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Easy Investment. A difficult concept.
You want to invest some of your money but you don’t know where to start?
You’ve done your research on the different investing options, such as brokers and banks, but you are unable or unwilling to meet the minimum balance?
Investing is not an easy concept. There are so much information on the internet about all the options and what to do that it is difficult to figure out where to start.
I do have a good option for you, Mylo!
Invest your Spare Change Concept
In 2012 a new app, called Acorns was created to invest your spare change. It actually rounds up your daily transaction and use the “spare change” to invest into some ETFs. The concept is very appealing, you do not need to have a lot of money to invest anymore. It makes investing accessible to everyone!
Also, you don’t need to know everything about investing, although you should at least know the minimum. Maybe you think that you need to study individuals stocks to be able to invest, but it’s not the case with these kind of apps! They invest in ETFs and you just need to know the minimum! So Acorn brought a very nice concept to the USA and Australia now.
But what about us in Canada?
In 2017, a new app appeared: Mylo! Using the same concept as Acorns it uses your “spare change” and automatically invest it! Isn’t that an easy investment?
Although I just started using it, it’s very awesome and useful! It let me save some extra money without really knowing it and getting a very nice surprise when you look at your account!
Review Overview
Pros
- Goal Oriented: Mylo ask you for your own personalized goals, in both amount and end dates. That is something that put them apart from other apps and even brokers who don’t really care about your personal objectives;
- Secured Platform: Mylo! uses feature advanced bank-level security and is also backed by big investors such as Desjardins Capital and the account is with Canadian ShareOwner, which is owned Wealthsimple;
- Automates your saving: Mylo is one of the perfect way to automate your saving and to achieve your goal;
- Multiple Portfolios: There is five different portfolio, which you can customize for your own goals;
- Spending Habit Insight: Mylo will give you insight and tips and tricks on your spending habits to make better, advised decision.
- Very Small Fee: only 1$/month. Much less then your regular coffee! and
- Easy and free money transfer: No need to worry about transfer to your bank account. No need to pay an exorbitant fee to get your money.
What is Mylo?
Directly from the Mylo website we get there mission : Financial Inclusion For All.
Very simple sentence!
And from there website again:
” Mylo was created with the social mission of helping Canadians achieve their financial goals. We make saving and investing accessible to everyone. Over half of Canadian millennials have less than $1,000 in savings, regardless of their income. We’re working to fix that with a simple, automatic and stress-free solution for saving money and building wealth. It starts with roundups, but micro-saving is just the beginning. Mylo uses machine learning in conjunction with financial and transactional data to make personalized recommendations that help our users make smart decisions with their money. We launched our investment app in July 2017. Today, Mylo has already been downloaded by over 150,000 Canadians from coast to coast. “
As such, Mylo created an app aimed at removing the stress out of the equation when talking of achieving financial goals. They do that by automatically investing your spare change in ETFs, with a professional portfolio manager to manage your account to remove the hassle to get started when you do not have any investment knowledge.
Easy and Quick account creation (under 3 minutes!)
It’s an easy 4 steps process:
- Click on this link to go to the Mylo website ;
- Click on the green Get Started. It will bring you to the account creation page;
- Link your bank account at account creation;
- Download app;
- (optional) Sit back and enjoy the increased saving!
How does Mylo Works
At account creation, which take less then five minute, you will only need to create an objective, including amount and time, fill out a small “risk identification” survey and link your bank account or credit card. Based on the survey results and your personal objective, the portfolio manager will assign you to one of the portfolio.
These are defined for each one of your objectives, be it for saving for an early retirement or to create an emergency fund.
From now on, every time you’ll be using your bank card or credit card you have linked, Mylo will round up the transaction to the nearest dollar and easily invest it in your account.
If you want to contribute some extra money, you totally can.
Every time you’ll be using the cards/bank account you just linked, Mylo will round up all the transactions to the nearest dollar and invest that difference in your account. You can also set up recurring contribution and also you can make one-time contributions.
Goal Oriented
One of the great feature from Mylo is that it is goal oriented.
You define the goal you want to achieve, be it early retirement, saving for a house down payment or an emergency fund. These goals are define in both money amount and the date at which you want that goal to be achieved. You can, if you want, upload some inspiring picture, say the Caribbean to save for your next trip, to help you in achieving your goal.
If you have set up several goals, you will need to define the percentage of Round Ups that will go for each goal.
Tips:
Don’t forget that you can achieve your goal faster with a boost of a one-time deposit!
Here is a trick that a friend gave me. If you would buy something impulsively, let’s say a lunch from your work place cafeteria, but instead of spending that 10-15$ you made a lunch home last night.
Well, reward yourself and boost your Mylo Account with that money!
Inner working
Mylo says that it rounds up your transaction and invest that automatically to make investing easy.
However, it doesn’t do it in real time.
What is actually done, is that it aggregates the transactions from all the selected cards and transfer the amount once a week from a designated funding account. The actual cards will not be charged, all the money will be transferred directly from the selected account to your Mylo account. Why are they doing that you might ask? Simply to prevent extra fees from numerous transactions.
Tips:
By the way, if you still have transaction fees into your bank account, why not chose an account that has no fees for day to day banking? Tangerine offers just that! If you open an account with my Orange Key (48396560S1), you will get a nice bonus!
Just sign up here and don’t forget my Orange Key.
You need to know that you are in total control of the round up:
- The Round Ups can be pause whenever you want;
- A Round Up multiplier can be applied, taking the extra money out of your account. It increase your saving;
- Money can be withdrawn at any time;
Tips:
There is an option that can be set to notify you when your funding account balance goes below 25$ and you will have to manually approve the transfer. You can select that option if you think that the transfer will cause some overdraft.
Financial Insight
Another nice feature of Mylo that it will also give you some good financial insight such as tips, recommendations and education materials to help you save some extra money and achieve your financial goals.
Application Dashboard
The application dashboard is visually appealing and really friendly. You just have a some few options to set up after you’ve signed up and after this you can almost completely forget about it!
The dashboard only shows you what’s is necessary to get started:
- An overview of your goal and insight;
- All of the transfer in a separated tab ; and
- A tab to manage your account.
Safety of Mylo
Your Mylo account features the complete 256 bit bank level encryption and advanced security. Let’s just say that it’s very safe.
It’s backed by Canadian ShareOwner, owned by Wealthsimple and by Desjardin Capital.
It’s a good thing to consider that your Mylo account is insure with the Canadian Investor Protection Fund (CIPF) for up to $1 000 000 in case of Mylo’s bankrupcy.
However, there’s no promise your investments will always go up. You need to remember that there are always market risks associated with any investment.
Minor inconvenience
Location
For now, Mylo is only available in Canada. However, Acorn is accessible for the United State and for Australia and XXX for the United Kingdom.
Restricted Account Type
The type of account that you can open is limited. The normal account has to be a non-registered account. But with the Mylo Advantage , more on this later, you have the option of opening a Registered one, either an RRSP or a TFSA.
However, if you are not doing a lot of transactions, your Mylo account will not increase very much, unless you also add some one-time deposit or you also set some recurring contribution. For some people it might seem like a low investment otherwise.
Secondary Investment Role
As such, Mylo might be best use in a secondary role in conjunction of a primary investment tool, such as a broker or Wealthsimple for very long term, high amount goal.
The Benefits
No minimum to open an account.
That is very good.
There is a lot of brokers that will ask you a minimum to open up an account from 500$ to 25000$. But with Mylo , you can open up an account with 0$ and just let it run his course while you are going about your life.
Automatic Savings
Not only are the Round up automatic, but Setting up recurring contribution is another nice feature that allows you to save on autopilot and make for an easy investment. Setting up something similar with a lot of brokers is almost impossible. If I would like to do it with mine, I would have to create a Automatic Payment with Tangerine, then the money would be accessible in my broker’s account in 2 to 3 days, but I would have to manually invest the money myself.
Goal Oriented
You set your own goal. Mylo is only there to help you achieve your goal. You are the one who decides what kind of money you want to invest and the end date. Everything is personalized for you. This is THE feature that sets them apart from other Round Up apps.
Mylo Advantage
One of the biggest limitation to the Round up Mylo is that you don’t have access to so called Registered account, the TFSA and RRSP. Enters the Mylo Advantage! It comes with a new load of benefits, premium features and services that are not included in the normal Round Up Mylo subsription. Here’s what you get:
- TFSA and RRSP account types
- Access to Mylo SRI fund (Socialy Responsible Investment fund)
- Advantage perks and rewards from your favorite brands
- Next Day Withdrawals
Mylo Advantage, like the existing Mylo services is a subscription-based services, with a rate of $3/month.
If you subscribe now with this link you will get 3 months free!
Subscription fees
The standard Mylo has a small 1$/month fee. Mylo Advantage has a higher cost of 3$/month.
Is it a small or a big management fee?
That will depends on the amount of money that is invested into your Mylo Account. The higher the amount, the lower the percentage.
Here is an example.
If you have an average Round Up of 20$/month, it’s 240$ a year and Mylo takes 12$ for management purposes. This amount to 5%. Ouch, that’s a good margin that is taken out. Now, after a while, the amount of invested money will increase, but the 1$/month stays the same! The higher you go, the more beneficial it becomes.
All in all, if you are not using your cards to much, or if you have a low balance, this management fee will seems pretty high.
But as you invest money it will get lower and lower and will reach a point where it’s less then most Mutual Funds or event ETFs.
Remember that, this fee can be alleviated!
If you invite a friend to join with your Mylo App link , you both get a $5 bonus! Even if you’re not doing a lot of transaction and your not investing that much with Mylo, it’s still better than nothing!
And of course remember that you should have an emergency fund set up before diving deep into investing.
Mylo Review summary
Rating : 9/10
Summary
If you want to start an easy investment but you feel overwhelmed or if you are having trouble saving money to invest toward meeting your own goal, you really should be looking at Mylo. If you’ve looked at your daily transaction, you know how quickly that spare change could add up! Also, the Round ups and recurring contribution makes it easy to set your investment on autopilot while keeping your goal in sight.
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