1) 77% of Canadian Robo Advisors users said that robo advisors were “Much Better” or “Better” than with traditional banking/investing experiences (only 3% chose “worse”).
2) 75% have either already recommended a Robo Advisor to their friends, or else plan to do so (only 2% will not recommend).
3) 59% of Robo users are more likely to save for retirement after using a robo advisor than they were before!
Young and Thrifty is proud to share the results of our first ever original data collection effort! The goal was to measure Canadians’ attitude and experience with robo advisors. We know that robo advisors are quickly growing and that we have received hundreds of emails asking us robo advisor questions, as well as thanking us for the information in our Canadian Robo Advisor Guide. What we were curious about, was if these anecdotes were illustrative of the broader truth, or if dissatisfied people simply weren’t speaking up.
We should highlight the fact that we are not credentialled pollsters (but I do listen to the 538 podcast and minored in Nate Silver writing) and this survey is not indicative of the Canadian public at large. This data (nearly 400 robo advisor user responses from all of the major Canadian companies) was collected on a voluntary basis from Young and Thrifty readers and attendees of the first annual Virtual Canadian Financial Summit. We’d like to think our readers are substantially more financial literate than the average Canadian, and probably skew younger, as well as slightly higher net worth than the average. Thank you to everyone that particpated! Here are some of the most noteworthy results with full methodology details (and prize winners) seen below.
Some other interesting info that isn’t likely to be found particularly noteworthy to the average reader, but might say something about the industry overall investing habits: 28% of robo users check their accounts at least once a week, and nearly 86% check their accounts more than once a month! For someone that routinely preaches the benefits of a passive investing mindset, this worries me a little!
If you’re interested in the full methodology behind these results, here are the questions that we asked:
1) I am __ years old
2) I live in __ Province
3) I identify as
- Prefer not to disclose
4) My annual income is:
- Below $40,000
- $40,000 – $60,000
- $60,000 – $80,000
5) How long have you been using a robo advisor?
- Less than six months
- Between six months and one year
- Between one and two years
- More than two years
- I’m not with a robo advisor
6) Please select (you can select multiple answers) which of the following Canadian robo advisors that you have opened an account with:
- Nest Wealth
- BMO SmartFolio
- Portfolio IQ
7) Please indicate which of the following accounts that you have opened with one or more robo advisor(s). You can select multiple answers.
- Spousal RRSP
8) Please fill in the blank in this statement. Relative to before I opened a robo advisor account, using a robo advisor has made me _____ to invest for my retirement.
- Much more likely
- More likely
- Equally likely (no difference)
- Less likely
9) I’d describe opening and setting up a robo advisor account as being:
- Quick and easy
- Relatively easy, but not quick
- Not exactly easy, but not difficult
10) I’d describe my use of my robo advisor online platform account as being:
- Very user-friendly and enjoyable
- Mostly user-friendly and enjoyable
- Somewhat user-friendly and enjoyable
- Non-user-friendly and not enjoyable
11) The best description of the risk profile and goals questionnaire that I completed before opening my robo advisor account would be:
- I don’t remember answering any questions when I opened my account
- Complete and comprehensive
- Somewhat comprehensive
- Mostly incomprehensive and incomplete
- There were very few questions and they were useless in my opinion
- I’m unsure and/or don’t really understand what is needed to determine my investing risk profile.
12) I believe that the investments recommended for my robo advisor portfolio are:
- Appropriate for my risk tolerance
- Too risky
- Too conservative
- I have already overrode the robo-generated portfolio and asked for different investments.
- I don’t know enough about investments to answer this question accurately
13) Did your robo advisor inquire at any point after your initial set up to see if anything about your financial goals or risk tolerance had changed?
14) Which option below BEST describes how you are transferring money to your robo advisor?
- I have set up an automatic contribution plan so that my money is automatically invested periodically. (ex: every month $250 goes into my account)
- I manually transferred a large lump sum (more than $5,000) and am now just waiting to see before I transfer any more.
- I manually transfer money consistently. (ex: every week, every month, every 3 months, etc.)
- I manually transfer money whenever I think about it or whenever I have a little extra left over to invest.
- I use my robo advisor account only to invest in RRSPs during RRSP season each year.
15) How often do you check how your robo advisor investments are performing?
- More than once a week
- Once a week
- Once a month
- Less than once a month
- I purposely never check them
- I just never get around to checking on them
16) I’d BEST describe my interactions with the “advice” or “advisor” part of my robo advisor as:
- I have no wish to talk to a human being as part of my robo advisor experience and/or I have had no questions.
- My questions were all answered by email or online chat, and I thought the response time was appropriate.
- I’ve asked several questions by email or online chat and have been disappointed with the response time and/or the content of the response.
- I wished to talk to someone via phone and was disappointed with the lack of response, or content of the response.
- My robo advisor initiated contact for planning purposes and I thought this was valuable.
- My robo advisor initiated contact for planning purposes and I thought this WAS NOT valuable and/or I did not want it.
17) I access my robo advisor account through the following pieces of hardware. Select more than one if applicable.
- An app on my phone
- An internet browser on my phone
- A tablet
- A laptop
- A desktop
18) The MOST IMPORTANT reason I decided to open a robo advisor account was:
- Low fees
- Easy and/or convenient way to save and invest
- Accessible financial advice
- An eye-catching promotion
- Investment returns
- Perks such as tax-loss harvesting or loyalty programs
19) I would best describe the likelihood that I will use a robo advisor as my primary means of investing for my retirement as:
- Very likely or definitely
- More likely than not
- Maybe, maybe not
20) When I compare the overall experience of using a robo advisor to more traditional banking/investing services, I would say it is:
- Much better
- Roughly equal
- I don’t have any traditional banking/investment experience to compare to
21) When thinking about your experience with robo advisors, which statement best describes your current attitude:
- Love them and/or have already recommended them to friends
- So far so good, I plan on recommending them to friends
- I’m still uncertain, I may recommend them to friends at some point
- My experience has been mostly negative and I’m unlikely to ever recommend robo advisors to friends
22) In regards to my knowledge about concepts such as budgeting, investment returns, investment risk, insurance needs, credit score fundamentals, and other aspects of financial literacy, I would describe my knowledge level as:
- Excellent and/or I read about personal finance weekly if not more often
- Very good and/or I read about personal finance monthly if not more often
- Mediocre and/or I rarely read about personal finance, but I feel that I have a solid grasp on money management
- Less than mediocre and/or I rarely read about personal finance and would not consider myself to be “financially literate”.
23) I first became aware about robo advisors through viewing:
- Young and Thrifty
- A Canadian personal finance website that is not Young and Thrifty
- Online advertising other than Young and Thrifty or a Canadian personal finance website
- An online or print news article
We didn’t report all of the data simply because it would have made for much too long an infographic and because some if it wasn’t all that conclusive. Overall, it appears that people are quite happy with the value proposition put forward by the robos so far!
As a thank you to our readers for being awesome and taking time out of their busy lives to help us out with this, we’re pleased to announce that announce the following winner of cash prizes!
The winners of our incentive to take part in the survey are:
Grand Prize Winner ($250) – Tyler G. from Toronto, Ontario
Almost-Grand Prize Winner ($100) – Melissa L. from Vancouver, British Columbia
Nearly-Grand Prize Winner ($100) – Shawn F. from London, Ontario