An online portfolio manager that manages financial holdings via patent-pending algorithms, SigFig got its name from the concept of “Significant Figures” in mathematics.
SigFig first came on the scene in 2006 under the name Wikinvest and became SigFig in 2011. It has 309,000 users and manages $70 million dollars in assets. While not as sophisticated as Wealthfront or Personal Capital, this robo-advisor recommends investments by using an algorithm. SigFig reviews show that the service offers a passable mix of automated advice that may work for some investors.
You’ll need at least $2,000 to open a SigFig account. There’s no management fee if you invest between $2,000 and $10,000 with them. Account balances over $10,000 incur a 0.25% fee. If you invest $20,000, that means you’ll pay a fee of $2.08 a month, versus $21.67 for a traditional investment advisor.
As a robo advisor, SigFig uses artificial intelligence to optimize investments and manage portfolios with little to no human intervention.
SigFig doesn’t accept 529 Plans and Trusts.
After answering a few questions and creating a login, you’ll have access to SigFig’s online dashboard and app.
SigFig’s automated system compiles historical data and runs simulations to determine how the market may perform. After receiving a variety of outcomes, the Wealth Charts in the dashboard will show you this information to indicate potential results.
SigFig holds your money with its partners, Fidelity, Schwab and TD Ameritrade Institutional. Your money will stay with your brokerage if you already have an account with one of them. SigFig will open an account for you at TD Ameritrade Institutional if you have an account at a brokerage house other than the ones they use.
The company invests your money in ETFs and funds. They avoid purchasingindividual stocks because it would result in higher fees for their users, particularly those with smaller balances.
You can link your checking or savings accounts and withdraw or deposit money through your SigFig dashboard. Select the “Managed” tab on your account after logging in, and click “Withdrawal” to take out money.
Click “Edit Allocation” under the “Managed Tab” if your financial situation changes and you want to invest in higher-risk securities. SigFig’s automated system will change the asset allocation to your new preference.
Your end of the year tax forms will continue to come from your brokerage house, not SigFig.
You can set up the company’s free Portfolio Tracking feature in about a minute. Import your brokerage information, and you’ll see all your information in the app’s “View Holdings” section. The “Report Card” tab shows you how your portfolio compares to the current market. Sigfig assesses your portfolio with star ratings from one to five stars.
The Portfolio Tracker sends you an email each week letting you know how your investments are performing. The email includes a brief assessment of your portfolio and gives you a list of the week’s top market securities and investments.
You can sign up for Managed Account Solutions for more guidance if you like the free tracking service.
Access SigFig’s dashboard on a desktop computer, iPad, iPhone or Android. Their user-friendly apps employ colorful graphs and easy to understandbreakdowns so you can get a fill view of your investments without wading through complicated information.
SigFig manages brokerage accounts. It offers minimal financial help in other areas and doesn’t track spending or credit card use like Personal Capital and a few other robo-advisors.
You’ll receive a well-balanced portfolio consisting of Vanguard, Schwab and other commission-free ETFs. You can choose how you want your account funded. Use an existing brokerage account or start a new one with cash.
When any of your investments has a poor rating, according to SigFig’s algorithm and market comparisons, the App will indicate how you can improve your portfolio’s value. Recommendations are based on your risk tolerance and other preferences.
Combine your certificates of deposit (CDs), US Treasuries and bonds in this low-rate account. If you have an extensive fixed income portfolio, this may be an excellent choice for you.Sigfig’s Diversified Income managed account has a minimum $100,000 investment and a 0.50% yearly fee.
SigFig rebalances when the financials markets move your investments more than a few points from your desired target. They regularly review your account and market conditions and adjust your portfolio to protect your investments for adverse changes.
The robo-advisors purchase ETFs for your portfolio when you add cash. This addition keeps your target allocation the same. The company keeps transaction costs low by avoiding relatively small purchases.
Sigfig’s Tax Loss Harvesting feature reduces your tax liability by selling holdings that have experienced losses to counterbalance realized gains. Selling stocks or ETFs that have increased in value will cause you to pay taxes on capital gains. Tax-loss harvesting maintains your portfolio’s value while reducing your yearly tax bill.
For users with problems such as cash flow drag or lack of diversification, SigFig offers a Guidance feature to diagnose issues based on your answers to a questionnaire and your current account status.
Guidance looks at your portfolio and shows you which investments are causingthe problems. It then recommends more efficient options.
Your SigFig account is protected by the same trustworthy encryption banks use. SigFig runs audits to check security levels. They also validate security through Verisign. Sigfig monitors its servers by surveillance cameras 24/7. Many encryption layers further protect your data from hackers.
SigFig has iPhone, iPad, Apple Watch and Android mobile apps, as well as desktop computer login. The company offers 24/7 email customer service and a phone help line from 9 a.m. to 6 p.m. Pacific Time seven days a week.
You can cancel your account anytime by calling the company’s direct support line. You won’t pay a penalty. SigFig will no longer be an advisor on your account, and you’ll keep all your holdings.
Sigfig lacks the tools needed for investors with more complex needs, such as trusts. The company depends on algorithms, which may not serve the needs of high-asset clients who need more input from real-life advisors.
Even for low-asset investors, the advice may prove incorrect since it’s based on previous performance with only some basis on proper asset allocation. The services occasionally recommend funds with high fees, which may causeproblems for investors with low balances.
SigFig’s affordable, straightforward system offers benefits for low-balance investors with minimal needs. If you don’t need to talk with an advisor or feel more comfortable with a service that’s digital only (except for phone support), it’s worth a try.
The service’s focus on consumer education and rebalancing accounts will prove helpful to young investors unfamiliar with financial jargon.
SigFig reviews give the app high marks for its intuitive nature and low fees. BestCompany rates it #28 out of 44 automated investment advisors, and well-known business sites (Forbes, Business Insider) lack reviews for the product.
A digital financial advisor offering the bare minimum of services, SigFig has partnered with Wells Fargo to attract young investors. For first-time investors, the service offers a good introduction to savings and securities. More seasoned investors can benefit from robo-advisors with more services.