You can automate and manage your own investments easily, and without fees. Setting up an automatic investment plan is simple, and costs nothing to implement. Best of all, you are in control of the plan if you need to make changes, and you don’t need a robo-advisor to do it.
An effective way to save and invest with discipline is by automating the process so you don’t have to think about it day to day. When you establish electronic bank transfers between your bank and your investment firm, you can do it with the schedule, frequency, and the amount you choose. You only have to fill out a form from your broker, and once it is processed you are good to go.
An important first step is to consider account minimums. Unless you already have a portfolio in place, you will first need to establish a minimum investment in each of the funds to be used in your allocation. Set up the automatic investments once you establish all the accounts. Each broker is a little bit different, and normally you have to buy their funds if you want to avoid added fees, so choose a broker that features the funds you are seeking. That is, consider the funds you want before selecting your broker. Then you need to consider whether the accounts will be taxable or tax-advantaged (Traditional IRA, Roth IRA, etc.)
Here are summaries of investment account minimums, and automatic investment minimums, for three commonly-used brokers.
- Investment Account minimum $1,000
- Automatic investment $100 minimum with no fees when investing in any Schwab OneSource Select List Fund
- Investment Account minimum $2,500
- Automatic investment $10 minimum into any Fidelity fund, and no fees for Fidelity funds or No Transaction Fee (NTF) FundsNetwork funds
- Investment Account minimum $1,000 for Vanguard Target Retirement Funds and Vanguard STAR® Fund. $3,000 for most other Vanguard funds
- Automatic investment $1 minimum into any Vanguard fund