Wells Fargo For Investing: Is It A Good Choice?

Wells Fargo is a financial services company that provides investment, banking, mortgage services, and products. It is one of the biggest banks in the world, and offers a range of investment services, including stocks, bonds, and funds. Wells Fargo also provides investment advice and wealth management services. The company's investment services include Intuitive Investor, a robo-advisor service with a low account minimum of $500 and a flat-rate fee structure. However, Wells Fargo stock itself has been described as a risky investment. So, should you use Wells Fargo for investing?

Wells Fargo's Intuitive Investor: a streamlined, no-frills platform with a low account minimum of $500

Wells Fargo's Intuitive Investor is a streamlined, no-frills platform with a low account minimum of $500. It is a great option for new investors with a low account balance, as they can open an account without meeting the minimum opening requirements.

Intuitive Investor offers a quick and easy account setup process that can be done completely online. With a minimum investment of $500, investors can start working towards their investing goals right away. During account setup, you will be asked a few questions about your goals and risk tolerance, and based on these answers, Intuitive Investor will suggest a portfolio for you.

The platform offers two investment styles: Globally Diversified and Sustainability Focused. Your suggested portfolio will be comprised of seven to 11 exchange-traded funds (ETFs) selected to meet your optimal asset allocation and predetermined portfolio objective.

Intuitive Investor provides automated investment services and access to financial advisors at no additional cost. The platform monitors your portfolio daily and automatically rebalances it as needed to preserve your target asset allocation.

The annual advisory fee for Intuitive Investor is 0.35% of your account balance, plus the expense ratio of the specific investment funds. This fee is assessed quarterly and is not adjusted for market fluctuations within the quarter. There are also additional fees for certain transactions, such as outgoing account transfers and wire transfers.

Overall, Wells Fargo's Intuitive Investor is a user-friendly and low-cost option for new investors or those with a limited amount to invest. It provides a hands-off approach to investing, allowing you to set up your account and let it run on autopilot. However, if you are looking for more investing choices or customised options, you may need to look elsewhere.

Wells Fargo's stock performance and analysis

Wells Fargo's stock (WFC) has shown resilience, and the company's financial results are robust. In 2023, the company's revenue increased by 5.99% compared to the previous year, and earnings increased by 43.15%. According to analysts, the average rating for WFC stock is "Buy," with a 12-month stock price forecast of $63.42, an 18.11% decrease from the latest price.

The company operates in four main segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth and Investment Management. It provides diversified banking, investment, mortgage, and finance products and services.

Wells Fargo's stock has been affected by various factors, including the 2016 fake accounts scandal, which resulted in a $1.95 trillion asset cap. However, the company has been working to address compliance issues, and in February 2024, the Federal Reserve lifted a consent order related to the scandal, causing a jump in stock price.

Additionally, Wells Fargo's stock has been influenced by the 2024 U.S. presidential election, with former President Donald Trump's victory leading to expectations of looser regulatory policies and potential tax cuts in the financial sector. This caused bank stocks, including Wells Fargo, to rise.

Overall, Wells Fargo's stock performance and analysis indicate that it is a stable investment option, particularly for those seeking a hands-off approach with a low minimum balance. The company's financial results and analyst ratings are positive, and the stock has shown resilience and the ability to bounce back from scandals and regulatory issues.

Wells Fargo's credit card offerings

Wells Fargo offers a range of credit cards with different benefits and rewards. Here is a summary of some of their credit card offerings:

Wells Fargo Active Cash® Card

The Wells Fargo Active Cash® Card is one of the best flat-rate cash-back cards available. It offers unlimited 2% cash rewards on all purchases with no bonus categories or earning caps. New cardholders can earn a $200 cash reward bonus by spending $500 within the first three months. This card also comes with benefits such as 24/7 concierge service and cellphone theft and damage coverage. There is no annual fee, but there is a 3% foreign transaction fee.

Wells Fargo Reflect® Card

The Wells Fargo Reflect® Card offers a lengthy 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers, after which a 17.49%, 23.99%, or 29.24% variable APR applies. Cardholders can also earn cash back through participating merchants with My Wells Fargo Deals. There is no annual fee, but there is a 3% foreign transaction fee. This card also includes benefits such as up to $600 of cell phone protection against damage or theft, subject to a $25 deductible.

Wells Fargo Autograph℠ Card

The Wells Fargo Autograph℠ Card is a good option for earning rewards in popular spending categories. It offers 3X points on restaurants, travel, gas stations, transit, select streaming services, and phone plans, and 1X points on other purchases. New cardholders can earn 20,000 bonus points by spending $1,000 in the first three months, which has a $200 cash redemption value. There is no annual fee, but there is a 3% foreign transaction fee. This card also includes benefits such as up to $600 of cell phone protection, subject to a $25 deductible.

Wells Fargo Autograph Journey℠ Card

The Wells Fargo Autograph Journey℠ Card is Wells Fargo's first card with transferrable travel rewards. It offers excellent returns for hotel and airline purchases, with 5X points on hotels, 4X points on airlines, 3X points on other travel and restaurants, and 1X points on other purchases. There is a $95 annual fee, which can be partially offset with a $50 airline credit. This card also includes benefits such as trip interruption/cancellation coverage, lost luggage reimbursement, travel accident insurance, and cell phone insurance.

Choice Privileges® Mastercard®

The Choice Privileges® Mastercard® is a good option for those who frequently stay at Choice Privileges locations. It earns 15X points per dollar spent at eligible Choice Privileges locations, 5X points on stays at participating Choice Hotels properties and on Choice Privileges point purchases, 3X points on purchases at gas stations, grocery stores, home improvement stores, and phone plan services, and 1X points on other purchases. New cardholders can earn 40,000 bonus points by spending $1,000 in the first three months, which can be redeemed for up to 5 reward nights at select Choice Hotels® properties. Additional fees may apply. This card has no annual fee and offers benefits such as Elite Gold status with Choice Privileges and zero fraud liability protection.

Wells Fargo's investment types and products

Wells Fargo offers a range of investment types and products to its customers. The bank provides investment and insurance products through Wells Fargo Advisors, a trade name used by Wells Fargo Clearing Services, LLC (WFCS) and Wells Fargo Advisors Financial Network, LLC. These are separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

Some of the investment options available to customers include:

• Stocks: Common and preferred stocks are available, with common stock being the most common type issued by companies. Stocks offer the potential for long-term growth but may fluctuate more and provide less current income than other investments.
• Bonds: These function as loans to governments or institutions, with regular interest payments made to the investor. Bonds typically provide more stability than stocks but have historically yielded lower returns.
• Mutual Funds: These funds allow investors to pool their money in a professionally managed portfolio, offering diversification through stocks, bonds, and other investment types.
• Exchange-Traded Funds (ETFs): ETFs are baskets of securities traded on a stock exchange, similar to individual stocks. Investors purchase shares of the overall fund rather than individual investments.
• Annuities: Annuities are contracts between the investor and an insurance company, where the insurer agrees to make payments to the investor, either immediately or in the future.
• Brokered Certificates of Deposit (CDs): These are certificates issued by banks and sold in bulk to clients by securities firms.

Wells Fargo also offers various accounts for self-directed investing, automated investing, and full-service financial advisors. The bank provides investment services such as IRAs and 401(k) rollovers, retirement planning, and market insights. Additionally, Wells Fargo has a division called Wells Fargo Wealth & Investment Management (WIM), which offers financial products and services through its bank and brokerage affiliates.

One of Wells Fargo's notable investment products is the Intuitive Investor platform, a robo-advisor service with a low account minimum of $500. This platform provides a hands-off approach to investing, with automatic portfolio suggestions based on risk tolerance and goals.

Wells Fargo's fees and commissions

WellsTrade® Fees

WellsTrade is the online brokerage service offered by Wells Fargo. It provides competitive and clear pricing for various investment options. Here are the key fees associated with a WellsTrade account:

• Stocks and Exchange-Traded Funds (ETFs): $0 commission for online or automated telephone trading. However, there is a $25 agent-assisted trading fee for trades placed over the phone.
• No-Load, No-Transaction Fee (NTF) Funds and No-Load Transaction Fee Funds: $0 commission for online trading or automated telephone trading.
• Options Exercises and Assignments: $25 agent-assisted stock commission. Options involve risk and may not be suitable for all investors.
• Auction of Treasury Bills, Notes, and Bonds: Subject to markup or markdown.
• All Other Fixed Income Transactions: Subject to markup or markdown.
• Account Research/Document Retrieval: $15 per hour (minimum one-hour charge) or $5 per document.
• Outgoing Account Transfer: Varies, but typically referred to as a "Termination Fee" on client statements.
• Retirement Account Fees: May include IRA Termination Fee, which is typically waived for clients over a certain age or in specific circumstances.
• Foreign Financial Transaction Fee: Charged by some foreign governments on purchases and sales of securities of companies incorporated in their countries.
• Cash Management Services: Various fees for deposited/cashed item chargeback, overnight delivery of checks, unsettled trade prepayment, etc.
• Outgoing Domestic and International Wire Transfers: $0 fee for online wires initiated by the client. Fees apply for requests made by a Wells Fargo team member.
• American/Global Depositary Receipt Fee Pass-Through: Passed on to the client if imposed by agents for foreign securities.
• Deposit/Withdrawal at Custodian: $250 for outbound transactions.
• Outside Investment: Annual fee per security.
• UBTI 990-T Tax Filing: Annual fee per security.
• Physical Securities Fees: Various fees for physical certificate issuance, replacement of lost certificates, etc.

Intuitive Investor® Fees

Wells Fargo Intuitive Investor is a robo-advisor service that offers a streamlined, no-frills platform for investing. Here are the key fees associated with this service:

• Annual Advisory Fee: 0.35% of the account balance, assessed quarterly. This fee can be reduced by linking the Intuitive Investor account to specific Wells Fargo checking accounts.
• Expense Ratio of Investment Funds: Ranges from 0.07% to 0.14% of asset value, depending on the investment portfolio.
• Account Maintenance: $0.
• Minimum Account Balance: $0.
• IRA Termination: $49.95.
• Outgoing Account Transfer: $49.95.
• Outgoing Domestic Wire Transfer: $30 each.
• Outgoing International Wire Transfer: $40 each.

Other Fees and Commissions

Wells Fargo also charges additional fees for specific services, such as margin accounts, which allow customers to borrow money to extend their financial reach. These fees are subject to change and may include interest rates and other charges.

It's important to note that Wells Fargo Advisors, the group of financial advisors associated with Wells Fargo, may receive compensation from fund company complexes in various forms, including networking fees, revenue sharing, training and education support, and other forms of remuneration. These fees are generally passed on to the customer.

Frequently asked questions