If you have a larger-than-average IRA account, and you’re looking for hands-on investment advice – in combination with the service typically provided by a robo-advisor, Rebalance IRA may be the service for you.
The Rebalance IRA calls its investment management process, Rebalance360.
Founded by Mitch Tuchman, Rebalance IRA was among the earliest online investment advisory service or robo-advisor. Tuchman was influenced by some of the smartest passive indexing minds, Burton Malkiel, John Bogle and Charles Ellis.
The Rebalance 360 plan will directly manage your IRA accounts, but they also provide advice on employer sponsored plans, as well as advice for non-retirement financial situations. And even though the name includes IRA, they can also manage taxable accounts.
- What is Rebalance IRA?
- How Does Rebalance IRA Work?
- Rebalance IRA Robo Advising Features at a Glance
- Who is the Rebalance IRA Robo-Advisor Best For?
- Rebalance IRA Drill Down
- Rebalance IRA Robo-Advisor Pros and Cons
- Rebalance IRA Wrap Up
- Personal Capital vs Betterment Comparison
*Disclosure: Please note that this article may contain affiliate links which means that – at zero cost to you – I might earn a commission if you sign up or buy through the affiliate link.
Rebalance IRA is not a typical robo-advisor, and actually represents something of a hybrid between robo-advisors and live human financial advisors. Rebalance IRA and could be compared with Personal Capital or Betterment Premium.
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Rebalance IRA Review
- Investors who might ordinarily choose a traditional financial advisor.
- Investors with more than $100,000 and are seeking retirement account management.
- Many account types available.
- Offers live advisors for financial planning.
- In contrast with most robo-advisors, fees are high.
- High initial investment minimum of $100,000.
What is Rebalance IRA?
Rebalance IRA works primarily with retirement accounts, which is different from the more general investment approach of typical robo-advisors. They not only manage various IRA accounts, but they can also provide advice for employer sponsored retirement plans.
This provides you with an opportunity to get holistic investment management for your entire retirement plan.
But another important area where they depart from most robo-advisors is that they provide live financial advice.
This is a key benefit for those who want access to an advisor for those frequent money questions.
How Does Rebalance IRA Work?
After sign up, which we discuss below, you’ll have access to the entire Rebalance 360 program.
When you sign on with Rebalance IRA you work with both a retirement investment advisor and a retirement service representative.
The Rebalance 360 plan encompasses three components:
Invest360 – A low-fee, globally diversified index fund investment portfolio.
This service is designed for taxable accounts, as well as non-taxable accounts. It uses the same investment methodology Rebalance IRA uses with retirement accounts, but customizes it for taxable accounts.
Plan360 – This is the planning component of the Rebalance IRA platform. This is your financial roadmap, designed just for you and your goals. The Rebalance360 program helps you understand how much you need to save and invest to meet your goals. You also find out what you can spend today and in retirement.
Plan360 goes beyond retirement planning. It helps you to invest for financial goals you may need to reach before retirement. Rebalance IRA creates a plan for you, then they check in with you regularly to make sure you’re still on track. If not, they’ll make recommended adjustments for your spending habits.
Advise360 – Advise360 is designed to provide advice to help you deal with ordinary financial situations, beyond saving and investing. It can help you with refinancing your house, choosing the right insurance policies, and saving for your kids college educations.
Advise360 gives you access to a team of advisers, but also a comprehensive library of white papers, articles , and videos.
Rebalance IRA Robo Advising Features at a Glance
Investment advisory service specializing in retirement account management
|Minimum Investment Amount||$100,000|
|Top Features||Certified Financial Planners for all customers. Branch access for all customers. |
Low-fee diversified index fund investment portfolio.
Retirement and non-retirement account management available.
|Fee Structure||0.70% AUM fee |
$250 one-time setup fee
Trading costs average between $50 - $70 each time your account is rebalanced - twice per year
|Accounts Available|| |
Individual and joint taxable accounts; traditional, Roth, SEP, SIMPLE and rollover IRAs; Regular and Solo 401(k) plans; trusts, custodial, partnerships, and non-profit accounts.
|Investment Funds||53 low fee stock and bond ETFs representing 20 asset classes.|
|Contact & Investing Advice||Available by phone and email, Monday through Friday, 8:30 am to 8:30 pm, Eastern Time|
|Free Services||Education articles and white papers available on the website|
Who is the Rebalance IRA Robo-Advisor Best For?
There are trillions of dollars sitting in self-directed retirement accounts, much of it owned by people who may not be investment savvy. Rebalance IRA can take over management of their accounts, helping to maximize investment returns and reach desired retirement goals.
Rebalance IRA is a good choice for anyone who is looking specifically for advice in managing their retirement accounts.
For 401k account management – check out the Blooom platform.
Obviously, with the $100,000 minimum investment requirement, the Rebalance 360 is good for those who have already begun their retirement saving and investing.
Rebalance IRA is convenient for those who already have their IRA’s with Fidelity or Charles Schwab, as that is where the firm manages your account.
The service is also an excellent alternative to high cost human investment advisors. You can get advice on managing your personal financial situation, apart from retirement. It’s like having a financial planner, but at only a fraction of the cost.
Choose a robo-advisor in under one minute: ROBO-ADVISOR SELECTION WIZARD
Rebalance IRA Drill Down
The fees are charged based upon your account size or assets under management.
|Account Size||AUM Fee|
|$100,000 to $1,000,000||0.70%|
Additional fees include:
- $250 set up charge per account.
- ETF fees average 0.15% and go directly to the fund administrator.
- Transaction charges when account is rebalanced biannually average between $25 to $50 per account.
Minimum Investment Required
We like the availability of live customer service personnel. You can talk to someone about your account or account set up from Monday through Friday from 8:30 am to 8:30 pm EST.
Email is also available.
User Experience – Sign-Up Process
The signup process with Rebalance IRA works a bit differently than other robo-advisors. Instead of beginning with an online application, you have a conversation with the financial advisor.
This quite similar to Vanguard Personal Advisor Services where the advisor drives the investment process.
You’ll start the conversation by providing your name, email address, phone number, time zone, and approximate IRA size.
Armed with that information, you’ll have a phone conversation with a financial advisor, to discuss your financial goals, risk tolerance and time horizon.
During the conversation you’ll determine your current asset allocation. After answering a slate of risk related questions, you’ll create the best asset allocation for you, going forward.
This information helps the financial advisor determine how conservative or aggressive your portfolio needs to be.
Finally, the advisor integrates all of the findings and then creates an investment plan for you.
One of the major advantages of the live phone conversation is that you will have an opportunity to ask any questions you have, either about your retirement or about how Rebalance IRA works and can help you.
Once all the information has been provided, and you agree to the portfolio provided, your account will be up and running within 5 to 7 business days. If necessary, you’ll be required to move your current accounts over to either Fidelity or Charles Schwab.
Access to Human Financial Advice
The live financial advisors at Rebalance360 are one of the best features at this robo-advisor. They have Certified Financial Planners® on staff and you can make an appointment at your convenience.
Additionally, financial advice extends to non-retirement situations. You can discuss your personal financial situation with your advisor, who can advise you on how to save money for the down payment on a home, or even how to manage your budget to make sure you’ll have plenty of money to meet your financial goals.
It is recommended that clients schedule an annual meeting to discuss their complete financial situation and determine if anything has changed over the year.
The live meeting will discuss your retirement goals. This is also an opportunity to discuss any changes in your situation, having to do with your risk tolerance, investment goals, or time horizon.
We like the availability of CFP® advisors. They are well-trained and able to deal with a wide range of financial concerns.
In a very real way, Rebalance IRA bridges the gap between robo-advisors and traditional human investment advisors.
As with most financial platforms, Rebalance IRA uses state-of-the-art data security and encryption services. The firm complies with SEC privacy laws and protects all personal information.
The investments held within the Schwab and Fidelity accounts and are protected by the Securities Investor Protection Corporation (SIPC) up to $500,000 in securities and $100,000 in cash.
“Both firms provide an extra level of coverage from Lloyd’s of London for nearly unlimited amounts of securities and up to $1.9 million in cash.”~Rebalance website
|Robo Advisor||Management Fee||Investment Minimum||Sign up|
|0.25% of AUM (free managment promo)||None||Sign up|
|0.25% of AUM ($5,000 managed for free)||$500||Sign up|
|$1-$9 per month||None||Sign up|
|Basic-None Premium-$30/month ($300 set up fee)||$5,000||Sign up|
Rebalance IRA uses Modern Portfolio Theory (MPT) to create and manage your portfolio. The firm uses asset allocation to increase investment return while lowering risk.
They start by assessing your current assets and allocations. That involves looking at your various retirement accounts and brokerage accounts. Next, they identify areas in your portfolio that need improvement. This can include better coordinating your asset allocations with your risk tolerance. They then recommend a portfolio, customized to help you reach your financial goals.
Rebalance IRA uses a passive management strategy, working to match the market, rather than out-perform it.
Investment Asset Classes
Each asset class is represented by an exchange traded fund (ETF).
ETFs are index-based, and typically have lower expenses than mutual funds. The funds are selected from offerings by Vanguard, iShares, and State Street Bank & Trust.
Your portfolio is built around your personal risk tolerance and comprised of up to six asset classes, including:
- US stocks
- Foreign developed stocks
- Emerging market stocks
- Real estate
- US Treasury bonds
However, the firm doesn’t disclose the specific ETFs used. We prefer more transparency in the available ETF list.
Portfolio rebalancing takes place an average of twice each year.
Rebalancing is the practice of buying or selling securities within the account to return to an initially decided asset mix.
For example, assume you decided upon a 60% and 40% bond portfolio. If during the year the stock market fell and the bond market value remained steady your asset allocation might drift to 50% stocks and 50% bonds.
In that case, Rebalance IRA would sell some of your bond investments and buy more stock funds to return to your preferred 60% stock – 40% bond mix.
Some robo-advisors rebalance more frequently than twice per year.
Our opinion is that there is no significant advantage to more frequent rebalancing. Actually, more frequent rebalancing could hurt your returns should you sell stocks during a period where they were increasing in value. Rebalancing too frequently could mean you miss out on potential gains.
Tax-loss harvesting is not available.
When investments are owned within a taxable account, tax-loss harvesting has the potential to offset investment gains with investment losses. This lowers your overall tax bill and might also boost returns.
Since Rebalance IRA is designed for retirement accounts, the lack of tax-loss harvesting is expected.
Rebalance IRA Robo-Advisor Pros and Cons
- Rebalance IRA works specifically with retirement accounts, but it can also work with a wide variety of other accounts, including taxable ones.
- Financial advice goes beyond retirement planning, and can help you with other money decisions, such as purchasing a home or planning for your children’s college educations.
Provides 401(k) assistance to help maintain a holistic approach to your retirement planning.
All accounts are held with Fidelity and Charles Schwab, two of the largest and most innovative investment platforms in the industry.
- Many available account types.
- The minimum account size is $100,000 which will exclude new and small investors.
- Tax-loss harvesting is not available. This disadvantage only applies to tax-able accounts,not retirement accounts.
- Rebalance IRA is high on fees. They charge a basic management fee of 0.50%, plus 0.20% for ETF expenses. This is much higher than other popular robo-advisors with access to live advisors like Betterment and Ellevest. Both of these robo-advisors offer financial advisors and lower fees.
- Flat fees apply, including $250 for initial set up, plus $50 to $70 for rebalancing, which takes place twice each year. These are not typically charged by other robo-advisors.
Rebalance IRA Wrap Up
One of the first features you’ll notice about Rebalance IRA is that the annual management fee is higher than typical robo advisors. But it’s important to understand that Rebalance IRA is not a typical robo-advisor. While it provides all the benefits you expect from an automated investment platform, it also offers a generous amount of live support from a dedicated financial advisor.
In this way, Rebalance IRA is much closer to a traditional human investment advisor. And in that regard, their fees are much lower than what you’ll pay for those services, in most cases. Meanwhile, you’ll also have access to your financial advisor for making non-retirement financial decisions.
This service is really a financial advisor with a robo-advisor component. It’s worth investigating if you’ve been looking for direct assistance with your retirement plans, but want more of a human touch than you’ll typically get from the average robo-advisor.
If you’d like more information, or you’d like to open an account, visit the Rebalance IRA website.
Personal Capital vs Betterment Comparison
|Overview||Goals-based digital investment manager and advisor-led robo advisor. All clients have access to Certified Financial Planners and cash management.||Personal Capital offers stellar free investment management tools. Their paid money management platform is comprehensive, and includes Certified Financial Planners for all.|
|Minimum Investment Amount||Digital-no minimum |
|No minimum for use of free financial and investment management tools. |
Personal Capital Advisors-$100,000
|Fee Structure||Digital-0.25% AUM|
|Zero fees for access to free investment management tracking & recommendations. |
Personal Capital Advisors fees decline as assets increase.
$1,000,0000-$3,000,000 .89% AUM down to
0.49% AUM for accounts over $10,000,000.
|Top Features||Digital and live investment management with CFP advisors. Socially-responsible, income and smart beta portfolios. Tax-loss harvesting. Cash management.||Paid feature includes access CFP advisor. Investment, financial account analysis, and recommendations, retirement planner, rebalancing, tax-loss harvesting, saving and spending tracker, retirement planner.|
|Promotions and Website||Free Betterment investment management promotion||FREE investment, saving, spending, retirement planning tools.|
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Disclosure: Please note that this article may contain affiliate links which means that – at zero cost to you – I might earn a commission if you sign up or buy through the affiliate link. That said, I never recommend anything I don’t believe is valuable.
Barbara A. Friedberg has an account with M1 Finance.
*For M1 Plus customers