SoFi Invest Review – Why It May Be a Great Investment
In today’s world of online trading, charting, investing, and brokering there is a multitude of tools to choose from. There are so many companies claiming to be the best place to trade stocks, it is difficult to keep up with them all.
However, amidst all the marketing noise, there may be one platform that stands out above the rest. We performed an in-depth SoFi Investment Review which showed how SoFi stacks up to its competitors.
So, how does SoFi stack up against its competitors?
First, SoFi Invest’s trading platform does not have a minimum investment requirement. This can be a benefit for beginning traders because they often have small balances for their portfolios. Fees — even small ones — can start to quickly add up when you aren’t working with a lot of money, to begin with.
Next, SoFi Invest has a zero-dollar Management Fee. This is another advantage for all investors because every dollar that goes towards fees is money that cannot compound over time for the investor.
In addition, the average expense ratio for SoFi is 0.05%. This number is not only significantly below the average, but it is also a number that will not jeopardize future return potential. If you had $100,000 invested, an expense ratio of 0.05% will cost a whopping $50 per year. That’s not bad for an investment platform that has a lot to offer.
If you would like to read a SoFi Invest Review, you can read our review here.
SoFi Invest Roth IRA’s
The Roth IRA is a modern invention and wasn’t invented until 1997. It was created as a part of the Taxpayer Relief Act and was designed to incentive young investors to save more. A Roth IRA is a retirement account just like an IRA, but it comes with one additional bonus — all gains that you take out after the age of 59.5 are tax-free. That means all the gains you have acquired over decades of investing can be taken out (after the age of 59.5) without paying a single dollar in taxes.
The tax advantages of Roth IRAs can be enormous when you consider how much of your retirement money will be capital gains. Assuming an investor was in the 20% tax bracket, and had a $1,000,000 portfolio at retirement with $750,000 of that being capital gains, they would lose $150,000 of that to taxes. The Roth IRA investor gets to keep all $750,000 to themselves.
We performed a full review of the SoFi Invest Roth IRA options if you would like to read further about the Roth IRA.
SoFi Invest for Stock Trading
Trading stocks can be one of the most expensive activities an investor will encounter. Further, as trading fees start to add up, it becomes much more difficult for investors to outperform the market when they have to pay trading fees. Trading conveniently and cheaply is good for investors, and SoFi has this covered.
SoFi offers two different platforms for trading — SoFi Active Investing and SoFi Automated Investing. SoFi’s stock trading features are robust, and they include services such as:
- Recurring Purchases
- Watchlists
- Cryptocurrency Trading
- Free Access to Financial Advisors
We performed an in-depth review of SoFi’s Stock Trading if you would like a more detailed outline.
SoFi Invest for Automated Investing
There is another incredible feature that SoFi offers that could have an enormous effect on investors’ returns. SoFi Invest offers a robe-advisor platform that requires a mere $1 to get started.
First, Robo-advisors are extremely cost-effective because you do not have to pay exorbitant fees to a human advisor. Fees are one of the main reasons so many professional money managers underperform the S&P 500. Their fees end up reducing the investor’s returns, and over several decades those fees start to diminish returns.
Having said that, robs-advisor returns are not a guarantee. Past performance is not an indicator of future performance, and every investor should thoroughly review what they are buying. A good benchmark to always compare returns to is the S&P 500. Most individual investors have access to low-cost ETFs that mirror the S&P 500, so be sure to compare returns with returns of the S&P 500.
We performed a full review of SoFi’s Automated Investment options for more information.
In a review, we highlighted a detailed outline of the benefits of SoFi Automated Investing, which included additional offerings such as:
- Zero fees
- Goal planning
- Free advice from CFPs
- Quarterly automatic rebalancing
- Diversification
SoFi Invest Review Conclusion
In summary, SoFi Invest has enormous benefits to it and there are many reasons to be attracted to the trading platform. However, all investments should be thoroughly researched, and the decision is ultimately up to the individual investor.
If you would like to sign up for SoFi, use this link to get started.
