Ellevest Review

It’s no secret that men and women often have different habits and needs. The same holds true for career choices and lifespans. So, why not take those differences into account when it comes to designing an investment strategy? That’s the question Ellevest aims to tackle.

But what is Ellevest? How does it work? Is it safe? How does it stack up against other services like Personal Capital or SmartAsset? And, most importantly, should you use it? Our Ellevest review will answer all these questions and more.

What Is Ellevest?

Ellevest is an investment platform geared towards women. By taking into account the different financial trajectories of most women vs. men, Ellevest provides financial advice that better fits each gender.

As a robo-advisor, Ellevest mostly uses algorithms and automation to help you invest. Even though this lacks the level of communication you’d find with an in-person advisor, in most cases, it’s a lot cheaper.

But, Ellevest offers more than just robo-advising. You can also purchase meetings with CFPs on either an annual basis or a per-session one. These CFP meetings make Ellevest somewhat of a hybrid between traditional financial planning and robo-advising.

How Does Ellevest Work?

Ellevest’s robo-advising works on a subscription basis. You pay a monthly fee of $1 – $9 per month, with different levels of service available depending on the subscription tier.

There are three different subscription levels, called “memberships.” The lowest tier is Ellevest Essential, which only includes individual taxable accounts (no IRAs or joint accounts). Ellevest Essential also gives you a 20% discount on any CFP meetings.

The middle tier is Ellevest Plus, which has individual taxable accounts and IRAs. You also get an increased 30% discount on any CFP meetings and an investment plan that accounts for any retirement accounts not held with Ellevest.

These added features, especially the ability to invest in IRAs, are much-needed. With these additions, Ellevest helps make itself a more legitimate platform for long-term investing.

One other important note is that Ellevest also has a team dedicated to walking you through setting up and transferring over an IRA. You can even get advice on what to do with a 401(k). This is very useful for a new and less experienced investor, as they’ll get advice from experts.

The highest available tier is Ellevest Executive. In addition to the previous features, you can now set several investing goals and divide your accounts to each focus on different ones.

This can come in handy if you want one account dedicated to buying your first home and another focused on building retirement savings.

Ellevest Executive also gives you a 50% discount on any CFP meetings.

Depending on which tier you choose, you’ll have access to different features. However, all three provide valuable educational resources and coaching, as well as goal-based investment strategies.

The amount of help offered when it comes to teaching you how to use and manage your accounts makes Ellevest a great platform for someone inexperienced with managing money.

What Makes Ellevest Unique?

Ellevest’s unique selling point is its focus on women’s needs as investors. Using data on women’s income and work habits, Ellevest’s investment strategies adjust for lower average earnings and longer lives.

With these changes to the traditional model, Ellevest has the potential to be a more effective investment platform for women.

Note: Ellevest is not strictly for women. Men are allowed to use their service too. If you’re a man and decide to use Ellevest, they’ll take into account average men’s income and work habits to build a similarly personalized investment strategy.

Ellevest’s CFP services also make them unique. And, as an added bonus, you don’t actually need a membership with them to use their services. However, it’s a lot cheaper if you are a member.

Either way, it’s another step towards making CFPs a more accessible tool for the average person.

Pros & Cons Of Ellevest

Ellevest Pros

• Provides a gender-specific approach to investing
• Multiple subscription tiers provide flexibility in pricing
• $1 minimum account balance
• Personalized portfolios that mostly invest in ETFs
• Automatic portfolio rebalancing
• Makes CFPs more accessible
• Simple UI
• Useful educational resources

Ellevest Cons

• Lack of account options (no joint accounts, trusts, or 401(k)s)
• Doesn’t use tax-loss harvesting
• Inability to make significant changes to your portfolio

How Much Does Ellevest Cost?

As we mentioned earlier, Ellevest has three different subscription tiers. We already went over which tiers have what features. So, let’s now talk about pricing for each one. 

The cheapest option, Ellevest Essential, costs only $1 / month. While this is relatively cheap, there are still cheaper alternatives out there that offer more features.

The mid-tier option, Ellevest Plus, costs $5 / month. And the most expensive option, Ellevest Executive, costs $9 / month.

With subscription costs out of the way, let’s discuss the prices for CFP meetings. You can schedule these on a per-meeting basis. Or, you can buy unlimited yearly access.

If you don’t have any subscription, one 30-minute session with a CFP costs $150. Or, you can get unlimited yearly access for $675.

If you have Ellevest Essential, one 30-minute session with a CFP costs $120. Or, you can get unlimited yearly access for $540. 

If you have Ellevest Plus, one 30-minute session with a CFP costs $105. Or, you can get unlimited yearly access for $473. 

If you have Ellevest Executive, one 30-minute session with a CFP costs $75. Or, you can get unlimited yearly access for $338.

Is Ellevest Safe?

The short answer is, yes. Ellevest not only provides SIPC insurance, which covers up to $500,000 in securities or $250,000 in cash, they also have additional SIPC insurance. This extra insurance covers up to $10,000,000, so your funds are extraordinarily safe.

While a security breach is always possible with any company, Ellevest encrypts your personal data and has two-factor authentication. This means using Ellevest to invest involves minimal risk.

How Does Ellevest Make Money?

Ellevest makes money through its monthly subscription services and its paid CFP appointments. They do not charge any additional management fees, so your costs are all transparently shown upfront.

How Is Ellevest’s Customer Service?

You can contact Ellevest’s customer service via phone from 9 am to 6 pm ET. If you’d rather text, Ellevest’s customer service also supports texting during the same hours.

This flexibility is great to see, as nuanced issues are usually best explained over the phone or via text.

For more standard or common problems, I found Ellevest’s FAQ section sufficient to answer most of my questions.

What I Wish Was Different About Ellevest

Honestly, I’m not a huge fan of investing platforms that use flat monthly fees. Yes, these can be cheaper for accounts with thousands of dollars. But for the average person, flat fees often end up costing a lot more than percentage-based ones.

Let’s use Betterment as a point of comparison. Betterment charges 0.25% annually, while Ellevest costs $12, $60, or $108 each year, depending on the tier.

If your account has $1,000, Ellevest will end up costing 1.2%, 6%, or 10.8% of the total account value. Compare that to Betterment’s 0.25%. Put into dollars, this is the difference between paying $2.50 a year vs. $12 – $108. And this difference only worsens as you use smaller amounts.

That said, if your account has at least $5,000, $12 a year in charges works out to 0.24% of the total account value. If your account has at least $25,000, $60 a year for Ellevest Plus becomes 0.24%. And, if you have Ellevest Executive, you’d need at least $45,000 for Ellevest to be cheaper than Betterment.

So, if you’re using thousands of dollars, it may be cheaper to use Ellevest (assuming you don’t care about some of the other services offered by different brokerages). But as you’re just starting out, it’s cheaper to use another service like Betterment.

How Does Ellevest Fare Against Competitors?

We’ve already talked about how Ellevest’s fee structure fares against its competitors. But, what about their features?

When it comes to educational resources, Ellevest has several useful resources. And, the available information isn’t just limited to investing. In fact, Ellevest has tips on everything from how to budget to how to widen your job search.

Also, Ellevest’s account and investing minimums are great. By having $1 and $0 minimums, Ellevest helps make getting started easy. This removes many of the barriers to entry for would-be investors.

One of the areas where Ellevest doesn’t quite measure up is portfolio customization. Ellevest lets you adjust the level of aggression in your portfolio (similar to Acorns).

But, they offer little in the way of controlling specific assets. Instead, you’re stuck with the ETFs they offer you. If you’re a hands-off investor, this may not be that big a deal to you. But for someone who wants to be more engaged, you may want to look elsewhere.

In terms of ease of use, Ellevest is incredibly easy to get started on and to use. They stack up well against even the best robo-advisors. Here’s a more in-depth breakdown of how to make an Ellevest account.

How To Get Started On Ellevest

When you first create an Ellevest account, you’ll need to put in some basic information. This includes your name, zip code, and email address (which you’ll have to verify). 

Then, you enter demographic information (age, marital status, gender, number of kids, etc.). Once you’re done filling this out, it’s time to pick your investing goal.

Note that the standard subscription only lets you choose a single goal, while Plus and Executive let you pick several.

After selecting your investment goals, you’ll receive a portfolio with a recommended asset allocation, mostly made up of ETFs.

Then, you’re done! The process only takes a few minutes to complete.

Should You Use Ellevest

Ultimately, Ellevest is best for someone who wants to take advantage of their educational resources and wants an investment strategy tailored to combat gender-based differences.

But, the subscription-based pricing system makes Ellevest more expensive than other robo-advisors currently available. If you want to experiment with picking your own investments, you may also find another service best.

That said, for the hands-off investor who wants to focus on accounting for differing lifespans and average incomes, Ellevest is a great choice. 

The ability to schedule meetings with CFPs also makes Ellevest well worth checking out, even if you don’t ever get a subscription.