The fintech space is getting crowded. Mint, Personal Capital, Stash, Acorns, Simple… you name it, and there is an app or website for whatever flavor of personal finance action you want. Well, there are two new products in town that are threatening to change the game.
Albert, a standalone account aggregator, offers financial health scores and easy ways to start investing and saving. Benjamin, a product of Wela, is a personal advisor that shows promise but still needs some finishing touches. I spent some time examining the apps, testing their accuracy, and even talking to the people who make it happen at these fintech companies. So who wins in a head to head matchup between Albert and Benjamin?
The Albert aggregator consolidates all of your account information, then uses that data to calculate a financial health score. The simple interface shows your score breakdown and notes any red flags on financial problems you may not be tracking.
Your financial health score is the first thing you’ll notice after you link your various financial accounts. When Albert analyzes your finances he looks at four categories: savings, investments, debt burden, and fees and rewards. Based on your overall financial performance, you’re awarded between zero and 100 points.
Your savings score is based on a 35-point scale, and takes two factors into account: spending less than you earn and having money available for an emergency. Albert will calculate your emergency scores based on your cash in savings, checking, and brokerage accounts, then subtract one month’s worth of bills. The savings x-ray looks at your income and spending for the last three months, savings as a percent of income, and then adds an Albert savings (coming up later) to the amount. Because the app wouldn’t recognize my savings, I’m red in this category. I had no option to re-categorize transactions as savings-related either.
Your investment score makes up the next 15 points of your overall score. It looks at the total amount of money you’ve invested, and whether you have the proper investment accounts. Al considers having both a retirement account and a brokerage account as “important steps in building long term wealth.” The total invested portion of your score looks at whether you have met the investment target for your age group. For me, I’m supposed to have saved a little over a year’s worth of income by now. I’m at 89% of my age target.
Debt burden is a big chunk at 35 points on the health score. Debt vs Income and Credit Card Debt are the two categories they examine. They want you to keep the debt-to-income ratio at less than half your annual income (or 50%). For credit cards, their goal is for you to be at zero and pay no interest. If your interest payments are above $30, you’ll get a reduced score.
Fees and Rewards examines banking fees and credit cards fees to assign you up to 15 remaining points on your financial health score. Paying zero in ATM Fees, Foreign Exchange Fees, account maintenance fees, and overdraft fees will keep you in the winner’s circle. Credit card fees such as late fees and membership fees will take away points, if they show up on your ledger.
Benjamin is a virtual financial advisor brought to you by Wela, a Fintech startup that wants to help you manage your money and investments. Like Personal Capital and Mint, you’ll enter your banking, retirement, and loan accounts into the Wela system to accurately calculate your net worth and asset allocations.
Broadly, Benjamin looks at your overall cash flow, along with your Debt Zero, Emergency Reserve, and Retirement goals. It then provides a calculator to breakdown each goal, listing out how much money you should save each month to reach your goals in the time you specified. Ben will let you know if you’re on track to meet your goals and how many months or years it will take to achieve them. You’re also given a “Daily Spend Limit” that breaks down how much you can afford to spend each day, and still maintain your savings goals.
Your Cash Flow is a calculation of what you earn versus what you spend. You’ll initially need to mark transactions as spending, income, or savings to let Benjamin learn what goes where. After the categorizing them, though, you’re good to go on similar future transactions.
The Debt Zero goal clarifies how healthy your debt-to-income ratio is, and how long it should take you to reach your goal. Benjamin gave me an approved debt level and, based on my cash flow and other goals, a “Goal ETA.” I could adjust this goal based on how much of my debt I want to pay off each month.
In Benjamin’s LEARN WHY section, he explains that you should have a “credit card balance of 50% or less, relative to your monthly income.” This is in line with the Wela philosophy of TSL: Spend 30% of your income on taxes, save 20% for retirement, and live off the remaining 50%. This means if you have less than 50% of your monthly income in credit card debt, you could conceivably pay it all off in one month. That is how he calculated my approved debt amount.
Benjamin’s Emergency Reserve philosophy goes by the rule of thumb that you should have 3-6 months of living expenses set aside for emergencies. Ben calculated that at my current spending and contribution amount, it would take me almost two years to reach my savings goal. Yikes! Don’t be discouraged, you can change the timeline based on your desired savings input. You can track all of your goal progress by manually inputting the saved amounts, or automatically, through the account linking feature of Wela.
The Retirement button is simple, but I had a hard time getting the results to match up with the Wela interface. Ben said I would need a significantly smaller amount of money for retirement than what Wela had in mind. Like the other goal options, you’re able to adjust the time, monthly contribution, and current balance status of the Retirement section. You cannot, however, adjust your projected rate of return or calculate the impact of inflation. I imagine Ben will adopt this feature sometime soon.
You can add as many goals as you like. The breakdown option, listed below your goals, lets you tweak how much you want to save each month for your goals. This is a great way to play the what-if game with your financial future. You can quickly determine what it will take to accelerate your goals to meet any timeline you choose. You’ll also be reminded of your daily spend limit, as well as see a total sum of what you should be saving monthly to meet your goal timelines.
Benjamin offers periodic insights on your financial life. After holding an account for a few weeks, though, I’ve yet to receive any comments from Ben.
Benjamin’s in Beta
You should know that Benjamin is still in the beta phase. This means there could be software bugs and features that aren’t quite ironed out. Eventually Wela will iron out the kinks with this product, leaving minimal errors for the user to discover.
So how do they differ, and which one is better? Let’s do a side-by-side comparison. I’ll incorporate some info from both Wela and Benjamin when making the determination of which is the better financial tool in the Albert vs. Benjamin match-up.
Saving and Investing
Albert will help you save, and Benjamin will help you invest.
Through its parent company, Wela, Benjamin users can invest with the help of a dedicated advisor. They offer an exchange traded fund (ETF) balanced portfolio that will be adjusted when necessary. You’ll have the help of advisors that hold either a Certified Financial Planner (CFP) or a Certified Financial Advisor (CFA) qualification. Additionally, you’ll get an annual review from your dedicated personal advisor.
Albert offers an FDIC insured savings account through their app interface. If you open an Albert savings account, the company will analyze your spending and income, and harvest savings from your checking account. It’s similar to Acorns and other penny rounding savings programs, but Albert promises to only save what they think you can spare. Transfers to and from the Albert savings account are free.
You can still invest through Albert, but not with him. When you set up the investment section in Albert, you’ll notice you have the option to open a new account. Depending on what type of account you want – brokerage or retirement – your options expand from there.
Users can open either a Roth or Traditional Independent Retirement Account (IRA) with Fidelity or Betterment. For brokerage accounts, which are not tax advantaged, your options include selecting either a self-guided or automatic option. This determines what type of account they think you’ll need.
Albert picked the firms they felt were the easiest to use, had the best offerings, and lowest overall fees. Based on that criteria they chose Betterment, Robinhood, and Fidelity.
Of the two, I think Benjamin will have the edge in the future but Albert offers immediate access to staring a new investment or savings account.
They’ll both Support You
Before I even initiated contact, Walt, an advisor at Wela, messaged me to help resolve issues I was having with linking my accounts. I couldn’t get my bank login to work, so the team at Wela wanted to see what they could do to help. They stayed attuned to my concerns and I was able to quickly resolve the issue. That’s a sign of good customer service – and it means they notice when their software is acting up. Benjamin and Wela have a human on the other end of the line to answer if anything is out of the ordinary.
Albert sent me a text message when I signed up for the mobile app. He’s saved as a contact in my phone, and I can text him any time I have a question about my account. I sent Al a message over the weekend – but he said he was recharging and would get back to me on the upcoming Monday morning. Sure enough, he answered my question by noon, as promised.
After prodding him a little, I discovered he’s a live human on the text line. However, “support is limited to helping users with technical issues in the app.” No personalized investment advice as of yet, but we did have some long conversations about quirks in their views on savings vs spending.
More than a Robo Advisor
I’ve never sat down with a financial advisor to review my personal finance plan. Benjamin gave me an opportunity to do that through Wela. I requested a free 20-minute consult with one of their advisors, which was great. We ended up spending about 30 minutes discussing my debt management and retirement plan.
Using a free web broadcast software, we looked at some slides and talked over the main points of their investment philosophy. The key behind their formula is to be cash-flow positive, debt-free, and have an emergency savings safety net. It was a very positive experience and I’d recommend it to anyone who has never met with a financial advisor.
Albert doesn’t offer personal financial advice. They do, however, want to make you aware of your “financial blind spots” that you may not realize are there. Albert will never be directive and tell you to do something. He will let you know if you’re getting ripped off with credit card membership fees, though. Or he’ll point out that you have a large savings account, but no retirement account.
Benjamin Could Cost You
If you choose Wela and Benjamin as your investment advisor, you’re going to pay advisor fees. For those who invest less than $250,000, you’re charged 1% annually. The fees drop down to 0.90% for $250k to 500k, and 0.75% for up to $1,000,000. You’re also going to pay for any underlying expenses with the ETFs in your portfolio.
Overall, a 1% flat fee is not bad, but you can do better. Consider that this fee does cover a real human’s salary and expenses. So, you’re paying for the privilege of working with a professional advisor.
Albert will not charge you fees. However, you could pay fees based on which investment company you select, be it Fidelity, Betterment, or Robinhood. Remember that even Al can’t escape the tyranny of underlying fees.
Because of the low fees associated with their preferred investment companies, Albert takes the win on this category.
Unfortunately, users of either service face limited access issues. Albert is only available on iOS platforms. Benjamin is a feature of your Wela account, which is a web-based application that you can access on your smartphone. No word yet on when either service will be available elsewhere. You can request early access to Albert on the Android here. You’ll also get a text message when the app goes live.
What modern fintech startup would be complete without a blog? Wela has a blog and newsletter. Here you can read articles on investing, retirement, saving, and more.
Albert has a video and some tidbits on their website, but that platform is strictly aimed at getting you to download their iOS application.
The Overall Winner
Both of these applications are useful tools to make you think intelligently about your financial situation. I am impressed with Benjamin’s parent company, and how they took the time to reach out to me when my account had issues. The free consultation I had with their advisor was straightforward, and their investment strategy is solid. Albert will keep you on your toes, too. And if you’re a Type A personality like me, you’ll want to max out that financial health score you’ve earned.
While they can’t give you pointed advice, they’ll spur you along on the path to financial freedom. Their partner offerings, like investing with Fidelity or saving with Wells Fargo, are easy to start using.
They’re both great products, and I can’t say one is better than the other because they offer different things. And…They’re tied on my score chart.
If you want a no frills, no human interaction robo-advisor go with Albert. If you want an up-and-coming investment advisor firm, that pairs the technology of today with the expertise of a human, use Benjamin and Wela to get your goals on the right track.
Have you used either of these tools? Let us know how they’ve helped (or hurt) you in the comments below.Topics: Money Management