Robo Advisers

Santander Digital Adviser Review (Worth It?)

Many people view the stock market as an unattainable venture that is best left in the hands of in-the-know professionals. If you’ve considered getting into stocks but don’t know where to start, Santander Digital Adviser wants to help you navigate the stock trading jungle.

Through the use of an innovative robo adviser platform, you can:

  • Get your foot in the stock market door in as little as 30 minutes
  • Get advice cheaper than hiring a professional human adviser
  • Quickly and easily invest in stocks
  • Enjoy a user-friendly platform

In this article, we’ll break down Santander Digital Adviser into bite-sized chunks to help you find out whether their platform is right for you.

Let’s dive in.

Santander Digital Adviser: Verdict

Anyone who’s had reservations about getting into the stock market will find the Santander asset management tool to be an easy solution. Even better, the advice you receive is regulated financial advice. If you’re a beginner wanting to learn the ropes, Santander Digital Adviser is for you.

Pros & Cons

ProsCons
Great for beginnersHigh fund charges
Plenty of optionsTiered charges
User-friendly
Affordable

How Does Santander Digital Adviser Work?

To begin using the financial advice service, you must follow specific steps, starting with questions for the suitability report.

Answering the suitability report is a critical part of the Digital Investment Adviser (DIA). Here, the adviser collects user personal data and information regarding your risk tolerance, finances, and investment goals. With this data, Santander Digital Investment Adviser can effectively build your profile.

Next, it’s time to choose the best portfolio based on your profile. You’ll be presented with several portfolios to choose from, so you can select the one that you feel best matches your needs.

Finally, you need to open up an account using the bank that your investment funds will be deposited into.

Full Review

At first glance, you might be under the impression that a robo adviser like Digital Investment Adviser is a robot that provides you with financial advice on investments. 

However, a robo adviser actually serves to specially manage your stock actions by routinely advising on investments that are consistent with your investor profile and preferences.

Moreover, robo advisers depend upon algorithms and automation to manipulate investments. Their purpose is to tailor portfolios to your specific preferences, assets, conditions, and goals. There are a number of portfolios available for every type of investor.

The funding types that robo advisers typically provide are ISA or pension provider plans and investment funds. Pension provider plans are for your long-term savings, while investment funds serve to give you returns on your money.

Registration (9/10)

The wonderful thing about Digital Investment Adviser is its ease of use upon startup. Answering the questions about your investment outlook is an important step. Moreover, the answers that you provide will set the stage for how your robo adviser manages your investment portfolio going forward.

This portion of the initial stages is clear and easy to use. The actual portfolio that you eventually get is a group of Santander multi-asset funds. And yes, these funds are directly managed by Santander UK. But you do want to be mindful of the first questions presented to you. These test whether you are really interested in investing in the stock market.

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Santander currently manages billions-worth for customers across multiple countries. The most appealing aspect of the digital investment advice service for beginners is that you do not need experience to use it. This much is evident from the outset, as the adviser invitingly presents itself.

Based on your answers, your digital adviser will recommend multi-index funds. These are designed to give you an idea of how you can expect your cash account to perform.

You also get 24/7 online feedback on the performance of your investments. You will get a referral sent to your personal assessment report. This is the one you chose at signup.

Ease of Use (8/10)

Santander partnered with Be-IQ to present beginner stock market investors with a platform that uses measures and patterns to make it easier for users to avoid risk. Most people will get through the suitability report in about 30 minutes or less.

We appreciate the design and layout here, as there’s nothing overly complicated or confusing. Santander made a great effort to provide a viable solution for newbies who might not know the first thing about stocks and the stock market.

Another big plus is that you can access and use Santander Digital Investment Adviser from more than just your computer. It’s also available for tablets and smartphones.

Santander also provides you with educational videos to walk you through the service and signup. We’ve seen more attractive options elsewhere, but what’s here does the job. 

Another minor complaint that kept us from scoring the Digital Adviser’s ease of use a 10 was the fact that, even though it’s touted as being digital, paperwork is mailed to you a few days following your registration.

These papers are understandable, as they are for you to sign and authorise future withdrawals. But they are an extra step in what is otherwise a fairly streamlined process.

The other potential snag is that you must hold a general investment account with Santander. Once you have that in place, the Digital Investment Adviser is able to offer you advice based on various, albeit limited, Santander products. Moreover, the adviser is a mix of Santander’s Financial Planning Service and Investment Hub.

If you’re familiar with these additions, you’ll really feel at home with the Digital Investment Adviser. But even you’ve never used the Investment Hub or Financial Planning Service, the adviser is welcoming enough on its own to provide a pleasant user experience.

Features (7/10)

While the features presented in Digital Investment Adviser are ideal for beginners, seasoned investors will likely balk at what’s here. Unlike a traditional advice process, where you sit down and hash out your stock options face to face with an investment industry expert, you have to get used to Santander’s digital advice journey.

It’s definitely a different format than what most ordinary investors will be used to. Having your investment advice delivered via an automated investment platform is jarring when you’ve always met with direct investors.

However, this system is excellent for those looking to get their foot in the stock market door. The good news is that if you have a general understanding of the financial services industry, DIA is that much more user-friendly.

Santander Asset Management Funds

These are the 4 funds that the DIA is able to recommend in the suitability report. These funds are managed by Santander’s Asset Management Division. They invest in a series of index-tracking funds with varying degrees of risk.

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Let’s briefly go over these funds to give you a better understanding of what they are and how they work.

Multi-Index Fund 1 (300 KB)

This fund mainly serves to invest in passive, index-tracked collective investment plans. The fund’s global equity exposure will never surpass 30%.

Multi-Index Fund 2 (301 KB)

This fund mainly serves to invest in passive, index-tracked collective investment plans. The fund’s global equity exposure will never surpass 50%.

Multi-Index Fund 3 (301 KB)

This fund mainly serves to invest in passive, index-tracked collective investment plans. The fund’s global equity exposure will never surpass 70%.

Multi-Index Fund 4 (299 KB)

This fund mainly serves to invest in passive, index-tracked collective investment plans. The fund’s global equity exposure will never surpass 90%.

Tax-Efficient Investing

Santander lets you use your ISA savings account allowance to invest in stocks and shares. In doing so, you are afforded a tax-friendly method of investing. And as long as you entered this information into your profile, DIA will make recommendations based on your ISA.

Choose Your Own Investment

Santander’s Investment Hub simplifies the process of opening its Investment Account or Stocks and Shares ISA. Moreover, the Investment Hub lets you choose from a litany of investment funds. You can also choose your preferred payment arrangement.

Here, you can opt for either monthly payments or minimum lump sum investment payments. When combined with the adviser, the Investment Hub provides a formidable platform for managing your assets and stocks.

Pricing Structure (7/10)

For just £20, a suitability report can be created based on a complex risk assessment and financial behavior questionnaire. The report may transfer you to a Santander savings account or tell you how to start investing.

The range of funds available is limited to four different internal Santander funds as detailed above (Multi-Index Fund 1 through Multi-Index Fund 4). The minimum investment for a one-time investment is £500. However, if you commit to investing, the maximum investment is £20,000. Alternatively, you can pay a fee of £100 as long as you commit to paying a minimum of £20 per month.

Whether you invest in a fund with or without advice, your investment is held and managed in the hub, and fees will be charged to cover management fees. The fee is based on the value of the investment you hold in the hub and is paid every 6 months.

Moreover, your first £50,000 has an annual percentage of 0.35%. Anything above £50,000 and up to £500,000 has an annual percentage rate of 0.20%. And anything over £500,000 comes with an annual percentage of 0.10%.

How the Fees Work: Examples

Let’s say you decide to invest £10,000. The investment fees that you would pay out would come out to £35.00. This is because it’s on the band with a 0.35% annual fee.

Now, let’s say you invest £200,000. You would calculate what you owe by first breaking down the £200,000 into one £50,000 payment, and one £150,000 payment. Therefore, £50,000 x 0.35%, which equals £175.00, and £150,000 x 0.20%, which equals £300.00, for a grand total of £475.00.

There are always others costs and expenses you have to consider when managing an investment fund. These costs get deducted from the fund’s value by the fund manager. You can always review these charges before you invest, so you don’t have to worry about paying anything you don’t agree with upfront.

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Please keep in mind that the DIA can only handle investments of up to £20,000. For any investment exceeding this amount, you’ll need to resort to Santander’s Face-to-Face Advice. This advice is based on your financial situation, so you can look forward to personalised recommendations.

If you’re investing in stocks at a higher rate, DIA might not be the best fit for you. But for the beginner who is worried about taking a significant risk, the DIA is likely right up your alley. You stand to reap significant benefits, but be mindful that it could take some time before you see them.

And even then, there’s always a risk when you invest your capital.

What Other People Are Saying…

The consensus surrounding Santander’s Digital Adviser is that it’s an excellent starting point for anyone outside of the investment world looking to get their feet wet. That said, most people aren’t crazy about the fees associated with DIA.

You need to invest more if you want more equity exposure. But given what it is, the fee structure is somewhat understandable. This isn’t a platform for seasoned investors. On the contrary, it’s designed with beginners in mind, and that is what stands out to most experienced investors who use DIA.

Conversely, users who are new to the world of investing generally find DIA to be a nice fit. So while customer feedback as a whole is largely positive, it’s important to remember DIA’s target audience.

FAQ

Does Santander offer financial advisers?

Advisory services and securities are provided by Santander Investment Services. That’s because Santander Securities is a registered stockbroker and dealer, a Registered Investment Adviser, and both Member FINRA and SIPC. As such, you can trust that you’re getting professional advisory financial services.

How does a robo adviser work?

Robo advisers first collect information about customers through online surveys. Then, they automatically make investments that are beneficial to the client based on this data. Most robo adviser typically use what is known as passive-index investment strategies.

Are robo advisers worth the money?

Robo advisers are a good entry-level choice thanks to their ease of use, minimal fees, and low-cost threshold. If you need to invest £25,000 or less, robo advisers may be a great choice for you to get started in the world of investments.

Are there disadvantages to using robo advisers?

Anyone looking to make large investments will likely find robo advisers to have limited functionality and options. What’s more, robo advisers are generally seen as offering unorthodox advisory services compared to traditional, human services.

As such, human interaction is virtually non-existent. So if you’re an experienced investor, you’re probably going to be pining for real, one-on-one investment advice.

Tom
7.8

Santander Digital Adviser Review

Santander's Digital Investment Adviser is an excellent choice for newcomers. If you have limited (or no) knowledge of investing, you're likely to find Santander to be a great fit for your needs. With that said, as you become acclimated to investments and want to invest more capital, you may find DIA to be limited in what it has to offer.

Registration

9.0

Ease Of Use

8.0

Features

7.0

Pricing

7.0

Pros

  • Great for beginners
  • Plenty of options
  • User-friendly
  • Affordable

Cons

  • High fund charges
  • Tiered charges
About author

Fully qualified CISI Investment adviser for 5 year. Managed UK private client portfolios.
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