What is Ellevest?
Ellevest is a digital investing tool created to help women make smart financial decisions customized to their unique lives. By using the Ellevest app or online platform, users can begin investing immediately to reach their financial goals. It's important to note that services are accessible to the everyday user for a $0 minimum and low fees.
Unlike other similar firms, Ellevest factors in unequal pay, lifespan, and motherhood when it comes to investments unlike its typical financial service counterparts. Nevertheless, all genders are welcome to use Ellevest and take advantage of their innovative investment algorithm and management services.
The Ellevest Origin Story
After a successful career in leadership at giant financial institutions such as Merrill Lynch and Citi Private Bank, Sallie Crawcheck realized it was time to innovate the investment industry. She had experienced how everything in the financial world was structured to benefit men. Driven by a desire to make a much needed change, Sally made the leap into entrepreneurship with the goal of creating an investment service with women in mind.
Partnered with tech guru Charlie Kroll, Sallie created Ellevest to increase women’s financial power in an effort to help them reach their life goals. The team spent 200 hours interviewing women to design the best possible process for their investment product.
After testing over 500 economic scenarios and spending 40 hours on ethnography research, the founders of Ellevest can say they truly created a financial service specifically made in the interest of women.
Ellevest’s overall goal is to empower women financially. They do this by helping women in the following ways:
- Attain financial goals
- Understand life’s financial trade-offs
- Prioritize unique goals
- Plan for a personalized future
- Provide tools to take control
Ellevest believes that because women are often paid less and live longer, it makes sense for a personalized investment approach. The organization also emphasizes the importance of beginning to invest now, no matter how much with which you begin, to make a brighter future for yourself.
How Ellevest Works
By inputting a few key facts about your life, Ellevest will create a personalized investing plan made exactly for your circumstances. After signing up for a profile, you’ll put in your salary, location, gender, and money goals. Given this information, Ellevest designs an investment plan and shows you how much of your savings should be invested in stocks, bonds, and alternatives based on your current financial situation.
No matter how much you have ready to invest, you can begin working toward your goals with your personalized investment plan. While many similar services require a minimum deposit of $1,000-$5,000, you can begin investing on Ellevest with just $5.
As you add money to your account, Ellevest’s software manages your investments and ensures that you’re making smart financial decisions as time goes by. Ellevest users can also make changes to their investment plan as often as they’d like.
How Much Does Ellevest Cost?
Ellevest offers numerous plans to fit your investment preferences.
This plan is a great place to start for those looking to begin and build momentum with investing. The fee is .25% per year. Meaning, if you had $5,000 invested, the fee would be $12.50 for one year.
Ready to invest $50,000 or more? The Ellevest Premium plan is perfect for those who already have some savings. This plan also comes with one-on-one career coaching and financial planning. The annual fee is .50%; hence, with $50,000 invested, you’d pay a $250 fee for the year.
For users with $1M or more to invest, the Private Wealth plan is a smart choice. In this plan, Ellevest provides a team of advisors to manage your portfolio on a one-on-one basis. Get in contact with Ellevest to learn the fee.
What Ellevest Does
Based on your personalized investment plan, Ellevest invests in low-cost ETFs and other funds consisting of stocks, bonds, and alternatives.
Once your money is in Ellevest, they will purchase these funds for you and automatically adjust your plan for you as needed.
Users can’t pick and choose what stocks they want to invest in, but rather enjoy Ellevest taking care of that for them.
Ellevest’s main investment programs invest in entire markets that make up hundreds of diverse companies as well as bonds from the U.S. government, real estate, and international markets.
Additionally, Ellevest prides itself in offering impact investing, an opportunity to put your money toward changing the world. Ellevest Impact Portfolios invest in companies that have women in leadership, are sustainable and ethical, or develop the community.
Why Ellevest Matters
The investment industry has one of the lowest percentages of women in leadership at only 4% according to Harvard Business Review. Due to this low figure, investment services don’t always take into account women-centered challenges. Ellevest seeks to make a difference by designing everything in their program around the unique lives of women.
In addition to a lack of women in investment leadership, women also aren’t investing as much as men. Forbes magazine shared the following eye-opening facts about women and investment:
- Women have different motivations from their male counterparts. More than 60% of women see wealth as a means to provide for their families and secure their future.
- 36% of women said complexity and lack of knowledge or trust in the finance industry were key reasons not to invest.
- Almost 50% of women in a UK study said they did not have the confidence to become an angel investor.
Ellevest simplifies the entire investing process while addressing the specific aspects surrounding a woman’s life. The app aims to empower more women to invest and prepare for the future.