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Founded in 2016, StashAway was the first robo advisor to obtain a full capital market services licence from the Monetary Authority of Singapore (MAS). This allows it to provide investment advice to retail and accredited investors and to manage our investments.
It has also recently crossed the US$1 billion mark for assets under management (AUM) in January 2021. StashAway currently operates in Singapore, Malaysia, UAE, Hong Kong and is preparing to launch in Thailand.
Recently, StashAway announced it’s Series D fundraising of US$25 million from Sequoia Capital India. This brings its total funds raised to over $61 million.
Investing In StashAway Portfolios
In general, robo advisor platforms aim to leverage technology to reduce the need for human advisors and provide a convenient digital experience. This also allows StashAway to offer us more consistent investment advice and lower management fees. At the same time, robo advisors also assess our risk appetite to offer us more personalised portfolios.
StashAway invests in Exchange Traded Funds (ETFs) with high trading volume, deep liquidity and very low expense fees. It does so to achieve broad-based diversification and enable us to invest passively – without the need to constantly monitor our portfolios.
There is no minimum deposit (in Singapore Dollar) or investment amount required. However, if we want to deposit in U.S Dollar, we need to deposit a minimum of US$10,000.
StashAway has three main portfolios that we can invest in – 1) General and Goal-based portfolios, 2) Singapore-focused Income portfolio, and 3) Cash Management portfolio called StashAway Simple.
StashAway charges a fee of:
- First $25,000 – 0.8%
- Additional amount above $25,000 to $50,000 – 0.7%
- Additional amount above $50,000 to $100,000 – 0.6%
- Additional amount above $100,000 to $250,000 – 0.5%
- Additional amount above $250,000 to $500,000 – 0.4%
- Additional amount above $500,000 to $1,000,000 – 0.3%
- Additional amount above $1,000,000 – 0.2%
This means StashAway’s fees stack. For example, regardless of how much we are investing with StashAway, the management fee for the first $25,000 is always charged at 0.8%.
Investing In Multiple Goals With StashAway’s Core and Higher Risk Portfolios
StashAway’s goal-based portfolios are its main investing portfolio that enables us to gain global investment exposure via U.S. Dollar-denominated ETFs.
StashAway uses its proprietary Economic Regime-based Asset Allocation (ERAA) framework to build its investment portfolios. According to the company website, this maximises net investment return at each risk level.
Under StashAway’s General and Goal-based investing, we can build multiple portfolios for different purposes. This allows us to work towards different goals and take on different risk levels for each type of goal. This makes sense as we may want to take a lower risk with goals that are approaching such as emergency fund, wedding or buying a home. Similarly, we may be able to take on more risks for goals that are decades away, such as retirement or our child’s education. We may also want to take a much higher level of risk for certain goals such as buying a vehicle if it’s an expense we are able to forego in case the investments do not perform as well as hoped.
Under each goal, we need to either decide 1) that we want StashAway to compute how much we need to achieve that goal (based on the number of years we have till we need to achieve the goal) or 2) that we already know how much we need to set aside.
Interestingly, StashAway is able to estimate our goal. For example, I wanted to estimate how much I would need to invest each month to send my child to school in about two decades. StashAway estimates that I would need $117,000 and that investing about $250 is a safe bet to hit that figure in that time.
We are able to set a recurring investment sum and keep it on autopilot. We can also keep track of our progress whenever we want by simply logging into our account. Perhaps the best part about investing in a robo advisor platform is that we can simply ramp up or turn off our investments as and when we want, or even sell it, without being hit with any form of penalty.
Investing In StashAway Income Portfolio
As its name suggests, the StashAway Income Portfolio is invested in ETFs that are able to pay out an income. The StashAway Income Portfolio is comprised of six SGX-listed ETFs that are exposed to a mix of:
- Government bonds (SG Government Bond)
- Agency bonds (Asia High Yield Corporate Bond)
- Investment-grade corporate bonds (SGD Investment Grade Corp Bond)
- Real Estate Investment Trusts (S-REIT and Asia ex-Japan REIT)
- Dividend-focused equities (Straits Times Index ETF)
While there isn’t a minimum investment amount for its core General and Goal-based portfolios, we have to invest a minimum of $10,000 in the StashAway Income Portfolio.
We can either opt to reinvest our dividend payouts or send them to our personal bank account. This can be useful as younger investors may prefer to reinvest their payouts to build a larger portfolio, while older investors may prefer to use the payouts to supplement their monthly expenses. StashAway does not aggregate the payouts from underlying investments, and simply payout distributions when they are made.
Growing Cash Savings With StashAway Simple
Cash management accounts have become increasingly popular investment tools as well. They allow us to maximise our cash balances, usually in investment accounts with brokerages or robo advisors, by ploughing them into the money market fund. This way, they do not sit idle, and instead, are able to earn a return for us.
Unlike its General and Goal-based portfolio and StashAway Income portfolio, StashAway does not charge any management fee for its StashAway Simple. On its website, the projected return rate of StashAway Simple 1.2% per annum.
Unlike a fixed deposit, our funds with cash management accounts are typically no lock-ins. There’s no penalty for wanting to withdraw our funds at any point. Compared to a high-interest savings account, StashAway Simple does not provide interest returns based on tiered sums kept within the account. Of course, StashAway Simple is ultimately an investment in money market funds – and not a deposit account with a bank.
Within our StashAway Simple portfolio, 50% of our funds will be invested in LionGlobal SGX Money Market Fund and the other 50% in LionGlobal SGX Enhanced Liquidity Fund. If we like, we can choose to only invest in StashAway Simple and not its other investment portfolios.
Investing Your Supplementary Retirement Scheme (SRS) Funds With StashAway
The SRS scheme can be a powerful tool to aid us in accumulating a larger retirement nest egg. Similar to topping up our Special Account or Retirement Account via the RSTU Scheme, we can benefit from dollar-for-dollar tax relief. However, unlike top-ups into our CPF accounts, any top-ups we make into our SRS account do not earn us meaningful returns unless we invest them.
StashAway also gives us the option to put our SRS funds into all three – General and Goals-based portfolio, StashAway Income portfolio and event StashAway Simple. By just putting our SRS funds into StashAway Simple, we can already be better off while taking a small amount of risk.
Similarly, we can also take more risk (and earn a potentially higher return) by investing our SRS funds into the riskier portfolios.
Enjoy 50% Management Fees For 6 Months With StashAway
For those who are interested to try the StashAway platform for yourself, StashAway is giving 50% off in management fees for 6 months, for up to $50,000 in portfolio value.
That makes it perfect for giving StashAway a try and see if it is the robo-advisor for you. You can sign-up for free today to enjoy this exclusive promotion.