Robo-Advisor vs Online Broker: Which One Fits You?
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Choosing between a robo-advisor vs an online broker comes down to one question: do you want someone to build and rebalance your portfolio for you, or do you want to do it yourself for less? Both let you open a TFSA, an RRSP, or an FHSA online in Canada. The difference is who makes the decisions, and what that costs you each year. This comparison is part of our investing hub.
We are not ranking platforms here. For that, see our ranking of the best robo-advisors in Canada and of the best online brokers in Canada. This guide helps you decide which of the two models fits you, with fees sourced from each platform as of October 20, 2026.
Robo-advisor vs online broker: the basics
A robo-advisor is a managed account. You answer a questionnaire about your goals and risk tolerance, and the platform invests your money in a portfolio of exchange-traded funds (ETFs). It then rebalances the portfolio and reinvests dividends without any action on your part.
An online broker, also called a discount or self-directed broker, gives you a trading account and nothing more. You choose the ETFs or stocks, you place the orders, and you decide when to rebalance. Our guide to online brokers in Canada explains how these accounts work in detail.
Two models, one goal
Both models can hold the same kind of low-cost ETFs. The robo-advisor charges a management fee to make the choices and do the upkeep. The broker charges little or nothing per trade but leaves all the work, and all the mistakes, to you.
| Feature | Robo-advisor | Online broker |
|---|---|---|
| Who picks the investments | The platform, based on your questionnaire | You |
| Rebalancing | Automatic | You do it yourself |
| Main fee | Annual management fee: 0.2% to 0.5% at the platforms cited, plus ETF MERs | Trading commissions, $0 at several platforms cited, plus ETF MERs and any account or currency fees |
| What you can hold | The platform's ETF portfolios | Stocks, ETFs, and other securities offered by the broker |
| Time needed | Very little after setup | Regular check-ins to buy and rebalance |
| Registered accounts | TFSA, RRSP, and FHSA at many platforms | TFSA, RRSP, and FHSA at many platforms |
What each one costs
Fees are where the two models differ most. A robo-advisor charges an annual management fee, as a percentage of your balance, on top of the management expense ratio (MER) of the ETFs it holds. An online broker may charge a commission per trade, an account fee, or currency conversion fees, but no ongoing management fee.
Robo-advisor fees
Here are the management fees published by two Canadian robo-advisors, as of October 20, 2026:
- Wealthsimple managed investing: 0.5% (Core, from $1), 0.4% (Premium, from $100,000), and 0.2% to 0.4% (Generation, from $500,000), according to Wealthsimple's pricing page.
- Questwealth Portfolios (Questrade): 0.25% on balances of $250 to $99,999 and 0.20% from $100,000, according to Questrade. Questrade lists the ETF MERs of its standard portfolios at 0.09% to 0.12%.
These fees apply every year to your whole balance. On a $50,000 portfolio, a 0.5% fee costs $250 a year and a 0.25% fee costs $125 a year, before the MER of the ETFs.
Online broker fees
Here is what three self-directed platforms list, as of October 20, 2026:
- Wealthsimple self-directed investing: $0 commission on Canadian and US stocks and ETFs; 1.5% currency conversion fee on US trades in a CAD account.
- Questrade self-directed: $0 to buy and sell Canadian and US-listed stocks and ETFs, with no annual account fee and no inactivity fee.
- National Bank Direct Brokerage: free online stock and ETF trades; a $100 annual administration fee, with exemptions if you meet the criteria, according to its pricing page.
With a broker, your main ongoing cost is the MER of the ETFs you choose, plus any currency conversion. If you buy one all-in-one ETF and hold it, your yearly cost can be much lower than with a robo-advisor.
The real trade-off: time and discipline
The robo-advisor's fee pays for three things: portfolio selection, automatic rebalancing, and protection against your own impulses. When markets drop, a robo-advisor keeps investing according to plan. A self-directed investor has to resist the urge to sell.
An online broker rewards investors who keep it simple. One or two diversified ETFs, regular deposits, and a rebalance once or twice a year are enough. The risk is behavioural: trading too often, chasing hot stocks, or holding too much cash.
A simple test
Ask yourself what you would do if your portfolio fell 20% in a month. If the honest answer is "sell", a robo-advisor's automation is probably worth its fee. If the answer is "keep buying", a broker can save you money every year.
Who should choose a robo-advisor
A robo-advisor fits people who want a hands-off portfolio and are willing to pay a small fee for it.
- You do not want to pick investments: a questionnaire sets your portfolio.
- You want automatic upkeep: rebalancing and dividend reinvestment happen for you.
- You tend to react to market news: automation keeps you invested.
- You start small: Wealthsimple managed investing starts from $1, as of October 20, 2026.
Who should choose an online broker
An online broker fits people who are comfortable picking ETFs and want the lowest possible cost.
- You know what you want to hold: one or two diversified ETFs, chosen once.
- You can stay the course: you keep buying when markets fall.
- You want the lowest cost: no annual management fee on your balance.
- You want flexibility: individual stocks, US-listed ETFs, or GICs in the same account.
TFSA, RRSP, and FHSA: same rules on both
The account type does not change with the platform. A TFSA, an RRSP, or an FHSA follows the same CRA rules whether a robo-advisor manages it or you manage it yourself at a broker. The 2026 limits set by the Canada Revenue Agency are:
- TFSA: $7,000 of new room for 2026, plus any unused room carried forward.
- RRSP: 18% of your previous year's earned income, up to $33,810 for 2026, minus any pension adjustment.
- FHSA: $8,000 a year and $40,000 over your lifetime, with up to $8,000 of unused room carried forward.
Before you open an account, check that the platform offers the registered account you need. For example, Wealthsimple lists a TFSA, an RRSP, and an FHSA in our catalogue. To decide which account to fill first, try our RRSP vs TFSA calculator and our FHSA calculator.
Can you use both?
Yes. Many investors keep a robo-advisor for one goal and a broker account for another. For instance, an RRSP at a robo-advisor for retirement and a TFSA at a broker for a do-it-yourself ETF portfolio. You can also transfer a registered account from one platform to another without tax consequences through a direct transfer.
Conclusion
A robo-advisor vs an online broker is a choice between paying for automation and doing the work yourself. As of October 20, 2026, robo-advisor management fees run from 0.2% to 0.5% a year at the platforms above, while several brokers charge $0 per stock or ETF trade. The difference adds up over decades, but only if you stick to your plan.
If you want a portfolio that runs itself, start with a robo-advisor. If you are comfortable with one or two ETFs and regular deposits, a broker costs less. Either way, the account type, whether TFSA, RRSP, or FHSA, matters as much as the platform. Run your numbers through our compound interest calculator to see how a fee difference grows over time.
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Frequently asked questions about robo-advisors and online brokers
Is a robo-advisor worth the fee?
It depends on how much you value automation and discipline. A robo-advisor charging 0.5% costs $250 a year on $50,000, before ETF fees, and in return it picks, rebalances, and keeps investing through market drops. If you would otherwise sell in a panic or never rebalance, the fee can pay for itself. Compare platforms in our ranking of the best robo-advisors in Canada.
Are online brokers cheaper than robo-advisors?
Usually, yes, because there is no ongoing management fee. Several Canadian brokers charge $0 to buy and sell stocks and ETFs as of October 20, 2026, so your main cost is the MER of your ETFs. Watch for account fees, currency conversion fees, and the cost of your own mistakes. See our ranking of the best online brokers in Canada.
Can I open a TFSA or an FHSA with a robo-advisor?
Most Canadian robo-advisors offer registered accounts, but the list varies by platform, so check before you sign up. The rules and limits are the same as anywhere else: $7,000 of new TFSA room and $8,000 of FHSA room for 2026. Our TFSA guide explains how contribution room works.
Is my money safe with a robo-advisor or an online broker?
Your investments are held in your name and can lose value with the markets. If the firm is a member of the Canadian Investor Protection Fund (CIPF), your property is protected up to $1 million per account group if the firm becomes insolvent, but not against market losses. Check membership on the firm's website. Our guide to online brokers covers what to verify.
Can I switch from a robo-advisor to an online broker later?
Yes. You can move a TFSA, an RRSP, or an FHSA from one institution to another through a direct transfer, which keeps the tax shelter intact. The receiving platform usually handles the paperwork, and some reimburse transfer-out fees. Look at our list of brokerage transfer bonuses before you move.
Which is better for a beginner?
A robo-advisor is the simpler start: you can begin with a small amount and never pick an investment. An online broker suits a beginner who is willing to learn the basics of ETFs first. Our guide on what an ETF is is a good place to start either way.
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