Here's What You Lose When You Let Computers Invest Your Money for You

​Is it possible you're missing out on one of life's greatest pleasures by letting a robo advisor have all the fun?

In personal finance, as in life, we feel satisfaction when we set goals and achieve them. It makes us feel that life is worth living, we're getting somewhere, and we're not just wasting our time on earth.

But one of the things a robo advisor doesn't do for you is set goals and tell you how to achieve them.

You Have Goals, Don't You?

The strength of digital advisors, as they're sometimes called, lies in the automation of a single part of your overall financial plan. You, or someone you trust, has to do the rest.
Money is a symbol of our aspirations for our lives- it's how we get where we want to be. But if all you do is work, spend, and invest the rest with a robo-advisor, you may not be fulfilling your goals as effectively as you could.
That's where financial planning comes in. A good plan will take into account your earning potential, your education, your goals, your personal situation, your family, and your future (have we forgotten something?). A financial advisor can take your dream of owning a weekend cabin in the woods and turn it into a financial goal, complete with a plan to get there.
Can a robo advisor do that for you?

Here's What Robo Advisors Can & Can't Do For You
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If you put all your spare cash into a robo-advised investing account, you might be missing out on some pretty serious financial techniques that could get you places faster. You're also missing out on learning how to prioritize your finances – a life skill that will serve you forever.
For example, how many people investing with robo advisors don't have an emergency fund in place? It's actually pretty common, given the grim stats on how Americans just don't save a thing. And by not having an emergency fund in place, you're risking having to do some pretty fast and desperate manipulation of your finances should you encounter a cash emergency (like huge medical bills, for example). That could set you back a long ways in terms of reaching your financial goals.
By blindly socking away your spare cash in a robo-advised account, ignoring the rich variety of savings and investment tools at your disposal, you could be missing out. Learn more about personal finance or talk to a financial advisor to find out what you're missing!

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Timothy J. LaPean, CFP®, ADPA® is the owner of Thoughtful Financial Planning, a fee-only financial planning firm located in Minneapolis, Minnesota. Thoughtful Financial Planning specializes in helping women, members of the LGBTQ community, and the people who love them manage the financial side of living a more fulfilling life. Timothy and I became friends through the XY Planning Network (a group of like-minded, fee-only planners who work with Generation X and Y clients) and I asked him to write some thoughts on robo advisors as a guest topic for this site.