How good is the Moka automatic investing app?

• Link Moka with your credit or debit card and they'll round-up everyday purchases to the nearest dollar.
• Round-ups are passively invested and you can benefit from cashback perks to increase savings.
• Is Moka the best way for you to start investing for your future?

Moka offers the millennial and zoomer investor simplified automated savings and investment tools and no account minimums. You download and manage your account through a dedicated app for Android or iOS devices with a user-friendly interface.

Founded in 2017, Moka is the renamed Mylo, which underwent a branding overhaul while entering the French market. The company offers a robo-advisory service to help you achieve your investment goals through the process of micro-savings, rounding up your purchases and investing the small change.

Let’s unpack the offering from this world-class service.

How does Moka work?

Moka works to make saving and investing easy for newcomers to financial planning. After you sign up with Moka and link your bank account, you go through an investor profile assessment to create your savings goals and choose your funding method. Moka does the rest.

The Moka app builds investment habits through the process of micro-saving small amounts. The app’s roundup feature automatically rounds up your daily purchases to the nearest dollar. You can choose to invest the money into a personalized investment portfolio of low-cost ETFs, save it for debt paydown or a future goal such as buying a home or taking a holiday, or donate them to one of 85,000 charities.

When you sign up and start investing with Moka, the platform AI asks you a series of questions relating to your financial and investment goals.

The Moka goals ask you to think about the following.

• What are you saving for in life?
• How much cash do you want to save?
• What type of investment account do you want? (Unregistered, TSFA, and RRSP accounts)
• When do you want to achieve your goal?
• Create multiple goals and edit them when you want.

If you choose to invest, the robo-advisor distributes the money from your savings account into one of Moka’s 5 diversified ETF portfolios specific to your risk tolerance.

The app rounds up the change you get in your transactions when shopping or purchasing online with your nominated bank account. The platform distributes that change into your investments, so you never feel the pinch.

Who is Moka designed for?

Moka is a robo-advisory service designed for new, hands-off investors looking for a passive investment strategy. Moka does the hard work of finding the right investments and managing your money. You sit back and watch your account balance grow without lifting a finger.

What can you invest in with Moka?

Your Moka account funds are under management by the registered Canadian portfolio manager, Tactex Asset Management. Tactex is a subsidiary of Moka Financial Technologies Inc.

Your portfolio manager invests the funds in a diversified portfolio of low-cost ETFs, with the option of investing in a registered investment account like TFSA and RRSP or a personal non-registered and taxable account.

Moka manages your account based on your risk tolerance, investor profile, financial goals, and investment horizon, offering the following 5 portfolio options for investing.

• Conservative Portfolio: 100% investment in savings accounts.
• Conservative-Moderate Portfolio: 40% savings account and 60% Government bonds.
• Moderate Portfolio: 60% Government bonds and 40% stock.
• Moderate-Aggressive Portfolio: 40% Government bonds and 60% stock.
• Aggressive Portfolio: 20% Government bonds and 80% stock.

The Moka SRI fund is a socially-responsible investment account, so you can invest in companies dedicated to building a better society and planet.

How much does Moka cost?

If you want to start with Moka, you have two account options.

The Moka basic account costs $7 per month. You get the following services.

• Automatic saving.
• Unlimited account types (unregistered, TSFA, or RRSP).
• Socially-responsible investment portfolios.
• Round-up your change to charity.
• Cashback perk.

Pros and cons

Weathsimple Invest is one of the leading asset managers in Canada. You get access to an intelligent portfolio of ETFs with low fees and portfolio allocation to meet your investment goals.

This Toronto-based investment management firm gives you access to over 60 different portfolio options consisting of 42 ETFs from 9 different providers. Justwealth has portfolios for any investment strategy and risk profile.

Launched in 2013 by founders Chris and Tea Nicola, CI Direct offers you a hybrid service featuring robo-advisors and human certified financial planners. The company invests your money in ETFs to diversify your portfolio risk. You get affordable management fees between 0.35% to 0.6%, depending on your account balance.

FAQs

Is Moka safe?

Yes, Moka uses the same encryption level as the big banks. The company has never been hacked, and your funds are insured by the Canadian Investor Protection Fund (CIPF) up to $1 million.

Is there a minimum investment required?

You can start investing with Moka with as little as $1.

Can you lose money investing with Moka?

You can lose money in any investing strategy. It’s for this reason that Moka assesses your risk tolerance when signing up for the platform. However, Moka invests in a diversified portfolio, spreading your risk. Moka also invests in ETFs covered by the Canadian Investor Protection Fund.

How does Moka make money?

Moka imposes management fees on your account. You can opt to cover a monthly management fee of $7 for the basic service.

Can Moka be set up as a Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP)?

Yes, you can set up your Moka account as a non-registered account, a Tax-Free Savings Account, or as an RRSP.

Verdict

If you are looking to build a savings or investment habit, Moka is an excellent option. With no minimum account requirement, Moka’s rounding up strategy means you can build your savings or investments painlessly. Though it’s a little costly relative to competitors, Moka offers a flat fee for management so you know exactly what it will cost you and the cashback and discounts from the Moka Perks program will help you reach your savings and investment goals even faster.