Wealthsimple vs. BMO Smartfolio – 2025 Comparability

At first look, a contemporary fintech firm like Wealthsimple and a longtime monetary large like BMO couldn’t be extra totally different. But, with the brand new push to index investing during the last decade, each monetary establishments have managed wealth platforms that we ranked in my Greatest Robo Advisors in Canada listing. In fact, in addition they embody on-line brokerage choices as effectively, however these have slid down my listing of the Greatest On-line Brokers in Canada.

Selecting the best DIY investing platform can really feel like a frightening activity, particularly once you’re weighing charges, options, and total worth. That’s why we’ve put collectively this side-by-side comparability of Wealthsimple Make investments and BMO Smartfolio, in addition to Wealthsimple Commerce and BMO Investorline. Our aim is that can assist you reduce by the noise, perceive the variations, and see how every platform stacks up.

By the point you’re completed studying, you’ll have a transparent understanding of what every platform brings to the desk. We additionally advocate testing how our high rated robo advisor stacks up in our Justwealth Assessment, and the way our high price brokerage account compares in our Qtrade Assessment.

Wealthsimple Make investments vs BMO Smartfolio: Fast Comparability Chart

Whereas we advocate studying our Wealthsimple Assessment and our BMO Smartfolio Assessment for extra context, we’ve summed up the necessary information right here:

		Wealthsimple Managed Investing
		0.2%-0.4% For 500k in Belongings
		0.12-0.15% For Commonplace ETFs
		13 ETFs (10 normal, 2 SRI, 1 Halal), quite a lot of high suppliers.
		A alternative of 9 portfolios (3 normal, 3 SRI, 3 Halal)
	RRSP, Spousal RRSP, TFSA, RRIF, Spousal RRIF, RESP, unregistered	RRSP, Spousal RRSP, TFSA, LIRA, RRIF, LIF, RESP, unregistered
	1.25% to six.39% annualized development	1.96% to five.54% annualized development
	CIPF safety as much as $1 million + Financial institution-level encryption	CIPF safety as much as $1 million + Financial institution-level encryption
	Simple to entry (human) advisors	Simple to entry (human) advisors
	Loans and features of credit score

Wealthsimple vs BMO: Comparable Service, (Very) Totally different Establishments

Wealthsimple is a Fintrac-registered cash providers enterprise that was based in 2014 with its robo-advisor service, Wealthsimple Make investments, as its flagship product. It has since branched out into DIY investing with Wealthsimple Commerce and cryptocurrency investing with Wealthsimple Crypto. 

Although it’s a lot newer, Wealthsimple nonetheless has over 1.5 million clients and over $15 billion in belongings below administration. They provide various providers along with their robo-advisor, together with: 

• Wealthsimple Spend (which features like a checking account)
• Wealthsimple Tax (a tax submitting platform)
• Wealthsimple Crypto (a crypto buying and selling platform)
• Wealthsimple Commerce (a reduction on-line brokerage – extra on this close to the tip of this text). 

Evaluate that to BMO, which was the primary financial institution in Canada (based over 200 years in the past) and has over $332 billion in belongings below administration. 

BMO pioneered huge financial institution robo-advisors when it launched Smartfolio in 2016. Different banks are progressively following, however up to now the one different established robo is RBC Investease, which we featured in our Wealthsimple vs RBC comparability).

BMO prefers the time period “on-line portfolio administration” over “robo-advisor” as a result of they focus closely on human interplay. Their portfolios are actively managed by a staff of Portfolio Managers and rely a bit much less on laptop algorithms than their competitors.

From what we’ve seen, there’s no indication that the private administration facet makes an enormous distinction in efficiency, however consider it as the massive financial institution contact (one that you simply pay additional for). 

Wealthsimple vs. BMO: Safety

Each Wealthsimple and BMO Smartfolio are legit, regulated robo-advisors. Your accounts are held by custodial brokers that are members of the Canada Investor Safety Fund (CIPF) and controlled by the Funding Business Regulatory Group of Canada (IIROC).

Each take information safety significantly. They use bank-level encryption and firewalls at each degree. You possibly can belief every firm to guard your info in addition to your cash.

Wealthsimple vs. BMO: Annual Charges

One main distinction between Wealthsimple Make investments and BMO Smartfolio is the payment construction. BMO’s is a bit difficult, so we’re going to interrupt it down with a real-life instance so you’ll be able to see what the pricing means for you.

BMO fees charges in keeping with the next tiers:

• 0.7% for the primary 100K
• 0.6% for the following 150K
• 0.5% for the following 250K
• 0.4% for over 500K

But it surely’s much more difficult than that as a result of their payment construction is cumulative.

For instance, in case you have $250,000 to speculate, your whole charges appear to be this:

$100,000 x 0.7% = $700 + $150,000 x 0.6% = $900

$700 + $900 = $1600 to handle that $250,000.

In the meantime, Wealthsimple fees a straight proportion of the account (0.5% for accounts below $100,000 or 0.4% for bigger accounts). This pattern $250,000 account can be charged a flat 0.4% payment.

$250,000  x 0.4% = $1,000. That’s a steep distinction!

BMO is fast to level out that their charges are decrease than a typical (1.75%) conventional investing payment – and that’s true, at 1.75% you’d be paying $4,375. But it surely’s nonetheless 60% greater than you’d pay with Wealthsimple Make investments, and within the case of our instance, that’s $600 that might be going into your pocket (or again into your funding account). 

Wealthsimple vs. BMO: MER

Any ETF has a administration expense ratio – a administration payment that’s charged behind the scenes and is expressed as a proportion of the whole funding. MERs can fluctuate extensively – and within the case of Wealthsimple Make investments and BMO Smartfolio, they do!

Wealthsimple’s normal ETFs have an MER of 0.12-0.15%, which is extraordinarily low in comparison with trade requirements. The MERs for his or her socially accountable funding (SRI) ETFs vary from 0.21-0.23%, whereas the MERs for his or her Halal ETFs vary from 0.25-0.5%.

BMO’s MERs sit between 0.2% and 0.35% – on the excessive facet of regular for ETF MERs on the whole, however about double Wealthsimple’s normal ETF MERs.

Wealthsimple vs BMO: Extra Charges

Wealthsimple Make investments doesn’t cost switch charges or withdrawal charges. The truth is, should you switch over $5,000 in investments to Wealthsimple, they’ll reimburse you for the incoming switch payment. They do cost a 0.4% overseas change payment, however that’s actually it.

In the meantime, BMO fees a bunch of extra charges together with:

• Switch-out of a Non-Registered or Registered Account (Full and partial) ($135)
• Partial withdrawal of a Registered Account (excluding TFSA and RRIF accounts) ($25)
• Full Deregistration of a Registered Account (excluding TFSA and RRIF accounts) ($100)
• Cheque requests ($10)
• Paper assertion requests ($5)
• International Foreign money Conversions (1.8%)

We’re not followers of charges for each little factor, so we take into account this in depth menu of fees to be some extent in opposition to BMO.

However we get it – BMO is a conventional financial institution, and that is what (many) banks do.

Wealthsimple vs. BMO: ETF Choice

As a result of Financial institution of Montreal is an ETF supplier, it’s not a shock that their Smartfolio service builds its portfolios out of BMO ETFs. They’re acknowledged as one of many high ETF suppliers, so this isn’t a horrible factor.

Nonetheless, we query the tactic of limiting portfolios to a single ETF supplier. There are numerous wonderful ETFs accessible from different suppliers, together with most of the Greatest Canadian All-in-One ETFs and Greatest Dividend ETFs in Canada.

A typical portfolio from Wealthsimple consists of ETFs from Vanguard, iShares, and BMO, which provides them a a lot wider subject of candidates to select from. We’re undecided if this explains why BMO doesn’t supply socially accountable funding portfolio choices…however we do assume it’s necessary to level out that they don’t.

Wealthsimple has SRI choices, however should you favor an enormous financial institution expertise, take a look at RBC Investease, which provides them as effectively.  

Wealthsimple vs. BMO: Portfolio Choices

BMO provides 5 fundamental portfolio templates from Capital Preservation (lowest threat) to Fairness Development (most aggressive). Smartfolio portfolios are managed by a staff of Portfolio Managers and Credited Monetary Analysts who monitor every portfolio every day.

Wealthsimple Make investments has 3 fundamental portfolio templates: Conservative, Balanced, and Development for his or her normal, SRI, and Halal portfolios. Inside these 3 primary kinds of portfolios, they regulate asset allocation primarily based on a risk-tolerance scale of 1-10. Wealthsimple does have Portfolio Managers on employees, however the impression we get from their advertising is that the algorithms deal with a certain quantity of the day-to-day particulars.

We’re not saying that as a knock in opposition to Wealthsimple, for the file. They’re our most really helpful robo-advisor, so clearly, we expect they’re doing a wonderful job. And administration by algorithm is just about the purpose of robo-advising within the first place.

Wealthsimple vs BMO: Account Choice

Each Wealthsimple Make investments and BMO Smartfolio supply the next account choices:

• RRSP
• TFSA
• RRIF
• RESP
• Unregistered

Wealthsimple additionally provides spousal RRSPs, LIRA, and LIF accounts.

Wealthsimple vs. BMO: Efficiency

Annualized returns are a problematic metric for selecting a robo-advisor. Markets change always, and variations in efficiency typically don’t have anything helpful to disclose concerning the high quality of the platform.

Nonetheless, should you’re fascinated about BMO Smartfolio’s efficiency, they put their numbers entrance and centre on the pages for every portfolio.

Wealthsimple shares our opinion of the effectiveness of efficiency monitoring – however the numbers are there should you dig for them. BMO’s annualized returns presently vary from 1.25% to six.39% returns whereas Wealthsimple ranges from 1.96% to five.54%.

Once more, be warned: this implies subsequent to nothing out of context—these numbers are about half what they have been in 2021, and but we’re nonetheless recommending these advisors as a result of investing is a long run sport they usually can’t be blamed for the declining state of the market in 2022.

The perfect factor you are able to do once you’re choosing a robo-advisor is pay much less consideration to the annual returns and extra consideration to the options and providers. Choose the one which works greatest for you, make investments your cash, and depart it alone. It’ll all even out over time.

Wealthsimple vs. BMO: Signal-up

Signing up for each Wealthsimple Make investments and BMO Smartfolio is simple:

• You reply some questions to find out your funding targets, timeline, and threat tolerance
• You enter some fundamental private info
• You fund your account.

If you wish to add recurrently to your account stability, each Wealthsimple Make investments and BMO Smartfolio help you arrange recurring auto-deposits.

Wealthsimple vs. BMO: Minimal Steadiness

Wealthsimple lets you start investing with as little as $1. BMO Smartfolio requires a minimal stability of $1,000.

This isn’t unusual – different robo-advisors like Nest Wealth and ModernAdvisor have the identical requirement. But it surely’s at all times good when an organization like Wealthsimple makes investing accessible to everybody, no matter whether or not they have $1,000 of their account.

Wealthsimple vs. BMO: Perks

A part of Wealthsimple’s tiered pricing is tiered perks. Buyers with over $100,000 in belongings obtain not solely a reduction but in addition options comparable to customized monetary planning and tax-loss harvesting. Buyers with over $500,000 obtain much more perks, together with a customized monetary plan and 50% off medical health insurance for residents of Ontario.

BMO mechanically has a sure status connected to the identify… however they don’t supply any concrete perks to go together with it.

You understand how we really feel about perks (we’re for them—until they’re appearing as an alternative to a top quality robo-advising service).

Wealthsimple vs. BMO: Out there Promotions

Wealthsimple Make investments is providing our readers a welcome bonus: $50 money should you open an account and make investments $500.

Wealthsimple vs. BMO: Cellular App and Web site

BMO Smartfolio doesn’t have a standalone app, but it surely does have a streamlined and intuitive on-line platform. It provides you all the knowledge you want, from a chicken’s eye view to particulars of 1 particular holding.  

Wealthsimple Make investments has its personal app, which can also be streamlined and simple to navigate. You possibly can view your asset allocation, monitor your efficiency, and phone Wealthsimple’s funding staff.

Whereas each platforms are well-designed and intuitive, we do give additional props to Wealthsimple for including a cellular app to a wonderful browser-based platform.

Wealthsimple vs. BMO: Buyer Service

Wealthsimple has a staff of Portfolio Managers and assistants accessible by cellphone, electronic mail, app, or Skype throughout enterprise hours every single day. Likewise, BMO has a staff of Smartfolio Advisors accessible by chat, cellphone, or electronic mail.

Each corporations dedicate groups of actual folks to creating positive you get the enable you want. And that’s, frankly, priceless (though paying much less is at all times good!).

Wealthsimple Commerce vs. BMO Investorline: Self-directed Buying and selling

Financial institution of Montreal and Wealthsimple each supply self-directed, DIY buying and selling choices in addition to robo-advising. Wealthsimple Commerce is among the few no-fee platforms in Canada and BMO Investorline is understood for its stellar customer support.

We’ve laid out the key options face to face for simple comparability: 

Whereas we love Wealthsimple Make investments, we frankly discover Wealthsimple Commerce underwhelming. It’s free to make use of, however they make their revenue by promoting information and skimping on customer support. We additionally don’t love the buggy platform. And whereas BMO is extra useful and has extra selection, they cost you a quarterly payment, plus $9.95 for many trades. Neither is good.

If DIY investing is extra your scene, we advocate taking a look at Qtrade or Questrade as a substitute of both BMO or Wealthsimple. They’re extra useful and have higher customer support than Wealthsimple whereas offering higher worth than BMO. 

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