Swell At a Glance
- low account minimum ($50)
- management Fee 0.75%
- easy setup
- invest in socially responsible companies
What is Swell Investing
Swell is a robo-advisor company that believes in investing in socially responsible companies. Although other companies offer socially responsible investing, Swell investing is unique in that it makes SRI their sole purpose. Swell helps the average person invest in companies that are solving global challenges. Furthermore, there are seven portfolios to choose from. Swell focuses on renewable energy, clean water, disease eradication, green tech and more, but also offers an Impact 400 investing option.
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What is an SRI fund?
SRI stands for socially responsible investing. An SRI fund’s main concern is investing in socially responsible companies that make an impact, while still making money. In short, if you invest in an SRI fund whether it be an ETF or mutual fund, the fund will promote causes that are good for society such as clean water, reusable energy, and/or disease eradication. Yet, an SRI fund will primarily stay away from funds that go against the “socially responsible” value systems such as gambling, alcohol use, and smoking. The bottom line is you can feel good about your investment with Swell investing because they have done the work of weeding out the “socially irresponsible” companies and you will not find companies that go against your value system as an investor. Plus you can choose which socially responsible area you would like to support.
What are Robo-Advisors?
Robo-advisors are software that provides investment-management options using algorithms with little or no human advising. Robo-advising is becoming popular, with Swell investing being one of the top robo-advisors. Robo-advisors provide the consumer with access to account diversification at a lower cost than a financial advisor. Robo-advisors can automatically set up your portfolio and rebalance according to mathematical algorithms derived by the company’s software.
How Does Swell Investing Work?
Swell investing works by signing up, choosing your portfolio, and linking your Swell Investing account to your bank account. Because of the $50 low account balance, this is a good choice for new investors that are looking for socially responsible companies to back. You can also automate your investing process and allow for Swell to reinvest dividends.
Swell investing offers seven different options to choose from. You can pick from any of the environmentally friendly areas:
- Invest in Green Tech – Electric cars and LED lights
- Invest In Clean Water – Water filters and pipe repairs
- Invest in Zero Waste – Recycling and repurposing
- Invest in Renewable Energy- Wind Turbines and solar panels
- Invest in disease eradication. – Immunizations and research
- Invest in Healthy Living – Nutritious food and health centers
- Invest in the Impact 400 – Most impactful companies across the stock market
Swell Investing Options
Flexible plans make Swell a viable investment option and you can customize your portfolio with three different choices that fit your needs.
Swell Investing offers three different investment options:
- Option 1 Thematic Portfolios – Choose between any of the seven investment categories, depending on your passions.
- Option 2 Impact 400 Balance Portfolio – This option invest your money into Swell’s top impactful publicly traded 400 companies.
- Option 3 Thematic and Impact – This option is a combination of option 1 and option 2. You can start with the Balance 400 if you aren’t sure which category to choose and add other categories as you go.
Guide to Impact Investing
Swell Investing Features
- Uses tax intelligent lot ordering to reduce taxable gains
- Automatic Deposits
- Dividend Reinvestment
- Tailor your Portfolio – You can choose companies that align with your goals and remove ones that do not.
Is Swell Safe?
In short, yes swell is a safe investment option.
Swell was started in 2016 and boasts socially responsible stock options. Since it is a newer company, this may leave you feeling uneasy investing your hard-earned money. However, Swell is backed by its parent company, Pacific Life one of the oldest and well-established insurance companies in North America. Pacific Life started Swell’s portfolio with seed investments.
Swell is unique in that it provides the average person a way to invest in socially responsible companies, which were left for larger company investments or ETF’s in the past. Swell investors can start with as little as $50 in their account. If you are looking for a company that is socially responsible but have little to invest in Swell is the right choice for you.
Also, Swell made the consumer Advocate’ list of top ten robo-advisors coming in at #3. (Source:Consumeradvocate.org)
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Should You Sign Up For Swell – Who Is Swell Investing Best for?
While Swell investing may not be for everyone, there are many that will benefit from investing with Swell.
Swell Investing is best for:
- beginning investors (new to investing and looking for guidance)
- social conscious investors (want to put money back into our planet and stocks that benefit humanity)
- investors looking to customize their investing portfolio (want an easy way to customize)
Since Swell is a Robo-advisor, it does the hard work for you without having to hire a financial advisor. If you are looking for someone to hold your hand through the investing process, Swell may not be the best option for you. However, Swell takes the burden of figuring out investing yourself away and leaves you with an easy way to start investing your money.
Also, if you have more money to invest, you may want to choose a company with a lower fee like Personal Capitol or Betterment.
With automatic rebalancing, you can literally set it and forget it. Swell rebalances semi-annually unless there is a compromise in the integrity of your portfolio
Swell robo-advisor runs through Folio, a registered clearing broker-dealer with the U.S. Security and Exchange Commission.
Swell Investing Sign-up Method
Signing up for Swell investing is easy. Simply go to the website (click here for Swell Investing) and click the link in the top right of the screen where it says, “sign up”.
You will then be taken to a page where you enter your name, email, and create a password and continue to fill out the rest of your information.
You will also need the following to sign up:
- Date of birth
- Social Security Number
- Employment Status
Because Swell verifies your account – to make sure you are who you say you are – opening up an account can take 4-8 business days to complete the entire process.
Also, Swell does not check your credit and your social security number is not stored. Nonetheless, you do have to be a U.S. citizen to invest with Swell.
Swell Investing Fees
You may be asking, how does Swell make money? Swell charges a .75% investing fee monthly. That means if you invest only $50 your annual fees will be about $0.375 ($50 * 0.0075= $0.375).
Swell investing fees are simple and easy. As stated on their website, “If you Invest $500, Swell will cost you $3.75 per year. That is less than a fancy cup of coffee.”
Although many other robo-advisers offer smaller fees, swell makes it easy for the beginning investor on a budget, with a low start-up investment of only $50, unlike many other companies making it impossible for the average low-income family to invest at all.
Pros and Cons of Swell Investing
Pros of Swell Investing
- Ease of use
- Social Conscious companies solving global challenges
- Low account minimum
- Perfect for beginners
- No trading fees
- Select between traditional brokerage or retirement accounts
- Automatic rebalance is semiannual unless compromised integrity of the portfolio
- The intensive screening process for chosen investment companies
Cons of Swell Investing
- Account fee is .75% per year, which is higher than some (however, many with lower fees require a higher investment amount)
- Can be difficult to contact customer service (can through email or phone during business hours only)
- Only invest with SRI companies (If you want other companies in your portfolio, you will have to go with another company)
- Less comprehensive approach (you will not find budgeting tools or market recaps)
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Swell Investing Conclusion
In conclusion, Swell investing is a unique investing platform in that it offers investors a change in funding socially responsible companies. Swell is perfect for a beginning investor; however higher fees might turn larger investors away. Swell has an easy sign-up process and is an affordable option if you are looking to invest in a small income. Swell makes it easy to automate your investing and start small. Although Swell lacks in areas of higher fees and customer service, it makes up for these shortfalls in ease of use and impact.