By MoneyBees
Compare robo-advisor fees in dollars: management fee tiers plus the TER of the funds each platform holds, over the same plan and years, with MAS's licence check.
Most charge a yearly management fee as a percentage of the money they manage, and the funds they hold charge their own expense ratio (TER) on top. MoneySense says to add the two for your true yearly cost. Check each platform's own fee page for its current rates.
The management fee plus the weighted average TER of the underlying ETFs or funds. A 0.8% fee on funds with a 0.2% TER costs about 1% of your balance a year. Ask about withdrawal fees and lock-ins too.
S$10,000 plus S$500 a month for 20 years at 6% a year grows to about S$264,122 with no costs. At a 1% total cost it ends near S$232,643, about S$31,500 less. Fees come out every year, so you also lose the growth on them.
Some platforms charge a lower rate once your balance passes a level. In this calculator the lower rate applies only to the part above the tier. If a platform charges one rate on the whole balance, enter that rate as the management fee.
Buying ETFs yourself skips the management fee, but you pay brokerage and must rebalance on your own. Enter 0% as the fee and your ETFs' TER as Option C to compare, then add trading costs with the brokerage fee calculator.
Search the platform's name on MAS's Financial Institutions Directory at eservices.mas.gov.sg/fid. Robo-advisers in Singapore must be regulated by MAS. MoneySense says not to invest through one that is not on the list.
MoneySense says the ETFs you own are held in custody apart from the platform's own assets, so the company's creditors cannot take them. They are not covered by deposit insurance, and their value can fall with the market.
Some platforms accept CPFIS or SRS money and others do not. Check each platform's own terms before you sign up.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).