How to Invest Using WiseBanyan

So you are now at the point of saying not only does robo-advising seem right for me, how do I take the plunge? Read on to find out how to invest using WiseBanyan.

WiseBanyan fee free financial advice

As you will know from previous Wealth-Hack articles (how much can I earn investing with WiseBanyan and compare robo advisors with saving your money in the bank), we feel WiseBanyan is a great robo-advisor. They make it quick and easy to learn some of the fundamentals and gain confidence. However, there are factors to consider before you start building for your financial future. Read on to find out the answer to the question, ‘how to invest using WiseBanyan?’.

Robo-Advisor: Investing Fundamentals:

Before setting an account up and investing in your future, it is always wise (no pun intended) to ask yourself some important questions. If you answer these in advance, the process required to automate your investing is super simple. Let’s dive into each of these questions:

What are my Financial Goals?

The big things in life typically require money. Be it taking a gap year to travel, getting married, buying a home or retiring early. Regardless, money is typically a big component and our generation, in particular, has limited trustworthy sources to help financially plan for these events. That’s why you are here, right? The prospect of making your money work for you has intrigued you to the point you are considering how to use a robo-advisor to help you achieve x.

Being clear about x is important as robo-advisors like WiseBanyan are ideal for longer-term goals. More thinking time before you invest should be required for shorter term goals. Let me give you some examples before explaining why:

Long-Term Goals:

  • Retire early (a long-term goal for all but the most affluent millennials).
  • Taking a gap year to travel in 5 to 10 years.

Mid-Term Goals:

  • Saving up to achieve a 20% deposit for your first home (a mid-term goal for most with a low disposable income).
  • Buy a car outright.

Short-Term Goals:

  • Pay off high-interest debt (fingers crossed this can be accomplished shorter term!).
  • Large vacation or wedding.

But which goal duration(s) work best for robo-advisors?

Modern Portfolio Theory

Robo-advisors work on the principle of the Modern Portfolio Theory. For most of us, this means passive investing, investing in lots of things (diversification) and starting sooner than later. Starting sooner than later, a wonderful thing for Team Millennial! What this also means is if your financial goal is longer term, you stand a better chance of a great outcome from a robo-advisor such as WiseBanyan.


long term growth small

To be clear, you can still get a positive outcome shorter term. However, if you invest for a goal one to two years out and you hit a stock market slump, your chances of making money are not in your favor.

If however, you invest for five to ten years (or greater), if past stock market performance is anything to go by, you should see more up years than down. And thereby, stand a better chance of making a return on your investment.

Therefore, if you have a shorter term goal, think hard before investing in this type of product. As discussed in should I invest in a bank or a robo-advisor, perhaps a more guaranteed savings scheme would be more appropriate, especially if your goal is life changing. Try telling your partner-to-be the quality of his/her wedding will be dictated by how well Google is doing in the stock market. That’s a one-way ticket to StressVille!

Your Psychology

And speaking of stress. It is worthwhile examining how you think you will approach this form of investing. As mentioned above, WiseBanyan is designed to be a passive investment tool. Passive means you set-up your robo investing engine, keep it topped up with gas (money) and let her drive in auto-pilot. Most successfully long-term passive investors check in monthly to see how their fund is going.


Checking in sooner than that is, of course, an option but care is needed on two fronts.

  • Don’t expect big jumps week to week. Remember the tortoise and the hare? You are the tortoise!
  • Be careful not to react to dips. Over time, you will see downwards spikes. There is a real temptation for some people to ‘cash out’ once these occur. This doesn’t align with the principle of passive investing. Let your goal horizon be your timing metronome!

Risk Appetite/tolerance.

WisaBanyan is not a one-size-fits-all automated robo investing engine. You can easily tweak your engine based on your risk appetite. WiseBanyan invests your money in stocks/shares and bonds. To generalize, bonds are typically lower risk, lower return. Shares can deliver higher returns but are more volatile in nature, and therefore riskier.

balancing stocks and bonds

If you would like a lower risk investing engine, WiseBanyon makes it easy for you. And for the flip side, if you wish to chase bigger returns, aim to tune your WiseBanyan account for more stocks/shares than bonds.

There are obvious crossovers with the duration of your financial goals. Longer-term goals can opt for any approach. Conservative (more bonds than shares), balanced (50/50) or growth (more shares than bonds). Most experts would advise a conservative approach for shorter term goals, particularly if they are like the marriage example from earlier!

Additionally, if retirement is the goal, your age becomes a factor. If retirement is close, most experts advice moving from growth/balanced to conservative to try to lock in those gains from earlier years. So now know everything you need to before you commence your WiseBanyan journey.

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Account Setup

Well done! You’ve got the theory and are now ready to do the easy part, setup and automate your WiseBanyan account. And thankfully, they have done a great job to make it as easy as possible to get you up and running. Head over to, enter your email address and the email will guide you through the process. Most of the process is self-explanatory but there are three main ‘levers’ at your disposal when creating your account to tune your WiseBanyan engine, for you:

Stocks/Bonds distribution

After you’ve entered the default account creation info (date of birth, annual income, etc), WiseBanyan encourages you to assign a financial milestone. Remember the financial goals section above? This is essentially the same thing. So if your goal is to retire early or build a rainy day fund, select that option.

Is your goal not covered? Don’t worry, chose ‘custom’ and build a milestone around your bespoke goal. See, even people planning for a life on Mars are covered!:) Following this, the site does a great job of asking relevant questions to help determine your stocks/bonds distribution for your milestone. The stock/bond distribution essentially directs the robots as to your risk appetite. The greater the % of shares, the higher the risk/reward. Remember, this can be changed at any point so doesn’t think once it’s set up, that’s it. You can alter this lever as you go.

Account Type

For most people using a robo advisor for the first time, the default ‘Personal Investment Account’ is the one for you. The other types (Roth IRA, Traditional IRA, SEP IRA) are used for retirement specifically. I’ll cover them off below. As its name suggests, benefits you gain yearly from your Personal Investment Account are taxable 🙁 and should be reflected in your year-end tax returns. The only certainty in life are death and taxes, good old Benjamin Franklin was ‘on the money’ (boom boom) with that quote!


The final and most important part, feeding the beast! Based on your financial goal, WiseBanyan will suggest a monthly deposit amount. You can see what this looks like per week or per quarter and can also amend the value. Please note, if you amend it down, unless the investment planets align, you won’t make your full financial goal.

All serious financial goals require upkeep so unless you have a significant amount to invest upfront, we recommend starting with a moderate amount but establishing a monthly increase.

money and eggs in basket

This way, you don’t put all your eggs in your new ‘basket’ too soon, and you also teach yourself to regularly invest in your financial future. WiseBanyan also makes it easy to fund your account by linking your bank account. And their site is secure! No one wants more Equifax tomfoolery!

For most of us, that’s it! Following the creation of a secure password, in around 5 business days, your account will be created, authorized and funds transferred – all while you continue living your life! This means you have taken step number one in terms of creating an alternative financial future!

Auto Re-Balancing

The robots at WiseBanyan also have a feature installed called auto re-balancing. This keeps track of your stocks/bonds distribution assigned earlier and makes sure you are still lined up with the risk profile that works best for you. As a result, you can now step back, allow the robots to take the strain and check in from month to month to see how they are doing on your behalf!

Retirement Accounts.

WiseBanyan supports the creation of most common retirement accounts, Roth IRA, SEP IRA and Traditional IRA’s. They also support the ‘rolling over’ of a 401K (or similar) into WiseBanyon accounts. Creation of these accounts require slightly more work upfront but WiseBanyan’s help section (here) provides more detail on what is a more complicated topic than this article can do justice to.

Taxation and WiseHarvesting.

WiseBanyan also has a chargeable service called ‘WiseHarvesting’.


Essentially, this service instructs your robot to make sure it looks for opportunities to reduce the amount of tax you pay each year on WiseBanyan returns. Should I use this? This service isn’t free (it costs 0.24% annually, capped at $20 per month) and most smaller investors (or investors in a lower tax bracket) won’t see a significant return on investment. However, the cap of $20 per month should see a positive ROI for those with a significant amount of funds invested with WiseBanyan who don’t expect to move to a higher tax bracket in the future. Like retirement accounts, this is a topic in itself so those who are interested can do more reading here:

Your Protection

Finally, now I am up and running, how do I protect myself to make sure the money I have invested (and its returns) can be used for my particular financial goal. There are two ways to look at this, protection from the service folding and the stock market itself:

The Company

What happens if WiseBanyan goes out of business? Good question! Although their bots have been delivering value since 2013, the Great Recession demonstrates that no company is too big to fail. Thankfully, each and every Wisebanyon account has SIPC protection that covers up to $500,000 per client.

Stock Market Fluctuations

investments can go up or down

Ahhh, we all want our cake and eat it but, as always displayed on investment products linked to the stock market, your investment can go up as well as down! If you want to reduce risk, goes for more bonds over stocks and as mentioned above, try not to time the market. Easier said than done, right?:)

Thanks for reading this beast of an article. I hope this gives you the info you need to grab control of your financial future and start putting your money to work, for you.


James BurnsFounder @ Wealth-Hack
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Please note, all Wealth-Hack content must not be construed as financial/investment advice or as a de facto recommendation, but as ideas for further consideration. Please read our disclaimer for more detailed information.
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How to Invest Using WiseBanyan

How to Invest Using WiseBanyan

What is involved setting up a WiseBanyan account? What should I consider to make sure I invest wisely? All this, and more, inside.