Navy Federal Digital Investor Review

Navy Federal Credit Union is available to military members and their families. It's digital investor platform allows members to invest in stocks and ETFs via a robo-advisor or in a self directed account.

While a diversified investment portfolio is often a key piece of future financial stability, it’s not always easy to build. Luckily, military members can take advantage of Navy Federal Digital Investor to get started.

In this Navy Federal Digital Investor review, I will explore what Navy Federal Digital Investor is and how it can serve as a platform to create and manage an investment portfolio.

What Is Navy Federal Digital Investor?

Navy Federal Credit Union offers a range of banking products to its members. Additionally, it provides an investment opportunity through its Digital Investor. If you want to use Navy Federal Digital Investor, you’ll need to meet Navy Federal’s military service requirements or be related to someone with sufficient military ties.

What Does It Offer?

Digital Investor with Navy Federal Credit Union allows for both IRAs and taxable accounts. It also has a self-directed option where you can choose your own mix of individual stocks or ETF or you can opt for the robo-advisor version where an algorithm will set your portfolio for you.  

Self-Directed Investments

If you are confident in managing your own investment portfolio, the self-directed investment option might be a good fit. This track allows you to either choose your own investments from over 5,700 individual stocks and exchange-traded funds (ETFs) or select prebuilt bundles to grow your portfolio. That said, Digital Investor doesn’t allow you to buy and sell mutual funds, individual bonds, options, brokered CDs, or other types of securities that may be tradable with larger online brokers.

The self-directed option does, however, come with research tools and real-time trading to help you build your portfolio.

Automated Investing

If you don’t want to select individual securities for your portfolio, the automated investing option could be a good fit. After you answer some questions about your financial goals, Navy Federal’s robo-advisor will match you with one of six portfolios consisting of preselected, low-cost ETFs.

Fractional Shares

When you invest with Navy Federal Digital Investor, you won’t be subject to any minimum balance requirements. And thanks to fractional share options, you can invest as little as $1 per stock, regardless of its share price.

Account Types

The type of investment account you choose to open can have a big impact on your portfolio. Navy Federal offers a relatively limited selection of account types, including taxable individual, joint, and custodial accounts. Additionally, you can find both traditional and Roth IRAs.

Other popular account types, like solo 401(k)s and 529 plans, are not supported.

Are There Any Fees?

Following a free 30-day trial, both the self-directed and automated investing accounts come with a $3.50 monthly fee. But investors who have an Active Duty Checking account with Navy Federal or who are Navy Federal employees will pay only a $2.50 monthly fee.

By comparison, most robo-advisors charge a percentage-based fee ranging from 0.15% to 0.4% or so of a client’s total assets under management, which works out to about $2.50 to $6.67 per month for a $20,000 portfolio.

A monthly management fee of any kind, however, is unusual for self-directed online brokers. And frequent traders should be aware that, although you won’t pay trade commissions for up to 2,000 shares per month, you’ll pay one penny per traded share beyond that monthly threshold.

How Does Navy Federal Digital Investor Compare?

Navy Federal Digital Investor isn’t the only place to build an investment portfolio, and even current Navy Federal members should consider other brokerages before committing to Digital Investor.

Vanguard spearheaded the movement toward passive, low-cost index fund investing, and its wide variety of tradable assets typically makes it a good bet for experienced investors who want to build their own portfolios. Certain asset types you can trade with Vanguard, like some mutual funds, have minimum investment requirements of several thousand dollars. But unlike Navy Federal Digital Investor, Vanguard’s self-directed brokerage doesn’t charge a monthly fee.

Vanguard also offers a Digital Advisor, which can help you automatically invest your funds, provided you meet its $3,000 minimum. Vanguard Digital Advisor charges a management fee of 0.15% of your total portfolio, which is more expensive than Navy Federal’s regular monthly fee if your portfolio’s value is greater than $28,000. And the digital tools offered through Vanguard are a bit outdated, which could make Navy Federal a better choice for those seeking a more intuitive online experience.

If you can’t decide whether you prefer self-directed or automated investing, M1 Finance offers an interesting middle ground. M1 allows you to either build your own portfolio from a selection of over 6,000 stocks and ETFs, or you can choose a premade portfolio based on factors like your risk tolerance and planned retirement age. Either way, there are no trading or management fees. If market changes cause your asset allocation to drift away from your preferences, you can instruct M1 to rebalance your portfolio for you.

Like Navy Federal, M1 offers more than just its investment platform. The annual percentage yield (APY) for M1’s high-yield savings account is usually competitive with the best high-yield savings accounts on the market; its credit card offers up to 10% cash back when shopping with partner brands; and its personal loans have competitive annual percentage rates (APRs). But you’ll have to pay a monthly fee if you want to access those products.

How Do I Open An Account?

The process of opening a Navy Federal Digital Investor account starts by opening a Membership Savings account, which is a baseline requirement for membership in this credit union. If you don’t have a Membership Savings account already, be prepared to provide your Social Security number, a government ID, your home address, and funding information for the minimum $5 deposit.

Once you are a Navy Federal Credit Union member, you can sign up for the Digital Investor account. It’s as simple as clicking the ‘open automated account’ or ‘open self-directed account’ buttons on the platform’s website. From there, you’ll be directed to sign into your Navy Federal account to provide details and finalize your account. 

Is It Safe And Secure?

Navy Federal is a trusted credit union with National Credit Union Administration (NCUA) insurance. With that, funds held in Navy Federal’s deposit accounts are protected for up to $250,000.

In terms of your investments, there is always a risk that your assets will decrease in value. However, if Navy Federal goes out of business entirely, its insurance from the Securities Investor Protection Corporation (SIPC) protects up to $500,000 worth of securities.

How Do I Contact Navy Federal Digital Investor?

If you need to get in touch, you can find help through the live chat feature available weekdays from 8 a.m. to 8 p.m. Eastern time. You should expect a good experience when you work with Navy Federal, based on its positive Trustpilot ratings.

Is It Worth It?

Navy Federal members who want to manage their entire financial picture in a single place might find it convenient to use the Digital Investor service. You can choose either a self-directed or automated investing track to build an investment portfolio, so there are options for both experienced investors who are comfortable making their own trades as well as those who are just starting the investment journey. But the same monthly fee applies either way. And while that fee is affordable if you’re interested in automated investing and you plan to build a high-value portfolio, it’s an unusual charge for a self-directed account.

If you’re ineligible to invest with Navy Federal due to a lack of military ties — or if you’re unimpressed by its fee structure and the limited types of securities it supports — consider exploring competing robo-advisors or self-directed online brokers.

Navy Federal Digital Investor Features