In the world today, technology is playing an ever-increasing role. Some people choose to embrace this change and use tech to drive innovation, while others feel threatened by it and prefer to stick with the “old” ways of doing things. Technology can even help us make our investment decisions by using robo-advisors to assess our investment requirements and build a personalised investment portfolio.

So, the question is, what do we need to know about robo-advisors before we invest money with them? And what are some of the benefits of using these advisors as opposed to a traditional financial advisor?

Robo-advisors have been around since 2008, when Betterment launched, and have become a hot topic in the investment space. They offer a third avenue for people to consider investing in their futures – the other two being traditional advisors and DIY investing.

Grant Locke, head of CN&CO partner OUTvest, recently wrote an article for finweek titled “Reduce the cost of investing without becoming a bore at parties.” In the article Grant expands on what robo-advisors actually are, how to pick the good ones and unpacked the fees of a Robo-advisor compared to your traditional financial advisor.

Grant says, “It’s good to have control of your investments, but it takes lots of time and effort to create investment solutions that find the right balance between return, diversification and cost efficiency.” This is where a robo-advisor can help you as an investor, allowing you focus on your investment goal rather than selecting the right investment product to help you achieve it.

“But before you decide to put all your money into a robo-adviser, make sure it actually gives advice – both upfront and ongoing – and that this service is included in the costs,” he says in the article. This is a useful tip that can be applied across the board… make sure you have a basic understanding of what you are using/signing yourself up for.

Tech is powerful and we can make use of it in a number of ways. Robo-advisors provide another example of how technology can help people, reduce costs and provide access to quality investment advice at a fraction of the cost.