Over the last decade, banking and financial products have witnessed a significant evolution. Internet and technological advances have powered these changes and made banking significantly more accessible and easier for everyone.
These benefits are not just limited to banking and money management but also extend to investment, which has been one of the primary ways of growing wealth for a long time. With digital investment platforms, commission-free trading, and robo-advisors (a powerful way to invest passively), investing has now become much more accessible than before.
But with so many fintechs and robo-advisors currently available on the market, choosing the right one can be a difficult task. This Wealthsimple vs. Unifimoney article can help you with at least two of the potential choices.
Wealthsimple is primarily an investment platform that has the motto "Get rich slow." This motto might seem counterproductive, considering Wealthsimple is an investment platform created to grow wealth. However, the reasoning behind the motto makes sense. Unifimoney is a full-service online bank with a powerful robo-advisor.
Wealthsimple was launched in September 2014. It is a Canadian-based investment platform and robo-advisor that is available to US and UK citizens as well. Wealthsimple is the largest and most well-known robo-advisor in Canada.
As the name suggests, the investment platform aims to simplify investing for investors. And true to its name, the platform is pretty simple. In fact, it wouldn’t even be a stretch to call it a “bare-bone” investment platform because it offers nothing else. This includes products that are now common with robo-advisors (checking accounts, high-yield savings accounts, credit/debit cards, etc.).
So while Wealthsimple can help you grow your wealth, it doesn’t offer any tools to help you manage it.
Unifimoney is an online bank that offers a full suite of banking and investing products that one might need for managing and growing their money. It comes with a high-yield hybrid checking and savings account (0.2% APY) and an investment platform where you can self-direct your investments or leverage the powerful AI-based robo-advisor. The bank also offers a credit card and an adequate range of loan products (auto, mortgage, student). Moreover, the company is planning to introduce more services to its line-up, including life insurance.
Although both Unifimoney and Wealthsimple focus on investing, the two are very different products. Unifimoney is a full-service bank and an investment platform is part of that package, whereas Wealthsimple is created just for investing. The most prominent differences between the two can be seen in their investment platforms, product line-up, and the cost of the two fintechs.
Both investment platforms offer robo-advisory as well as self-directed investing.
Wealthsimple’s robo-advisor can create a portfolio based on your risk appetite and growth goals. For US clients, the portfolio is created from about ten different asset classes. You can also trade crypto using Wealthsimple, but that's a trade you'll have to direct yourself.
Its auto-invest features, such as auto-deposits and dividend re-investing, really do help your money grow on auto-pilot. You can also get a socially responsible portfolio, a Halal portfolio (made up of 50 individual stocks), and choose your investment portfolio to be funded by overflowing funds and roundups.
Wealthsimple’s growth portfolio (80% of which is made up of six equities) returned a cumulative 4.2% in the last three years. And this is where the Wealthsimple vs. Unifimoney difference becomes significantly starker:
These returns are almost over the same period, and the growth-oriented portfolios created by Unifimoney’s robo-advisor (Moderately Aggressive/Aggressive) offered significantly higher returns. One of the reasons behind these impressive returns is the proprietary market crash index that comes with this robo-advisor, which liquidates a portion of your portfolio just before a market crash and starts buying again when the market normalizes. Also, you can get an ESG equivalent of your portfolio for socially responsible investing.
If there’s an ares where Wealthsimple lacks, it is its range of products, especially if you compare it to a full-service online bank like Unifimoney. But Wealthsimple still delivers what it promises: A simple way to invest. It has a decent automated investment platform, a way to direct trades yourself and buy crypto. Wealthsimple has also added another product to its line-up, but it's still in the Beta phase. The company is starting a “cash” product that would allow you to send and receive money from others, make deposits, and would come with a simple debit card.
Unifimoney offers a more comprehensive range of products, including a credit card with a flat-rate cashback system. It also offers loan products like student loan refinancing, auto-loans, mortgage, and home improvement loans, with HSA and life insurance about to join the product line-up.
If you combine all that with the hybrid checking account and a powerful investment platform, Unifimoney combines almost all your money management needs in one easy-to-use platform. You don't need to move your money around different accounts for different purposes, and you can make almost all major monetary decisions from one account.
Unifimoney offers no-fee banking (if you can maintain the minimum account activity). Investing with Unifimoney will cost you 0.15%, 0.3%, or 1% of your Assets Under Management (AUM), depending on the robo-advisor tier you choose.
Wealthsimple will cost 0.5% of AUM if your portfolio is under $100,000. For portfolios above this threshold, the fee drops down to 0.4%, and features like tax-loss harvesting and tax-efficient funds become available.
Unless you choose the Pro tier of Unifimoney (which costs 1% and is worth the cost), it’s significantly cheaper than Wealthsimple, which means you get more for your money. You get a state-of-the-art robo-advisor, your un-invested money also earns you money in the high-yield checking account, and you can also add precious metals to your investment portfolio.
Wealthsimple and Unifimoney offer you tools and features to invest and grow your money over time, but where Wealthsimple is relatively limited in its approach, Unifimoney goes all out. The return potential of the two investment platform differs quite radically as well.
With Unifimoney, you also get a broader range of services and financial products at a relatively low cost. We would recommend Unifimoney over Wealthsimple, especially if you are part of the intended clientele of Unfimoney (a high-earning professional) because it consolidates all the money management tools and features you might need in one place and offers better growth potential.
The above does NOT constitute an offer, solicitation of an offer, nor advice to buy or sell specific securities. The opinions listed above are not the opinions of Unifimoney Inc. or Unifimoney RIA, Inc. but represent the opinions of independent contributors. These contributors may or may not hold positions in the stocks discussed. Investors should always independently research any stocks listed and form their own opinions, while recognizing that any investments made may lose value, are not bank guaranteed and are not FDIC insured.