Charles Schwab has announced plan to launch a new hybrid advisory service that combines advice from financial advisers with online advice to target mass affluent investors.
Dubbed Schwab Intelligent Advisory, the new service will offer clients a customized financial plan and ongoing live advice from certified financial planners, as well as an automated portfolio at a low cost, the company said in an press statement.
The service requires minimum investment of $25,000 and is expected to launch in the first half of 2017. Advisory fees under Schwab Intelligent Advisory are 0.28% of a client’s managed assets with a $900 quarterly fee maximum.
The service will charge no trading commissions or account service fees, the company noted.
The service will offer clients a customised dashboard that will enable them to view their plan, their progress toward goals, and portfolio performance – from both a desktop and mobile device.
Neesha Hathi, executive vice president with Schwab Investor Services, said: “There’s an entire population of self-directed investors who aren’t self-directed by choice – they simply haven’t found an advisory model that works for them yet. The barrier might be lack of trust and transparency, cost, complexity or general inertia, but there’s a real need to make financial planning and advice more accessible.
"Schwab Intelligent Advisory democratizes the process by making it easier and more affordable to build and maintain a plan, stay invested, and access professional guidance along the way.”