Is a robo-advisor right for you?

Quite simply, a robo-advisor is an automated online investment advisory service. This type of wealth-management solution has been gaining a foothold in the asset management industry of late. Along with providing automated, algorithm-based portfolio management advice, some robo-advisors offer automatic portfolio rebalancing and tax-loss harvesting.

A robo-advisor provides investors with automated, algorithm-based portfolio management advice without the use of human financial planners. Robo-advisors use the same software as traditional advisors, but usually only offer portfolio management and do not get involved in more personal aspects of wealth management, such as taxes and retirement or estate planning.

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So begs the question on many investors' minds: Is a robo-advisor better than a human one?

Industry veteran Elliot Weissbluth, founder and CEO of wealth-management firm HighTower Advisors, believes a balance exists. The future of financial services will involve a combination of the best of both worlds: the ease and simplicity of technology, coupled with the skilled and holistic human touch, he explains.

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Combining the human touch of traditional financial advisors with the logic, fee transparency, methodology and accessibility offered by robo-advisors is a powerful combination for investors. Clients can access their portfolios and much of the advice they may need online but can still receive the hand-holding and personal advice they need from a human.

Going forward, the best financial advisory firms will combine the best of client-centered technology and the benefits of the human touch in providing advice, Weissbluth believes.