Robo-advisors differ from normal financial advisors in three main ways: they manage your portfolio primarily through automated software (rather than having humans pick stocks and bonds for you), they’re much cheaper than traditional financial advisors, and they custom-build an efficient portfolio for you based on your very own personal risk profile. (“Efficient”, here, is a technical term: it means a portfolio on the “efficient frontier”, where you get the lowest amount of risk for any given return, or conversely the highest return for any given level of risk.)
The excellent Felix Salmon explores one of the fastest growing segments of the wealth management industry. His exploration of the asset allocation to cash that Schwab Intelligent Portfolios take is one that many Kiwisavers might find interesting, but his broader theme that investing comes after you have no debt and emergency savings is something pretty important for Millenials.
If you read the reports you get from your Kiwisaver provider, you may find that a higher allocation to cash than you expected is there, which is an interesting situation to be in and further reinforces arguments made by the likes of NZIER that Kiwisaver is important in household asset allocation and obviously diversification away from residential property.