Our content is free. When you purchase through links on our site, we earn a commission. Learn more

Robinhood vs. Wealthfront: Which is Best for You?

There are many investment platforms available today, and there are advertisements daily for new ones, it seems. With novice investors seeking opportunities to get started, it can become a little overwhelming to begin building a portfolio. But, let’s face it, you aren’t retiring on interest from a money market account.

Two platforms have made it their business to make investing easier for people regardless of age or experience. The two platforms are Robinhood and Wealthfront. By learning a little bit about them both, you can have high yields, while having much fun investing, with less stress.

What is Robinhood?

Let’s be clear; Robinhood is synonymous with Robinhood Markets and utilizes a bare-bones platform. Robinhood is famous for commission-free investing in the areas of stocks, ETF’s, cryptocurrency, and also options.

The trading platform is straightforward, but it will meet the basic needs of an investor. More sophisticated investors might find the platform lacking in features, but Robinhood never intended to serve those types of investors.

Robinhood provides access to free research and data, but the scope is a bit limited. To gain access to more detailed information and analysis, such as “level 2” data, then you need to subscribe to their “Robinhood Gold” membership. It has a fee of five dollars per month as of this writing.

What is excellent is that Robinhood has no minimum to start nor maintain an account. As long as you have the funds available to execute the trade you desire, you may begin trading. With the free account, you do get access to margin-trading, but it is relatively limited. To get access to higher margins, you need to subscribe to their Robinhood Gold membership.

What is Wealthfront?

Wealthfront is a technology-based investment platform that attempts to take the stress from the investor and encourages them to rely on technology to manage a portfolio for you.

It does require a management fee of 0.25%, which is very reasonable for the investment features they offer.

Wealthfront is known for its tax-loss harvesting features, diversification, and easy-to-use interface.

It appeals to new investors by way of its technology-based recommendations. Clients are helped by not having to continually monitor everything, or worry about things like portfolio balance or proper diversification. Keep in mind that there is a minimum account balance of $500.

Wealthfront supports cash accounts and general investing accounts for individuals, joint accounts, and trusts.

Wealthfront also offers accounts for Roth IRAs, Traditional IRAs, SEP IRAs, and college savings plans, to name a few. They also support 401k rollovers. As of this writing, these are all accounts that Robinhood does not offer, but may in the future.

How are Robinhood and Wealthfront similar?

Robinhood and Wealthfront, while very different, do have a few similarities:

  1. The first way is that they both offer brokerage accounts.
  2. Secondly, you can invest in exchange-traded funds (commonly known as ETF’s).
  3. And finally, when it comes to mobility and technology, they both have apps for Android and Apple devices.

They both offer cash accounts, so you earn interest on your uninvested cash. Still, it’s on par with many of the high-yield savings accounts you find online, such as at Ally Bank.

How are Robinhood and Wealthfront different?

For starters, Robinhood is a trading platform, while Wealthfront is a Robo-investing advisor. The difference is that Robinhood offers tools that make it easier for you, commission-free, to make trades securities.

Wealthfront takes the guesswork out of investing. It has technology built into the platform that buys and sells diversified ETFs on your behalf to tailor a portfolio to your investment goals. It provides sophisticated strategies like tax-loss harvesting and automatic rebalancing, and you don’t have to lift a finger!

Also, Wealthfront charges an advisory fee of 0.25%, whereas Robinhood is entirely free- neither trade nor transfer or annual fees. Wealthfront has an initial investment of $500, while Robinhood requires no minimum.

Who is Robinhood best for?

It mainly depends on the intent of the investor. For example, if you are focused on your trades and analysis, then Robinhood is best for you. If you want full control over which companies you are invested in, and you want to time your trades to take profits, then Robinhood is the right choice for you.

For those who are still on the fence, here are some considerations to decide if Robinhood is best for you.

It is ideal for:

  • Regular traders of stock and options.
  • Traders who prefer mobile-friendly options.
  • Those who trade utilizing margin accounts.
  • Cryptocurrency traders.
  • Those who seek brokerage accounts (or Individual taxable accounts).

Robinhood is excellent for those who already have their retirement accounts figured out and want to do some after-tax investing on their own. It’s perfect for the DIY investor, as well as dividend investors, which is the primary reason I use Robinhood.

Who is Wealthfront best for?

Without a doubt, Wealthfront is for investors who want to put money into an account and not think about it. Wealthfront establishes what your goals are in the beginning, then manages things from there. Your only job is to keep putting money in and not mess things up by changing allocations constantly or withdrawing money repeatedly.

Wealthfront is perfect for:

  • Those who are seeking college savings plans for the kids.
  • People who are looking to set up brokerage accounts but don’t want to monitor them compulsively
  • The passive investor prefers to leave the stock investing analysis to someone else.

Robinhood vs. Wealthfront: Who is better?

There are several factors that we have to consider to come to such a conclusion.

Between the two, if I were a new or younger investor, I would go with Wealthfront. Here, you have the technology to assist you in your investment goals. Wealthfront technology takes much of the stress away. It reduces the learning curve that will help you avoid costly mistakes while increasing the growth of your portfolio.

If I were already an established investor, 401(k), or otherwise, then I would go with Robinhood. That is what I did. I chose Betterment over Wealthfront to manage my retirement and passive after-tax portfolio. So, I use Robinhood for much of my dividend investing stock purchases. If neither option seems right for you, then maybe you’re like me. I ended up choosing Betterment, and I wrote an entire Betterment review. If you haven’t given them a look, it might be worthwhile.


As you can see, it is going to depend upon the attitude and goals of the investor mostly. Regardless of the recommendations, you can make money with either of the two options. Just make sure that you are disciplined, particular about your investments, and stick to a well-thought-out plan.

Both platforms offer many tools to establish a good base of knowledge. They can both get you started and well on your way to confidently investing.

You would be hard-pressed not to find investing in your future. It might seem uncomfortable now. Years from now though, you’ll be overjoyed that you started. Enjoy the comfort and security of knowing you won’t have money-troubles in your later years.

Begin investing today regardless of the platform. Starting is the most critical step. If you don’t like the one you choose, then you can transition into the other — happy investing.

Share This