Wealthfront vs SoFi: Choosing the Best Robo-Advisor

Updated March 28, 2025

7 min read

When choosing a robo-advisor, two names will surely surface early in your search: Wealthfront and SoFi. These firms have come to define financial services in the 21st century, largely thanks to modern offerings like robo-investing and high-yield savings accounts (HYSA).

But just because both companies are synonymous with “fintech” doesn’t mean the two are interchangeable. To help you determine whether either is the right fit for your financial needs, let’s dive into the benefits and drawbacks of Wealthfront vs SoFi.

What is Wealthfront, and how does it work?

Wealthfront is an automated investment service company. In other words, it’s not a bank, but rather a broker-dealer and registered investment adviser with a strong focus on automated investing.

With Wealthfront, users can save and grow their money, invest in various asset classes, and open a line of credit. Through its partnerships with other banks, it is also able to offer its flagship Cash Account, which functions as an HYSA with an industry-high annual percentage yield (APY). Currently, funds held in a Wealthfront Cash Account earn a top-of-the-range 4% APY*. The account has no monthly fee and requires a $1 minimum deposit.

Wealthfront will provide customers with an optional debit card upon request, enabling them to spend their money and access feeless ATMs through Allpoint’s network. It also partners with several banks to provide high levels of Federal Deposit Insurance Corporation (FDIC) coverage of customer funds. $8 million per Wealthfront depositor is FDIC-insured, compared to just $250,000 when investing in a single bank. The company achieves this by sweeping deposits through a network of partner banks.

Elsewhere, Wealthfront’s Automated Investment Accounts allow users to invest with the help of a “robo-advisor”. Account holders define certain parameters, such as risk tolerance and asset allocation. Then, the platform’s technology automatically invests, diversifies, and rebalances the portfolio, based on those parameters.

However, despite some similarities, Wealthfront also has several limitations compared to banks. Most notably, it has few borrowing options and no brick-and-mortar presence.

What is SoFi, and how does it work?

Unlike Wealthfront, SoFi is a bank, albeit one that operates entirely online. It offers HYSAs and investing capabilities, while also providing more traditional banking services such as personal loans, student loans, mortgages, and credit cards.

The firm positions itself as a one-stop shop to help consumers achieve their financial goals. It has an expansive suite of products designed to meet a wide variety of needs.

SoFi provides Checking and Savings members with fee-free accounts and ATMs. SoFi is a member FDIC, so $250,000 per depositor is automatically insured, and those enrolled in the company’s Insured Deposit Program receive protection on up to $2 million in deposits. Much like Wealthfront’s additional protection, SoFi uses partner banks to spread out multiple deposits to meet the FDIC maximums.

The company also offers an HYSA with a 3.80% APY*, although customers must meet certain guidelines to receive the highest rate, such as minimum deposit requirements or premium membership.

SoFi’s many additional products include:

Loans
Loan refinancing
Credit cards
Insurance
Estate planning
Robo-advising and investing

Like Wealthfront, SoFi is fully online, with no physical locations. While some of its individual products fall short of other similar offerings, as a comprehensive financial services provider, SoFi effectively replicates and evolves the traditional banking experience.

Wealthfront vs SoFi: How do they compare?

There are several key differences between Wealthfront vs SoFi. It is important to consider these distinctions when determining which company is the right fit for your unique financial needs — if indeed either one is.

Account Options

Both Wealthfront and SoFi offer a single account option, which effectively functions as a hybrid checking and savings account with high APYs. Neither company charges a monthly fee for basic accounts. But their account options do differ in several ways, including:

Minimum deposits: Wealthfront requires a deposit of $1 to open its Cash Account, with no additional deposit requirements. SoFi has no minimum.
HYSAs: Wealthfront provides 4.00% APY* on all Cash Accounts. SoFi offers 3.80% APY* to account holders of its HYSAs, so long as they direct deposit at least $5,000 per month and/or enroll in SoFi Plus, which carries a monthly subscription fee of up to $10.
ATMs: Both companies use the Allpoint ATM network. Wealthfront provides access to 19,000 of these fee-free ATMs, while SoFi accommodates 55,000.
FDIC Insurance: SoFi is a member FDIC, which protects $250,000 per depositor, and the company will insure up to $2 million through its Insured Deposit Program by leveraging a network of partner banks. Wealthfront is not a bank, but it offers up to $8 million in FDIC protection through its own partnership network.

Borrowing

This is one area where Wealthfront’s offerings notably fall short of SoFi’s.

Wealthfront offers only one borrowing option. It will extend a line of credit to taxable Automated Investing customers, allowing them to borrow against up to 30% of their investing portfolio. On the plus side, this feature does not require a credit check and has no set repayment schedule.

SoFi, meanwhile, provides many borrowing options — personal loans, student loans, business loans, mortgages, loan refinancing, and credit cards. These loans do require a credit check and set repayment schedule.

Investing

On the other hand, Wealthfront outpaces SoFi when it comes to the breadth and depth of its investing services.

Wealthfront offers individual investing accounts, joint investment accounts, IRAs, and 529 savings plans, as well as an Automated Investing Account with a minimum deposit of $500. Users can invest in a variety of assets, including stocks, exchange-traded funds (ETFs), and bonds through Wealthfront’s unique Automated Bond Ladder. The company’s investing accounts carry a competitive annual management fee of 0.25%.

SoFi Invest is geared more toward retail investors. It enables individuals to invest directly in equities, options, and ETFs, with no commissions or contract fees. It also provides a robo-advisor with a 0.25% annual management fee. However, unlike Wealthfront, it does not offer advanced charts or research tools.

Apps and Features

Both Wealthfront and SoFi have a highly-rated mobile app. Their respective apps allow customers to make mobile check deposits, initiate speedy transfers, and locate ATMs.

However, as a full-service bank, SoFi’s app has a few additional features: savings round-ups, budgeting tools, automatic transfers between subaccounts, and 24/7 customer service.

Finding the right robo-advisor for your needs

When comparing Wealthfront vs SoFi, the optimal choice depends largely on your financial priorities — whether that’s maximizing returns, minimizing fees, or accessing comprehensive banking services.

There are many choices on the market, and each caters to different financial needs. While Wealthfront and SoFi are two of the biggest robo-advisor providers in the space today, they’re not the only ones.

Frec offers a unique automated investing option, leveraging strategies once reserved for ultra-high-net-worth investors. With Frec Direct Indexing, rather than investing in ETFs that track indexes like the S&P 500, investments are made directly into the stocks that comprise the index. The platform then automatically optimizes for after-tax returns via tax-loss harvesting.

Both Wealthfront and SoFi offer variations of automated investing and banking. And, although SoFi does not offer direct indexing, Wealthfront has recently launched its own Tax-Loss Harvesting product. It differs from Frec’s in several key ways.

Account Types: Wealthfront offers a pure S&P 500 direct indexing option with a 0.09% annual fee and a $20,000 minimum deposit. Frec offers a more customizable direct indexing solution with an annual fee starting at 0.10% and the same minimum for multiple standard indices. Both options leverage automated daily tax-loss harvesting.
Complexity: For broader diversification (think international or small-cap exposure) Wealthfront’s minimum deposit climbs to $100,000, and its service carries a higher annual fee of 0.25%. Frec’s minimum deposit simply increases to $50,000.
Customizability: Legacy robo-advisors may force you to buy or sell assets to rebalance your portfolio, which can trigger capital gains taxes. Frec allows you to control when to rebalance, helping you avoid unnecessary taxable events.

Wealthfront’s direct indexing product may be ideal for investors who prefer a hands-off, all-in-one solution. On the other hand, Frec provides deeper control over your tax strategy, index choices, and stock selection. Once again, the choice between the two hinges on your unique financial situation and goals.

Curious if Frec could be a better fit for your needs? Click here to book a demo.

*APY as of 3/24/2025. Rate subject to change.