UK and Africa. In addition to his writing experience, he also has a strong background in financial research and analysis, giving him a unique perspective of the financial markets. John derives pleasure in helping people make smart financial decisions, and he believes that knowledge and experience can be valuable resources for anyone who wants to learn how to manage their money.

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