Robo-advisor vs. financial advisor? You don’t have to choose

The Truist Touch

More options, more freedom. Here’s why it can pay to have both a human and a robo-advisor.

It used to be that you had two investment options: Do it yourself or enlist the help of a financial advisor. But in the past decade, a third option has emerged: robo-advisors.

Robo-advisors are investing services driven by artificial intelligence (AI) that use advanced algorithms to help manage your investments. They’re designed to make investing simple, automatic, and nearly effortless.

At Truist, we offer a fourth option—a hybrid approach to investing that combines the benefits of a robo-advisor with access to a human advisor.

While it might seem redundant at first, having both a robo-advisor and human advisor helps mitigate each one’s potential drawbacks. You can rely on the technology to manage your day-to-day investing—but still get curated guidance for your unique situation and goals.

Here are three times it can help to have both a human advisor and a robo-advisor.

1. Global events and market downturns

It’s no secret that markets can be volatile. Human disasters (like wars and pandemics) and financial crashes (like the Great Recession of ’08) make market peaks and valleys inevitable. And in moments of uncertainty, you might be tempted to sell stocks to cut your losses. But true investing is about the long game, not timing the market.

Another common investing mistake is letting your emotions guide your investments—but a human advisor can help you make more informed decisions. If stocks start to plunge, you can call your advisor. They’ll remind you that it’s a natural part of the economic business cycle and not to panic (and then they might coach you through some breathing exercises).

And while robo-advisors can’t give you that level of care and attention, they can do more functional work, like looking at your investments every day and making adjustments as needed to keep you on track.

2. Personal goal setting and achieving

If you want personalized guidance for your investments, there’s really no substitute for a human financial advisor. They can help you set goals based on your values, needs, and desires. And when you experience big life events, a financial advisor can understand and work with your complex needs.

But a human advisor can also work in tandem with a robo-advisor—especially if that traditional advisor offers robo-advisors as a service. After you discuss your goals and current situation with your advisor, you can direct the robo-advisor to invest accordingly, says Truist financial advisor Yanette Sullivan.

“If it feels you’re not on track for a specific goal, the robo-advisor will notify you,” Sullivan says. “A conversation with a live advisor can help you update your financial plan, and you can submit those updates to your portfolio so the robo-advisor can make that adjustment.”

When it comes to your goals, you can enjoy the ease of sophisticated technology backed by real humans. They’ll work together to balance your investments based on your needs.

3. When you need some advice

A robo-advisor can make informed investing decisions based on the information you give it. When you sign up for a robo-advisor, it will ask you questions about your risk tolerance, your time horizon, and how you’ll fund the account. But beyond that information, it can’t give you more personalized advice.

That’s where a human financial advisor comes in. They can go beyond the capabilities of a robo-advisor, providing sound guidance for your unique situation. So, if you have both, you might start investing with a robo-advisor as a baseline, but keep in contact with your human advisor when you have specific questions or need personalized advice.

The hybrid solution has become more popular as investors have recognized the benefits of having both. Truist Invest Pro, for example, gives you the best of both worlds—a Truist Invest automated investment account, with the added perk of unlimited access to a team of registered financial advisors.

Both robo-advisors and human advisors serve different purposes, so sometimes it can actually pay to have both. If you want to “set and forget” your investments—but still would like personalized guidance for your money—this hybrid solution might be right for you.

DISCLOSURES:

Keep in mind that investing involves risk. The value of your investment will fluctuate over time, and you may gain or lose money.

Investment Advisory services, including Truist Invest and Truist Invest Pro, are offered by Truist Advisory Services, Inc., a SEC registered investment adviser affiliate of Truist Financial Corporation.

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