Review of improvement

Select’s editorial team works independently to review financial products and write articles that our readers will find useful. We may receive a commission when you click on product links from our affiliate partners.

Investing alone can be intimidating, but a robot advisor can be an affordable way to start.

Robots are exactly what they sound like: robots. They use algorithms and computer data to create and manage investment portfolios for their users. When you open an account, you fill out a quick quiz about your goals, timeline, and risk level, and from there, you don’t have to lift a finger. Robo-advisers will even rebalance your portfolio for you as the market changes.

Betterment was one of the first robotics advisory platforms on the market, and it has long had a good reputation as an automated investment platform. Select ranked it as the “best overall” on our list of top robo-advisors for several reasons: no minimum balance is required and the annual account fee is 0.25% of your fund balance. . Moreover, even though it is an automated service, users can have access to a real financial advisor. (Learn more about our methodology for selecting the best robo-advisors.)

Below we review the Betterment platform to give you all the details about its investment options, features and fees so you can decide if it is right for your money.

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Review of improvement

Improvement

On the secure Betterment site

  • Minimum deposit and balance

    The minimum deposit and balance requirements may vary depending on the investment vehicle chosen. For Betterment Digital Investing, minimum balance of $ 0; Premium Investing requires a minimum balance of $ 100,000

  • Costs

    The fees may vary depending on the chosen investment vehicle. For Betterment Digital Investing, 0.25% of your fund balance as an annual account fee; Premium Investing has an annual fee of 0.40%

  • Premium

    Up to one year of free management service with a qualifying deposit within 45 days of registration. Valid only for new individual investment accounts with Betterment LLC

  • Investment vehicles

  • Investment options

    Stocks, bonds, ETFs and cash

  • Educational resources

    Betterment RetireGuide ™ helps users plan for retirement

Advantages

  • Minimum deposit of $ 0
  • No transaction or transfer fees
  • Good for automated investing
  • Customizes users’ portfolios based on their financial goals, time frame, and risk tolerance
  • Users can assign specific investment objectives (short and long term) to each portfolio and invest using different strategies (less and more risk)
  • Quick and easy account creation
  • Able to sync external retirement accounts with your Betterment retirement goal so all of your accounts are in one place
  • Premium plan users have unlimited access to a financial advisor (otherwise, ad hoc consultations with an advisor cost between $ 199 and $ 299)
  • Advanced features include automatic rebalancing, tax saving strategies and socially responsible investing
  • Betterment RetireGuide ™ helps users plan for retirement

The inconvenients

  • 0.25% annual account fee
  • 0.40% annual account fee for the upgraded premium plan
  • The Premium plan requires a minimum balance of $ 100,000

Improvement investment options

The Betterment Portfolio is made up of low cost, diversified ETFs, which is essential for maintaining low risk when investing in the market. More advanced investors, however, have the flexibility to customize through Betterment’s flexible portfolios.

Betterment clients can also invest in traditional, Roth or SEP IRAs, and Betterment offers a 401 (k) for employers.

Many Betterment reviews mention the platform’s user-friendly financial dashboard which helps you track your investments and historical performance. Users can also connect other external bank accounts so that they can see all their financial data in one place.

Characteristics

Betterment offers a bit of everything when it comes to robot advisers. In addition to customizing a portfolio for you, Betterment’s advanced features include automatic rebalancing, tax saving strategies, and socially responsible investing.

For the automatic rebalancing function, Betterment will adjust your portfolio every time you make a deposit, withdraw funds, or change your target allocation. Betterment’s algorithms will also check for your portfolio drifts (how far are you from your target allocation) once a day and rebalance as necessary so you can rest assured that your investments are getting the full attention.

Tax Saving Strategies are available to all users and include Tax Loss Harvesting, where Betterment will automatically sell the losing holdings to help offset your taxes. Betterment also provides a “Tax Impact Snapshot” tool that lets you see how much you may have to pay in taxes before withdrawing funds.

Plus, Betterment’s free app has solid reviews. It is available for free download in the App Store (for iOS), where it has 4.8 / 5 stars, and on Google Play (for Android), where it has 4.7 / 5 stars at the time of writing. This article.

Betterment doesn’t offer clients the ability to buy and sell individual stocks, so those looking to trade will need to link it to another platform like Robinhood or Webull. (Check out Select’s list of the best investing apps for more information.)

Costs

There is no minimum balance required to invest with Improvement, and the annual account fee is only a small 0.25% of your fund balance. So, if you invested $ 5,000 with Betterment, you would only pay $ 12.50.

Investors with a balance of $ 100,000 can upgrade to the premium plan, which gives you unlimited access to real financial advisers for an annual fee of 0.40% of your fund balance.

If you don’t have that much money invested, you can pay for one-off consultations with an advisor, which cost anywhere from $ 199 to $ 299.

Those who sign up for a new Betterment account can take advantage of a welcome bonus: up to one year of free management service with a qualifying deposit within 45 days of signing up (only valid for new accounts from individual investment with Betterment).

At the end of the line

Regarding robo-advisers, Improvement is the obvious choice for many. Investors get the personalized portfolio, along with automated rebalancing, tax saving strategies, and access to a human advisor when they need it.

While Betterment is good for any type of investor, women can also consider Ellevest. Ellevest will create and manage a personalized investment portfolio for you, but it stands out because the algorithms on its platform take into account important realities in women’s lives, such as pay gaps, career breaks and increase in life expectancy, so that women can have a real idea of ​​their situation. financially.

Catch up on Select’s in-depth coverage of personal finances, technology and tools, well-being and more, and follow us on Facebook, Instagram and Twitter to stay up to date.

Our methodology

To determine which robo-advisors offer the best services to investors, Select reviewed 22 different platforms. We then narrowed down our top picks taking into account the following factors:

  • Minimum Account
  • Account, advisory, trading and fund fees
  • Investment vehicles offered
  • Selection of investments
  • Educational tools and resources
  • Customer service
  • Sign-up bonus

After reviewing the above features, we based our recommendations on the platforms offering the lowest fees, the widest range of investment options, usability, and all the unique features like access to a human advisor. . We also looked at each company’s customer support structure and app ratings.

Your investment income via a robo-advisor is subject to market fluctuations. Your income also depends on the associated fees and contributions you make to your account. There is no guarantee that you will get a certain rate of return or that current investment options will always be available. To determine the best approach for your specific investment objectives, it is recommended that you speak with a reputable fiduciary investment advisor.

Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.


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About Myra R.

Myra R.

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