If you’re looking for a robo-advisor to automatically manage your employer-sponsored retirement plan, you probably already know that there are a ton of options out there. One of the top contenders is Blooom. They offer a flat monthly fee and focus specifically on defined contribution plans like 401(k)s.

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We’ll walk you through Blooom’s process so you can discover if it’s the right fit for your investment goals.

Plan Overview

Blooom specifically manages defined contribution plans from employers. These include 401(k)s, 403(b)s, 457s, 401(a)s and thrift savings plans (TSPs). So instead of making your own investment allocations with your workplace retirement account, you can have Blooom’s algorithms do it for you.

A great advantage of using Blooom is that there’s no account minimum. Even if you’re just starting to build your retirement funds, you can open an account, which is a huge bonus considering many robo-advisors require a minimum of $10,000 or more.

How much will you pay for Blooom to manage your account?

The fee is a simple flat rate of $10 per month, no matter how large or small your account balance may be. This simplifies the process of having to figure out what you’ll be paying each month based on a percentage charged by most financial advisors.

If you have more than one 401(k) account, you get a slight discount for adding those on as well. You’ll only pay $7.50 per month for each additional retirement account.

Of course, that also means the lower your account balance, the higher percentage your fee may be. We’ll talk more about that soon to help you determine whether or not Blooom is worth it for your personal scenario.

Getting Started with Blooom

In order to check out Blooom’s services, they offer the first month free. Plus, you can create an account without actually signing up for their services. When you do that, you get a free analysis of an existing 401(k).

You’ll then receive suggestions on how to improve your current allocations. Since this is a free service, you’re not obligated to sign up for any additional services at this point and could certainly implement any of the suggested changes on your own.

The upside to using Blooom to manage your account, though, is that you’ll keep getting this advice throughout the life of your 401(k), no matter what the balance may be. Plus, even as your balance grows, that $10 monthly fee stays the same so over time, you could potentially save money on your advisor costs.

Account Services

Blooom uses both automated technology and human advisors so you can get the best of both worlds. At least once every 90 days, your account will be reviewed to see if anything needs to be rebalanced.

This service generally isn’t provided by your employer that you have the retirement account with. You may not realize it, but in most cases, it’s up to you to pick how you want your money invested.

And over time as you age, those allocations should probably change.

Here’s how Blooom helps you with that. First, it looks at what investment options are available in your retirement plan from your employer and classifies them by asset type.

It looks at the lowest expense ratio in each category and selects one for your portfolio, which could potentially save you around $100 each year in fees.

Another service offered by Blooom is fraud monitoring. You’ll receive an alert if any suspicious activity occurs in your account.

We also appreciate that you don’t actually have to move your 401(k) to have Blooom manage it for you. You can simply link any account that has online access.

Customer Service and Support

Although Blooom is a roboadvisor, it also offers a human touch when you need it. You can get support over email or live chat at any time through the website. If you have more specific questions about your investment strategy, you can also talk to a financial advisor over the phone during traditional weekday office hours.

When you first start working with Blooom, you can typically expect them to fix your account within 10 days. Sometimes, however, it can take up to 30 days for them to finish the initial rebalancing.

Finally, if for some reason you decide that Blooom isn’t for you, you can cancel at any time.

Blooom’s Methodology

It’s important to know that Blooom has its own algorithms for allocating your 401(k) based on models and confirmed by financial advisors. Ultimately, though, you’re still in charge of your retirement accounts and can make adjustments as you see fit.

So how does Blooom manage your 401(k) portfolio?

After they choose investments to reduce hidden fees, they use an algorithm based on decades-long market data. They also make choices based on where you are in your career.

If you have at least 20 years left in the workforce, Bloom will more than likely place your entire 401(k) portfolio in the stock market.

The goal here is to maximize your returns because you have time to ride out any potential market ups and downs. If you don’t focus on stock funds, Blooom feels you’ll miss out on big opportunities to really grow your retirement savings.

So what’s Blooom’s approach if you’re getting close to retiring?

Whether you’re nearing retirement or already retired, Blooom switches gears with your 401(k). They’ll still place some of your investments into stocks in order to keep growing for your future years, but they also start switching more of your money to bonds.

Blooom creates a safe balance so that you’re not placing too much risk with aggressive investments, but you’re also still earning money. That way, if the market takes a hit, your retirement plans will ideally be affected at a minimum.

Making Your Own Changes

You still get to have the final say over your retirement account. Once Blooom makes its allocations in your 401(k), you can choose to make whatever changes you prefer. All you have to do is click a simple button called” Adjust Allocation” and you can tweak your account.

As your retirement plans change, you can also “Adjust Retirement.” Blooom uses your target retirement date as part of the algorithm. If you decide to retire early or stay in the workforce a few more years, be sure to update that information so your allocations are as targeted as possible.

Is Blooom Worth It?

It really depends on your asset amounts. When you compare the flat fee of $10 per month to how much you have invested in your 401(k), look at that number as a percentage.

If your balance is $10,000, your $120 in annual fees equals 1.2%. That’s a lot higher than most other robo-advisors and likely higher than even a human financial advisor.

But what happens when you bump that account number up to $100,000?

The total monthly fees for the year come to just 0.12% — which is incredibly low! So you really have to look at the numbers and weigh them against your other options to determine what works best for your account as it stands today.

Since there’s no charge to cancel, and you never transferred your funds so they stay exactly where they are, it’s easy to wait to use Blooom until your 401(k) has reached a threshold where the services make financial sense.

Don’t Forget About the Limitations

You also need to remember that Blooom has restrictions on the types of accounts it can manage on your behalf. You’re basically limited to employer-sponsored plans like a 401(k) or 403(b). If you have other accounts, such as IRAs, you’ll have to pick another service to manage them.

If you don’t mind working with multiple advisors and/or robo-advisors, then that can work out just fine. But if you want to streamline all of your investments into a single source, then Blooom probably isn’t right for you.

Bottom Line

The bottom line is that Blooom is easy to use, customer-centric, and extremely transparent. These are great qualities to look for in your robo-advisor.

If you’re looking for a way to maximize your workplace retirement plan, it’s definitely worth giving this niche-advisor a chance.

With that flat monthly fee, you really don’t have much to lose. Plus, you can even just sign up for a free analysis to see what kind of impact Blooom could have on your retirement savings.