Merrill Guided Investing: Is It the Right Choice for You?

Merrill Guided Investing is a robo-advisor service from Merrill, designed for investors who want automated portfolio management with varying levels of advisor access. It blends algorithm-driven investment strategies with professional guidance, offering a balance between automation and personalized advice.

Understanding its costs, investment strategies, and features is essential before deciding if it meets your needs.

Enrollment Requirements

To open a Merrill Guided Investing account, investors must be at least 18 years old, U.S. residents, and have a valid Social Security number. Non-resident aliens and those without a U.S. address are not eligible. Applicants must provide a government-issued ID and complete an online risk assessment to determine their investment preferences and risk tolerance.

The minimum investment is $1,000 for the standard robo-advisor service and $20,000 for Merrill Guided Investing with an Advisor, which includes access to financial professionals. These thresholds help ensure proper diversification.

Users must link a bank account for funding and withdrawals. Bank of America customers benefit from faster transfers, while external bank users may experience slightly longer processing times. As a digital service, Merrill requires applicants to receive statements and disclosures electronically.

Funding and Deposits

Accounts can be funded via electronic funds transfer (EFT), wire transfer, or by transferring assets from an existing Merrill or external brokerage account. EFTs typically take one to three business days, while wire transfers allow for same-day funding but may incur fees.

For rollovers from employer-sponsored retirement plans or transfers from other brokerages, Merrill offers the Automated Customer Account Transfer Service (ACATS), which moves securities without selling them first. The ACATS process generally takes five to ten business days, depending on the holdings’ complexity.

Recurring deposits can be scheduled weekly, biweekly, or monthly. There are no fees for setting up automatic contributions, but investors should ensure sufficient funds in their linked accounts to avoid failed transactions.

Portfolio Strategy

Merrill Guided Investing builds portfolios using a diversified mix of exchange-traded funds (ETFs) aligned with an investor’s financial goals and risk tolerance. The platform follows modern portfolio theory, aiming to maximize returns relative to risk through asset allocation. Portfolios include equities, fixed income, and alternative investments for a balance of growth and stability.

Investment composition depends on factors like time horizon and market conditions. Long-term investors may have a higher allocation to stocks, while those with shorter time frames may see more bonds. Merrill adjusts allocations based on economic trends to keep portfolios aligned.

Tax efficiency is a key consideration. Merrill incorporates tax-loss harvesting in certain accounts, selling underperforming assets to offset capital gains while maintaining the investment strategy. The ETFs used are generally tax-efficient, reducing the likelihood of unexpected taxable distributions.

Fee Structure

Merrill Guided Investing charges an annual asset-based fee of 0.45% for its standard robo-advisor service and 0.85% for accounts with advisor access. Fees are deducted monthly from the account’s cash balance or, if necessary, by selling investments. Merrill does not offer tiered pricing or discounts for larger accounts—all investors pay the same rate regardless of portfolio size.

In addition to the management fee, investors should consider the expense ratios of ETFs in Merrill’s portfolios, which range from 0.06% to 0.15% annually. Merrill does not charge trading commissions for buying or selling ETFs within the portfolio, though certain transactions, such as equity sales, may be subject to SEC fees.

Rebalancing Approach

Merrill Guided Investing uses automated rebalancing to maintain target asset allocations. Market fluctuations can cause asset classes to drift, increasing risk or reducing expected returns. The platform continuously monitors and adjusts holdings as needed.

Rebalancing occurs when an asset class deviates beyond a set threshold, prompting the system to buy or sell investments to restore the original allocation. Unlike robo-advisors that rebalance on a fixed schedule, Merrill’s approach is dynamic, responding to market movements to minimize unnecessary trades.

In taxable accounts, Merrill prioritizes trades that generate the least tax impact, incorporating tax-loss harvesting when possible. Dividends and new deposits are allocated to underweight asset classes to help rebalance portfolios naturally.

Available Account Types

Merrill Guided Investing supports taxable brokerage accounts, retirement accounts, and education savings plans.

Individual and joint taxable accounts offer flexibility for deposits and withdrawals but do not provide tax advantages. Retirement options include traditional IRAs, Roth IRAs, and rollover IRAs. Traditional IRAs offer tax-deferred growth, while Roth IRAs allow for tax-free withdrawals in retirement. Rollover IRAs enable investors to transfer funds from a 401(k) or similar employer plan while maintaining tax benefits.

For education savings, Merrill offers 529 plans, which provide tax-free growth and withdrawals for qualified education expenses. However, the platform does not support custodial accounts or health savings accounts (HSAs).

Access to Advisors

Merrill Guided Investing offers two service tiers: a fully automated robo-advisor and an advisor-assisted option. The standard service provides automated portfolio management, while Merrill Guided Investing with an Advisor includes access to financial professionals for personalized guidance.

Investors in the advisor-assisted tier can schedule phone or video consultations with Merrill financial advisors. These advisors help refine investment strategies and adjust portfolios based on changing goals but do not provide full-scale wealth management services.

For those using the standard service, customer support is available for technical and account-related inquiries, but investment advice is not included. The advisor-assisted option is better suited for individuals who want a balance between automation and professional guidance, particularly those with complex financial situations.