2021 Betterment Review: Benefits and Downfalls

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If you’re all about achieving financial goals and being a boss at managing your finances, Betterment is for you.

Betterment is a financial platform that assists in personalized investing to help you make a plan, build wealth, and work towards meeting your goals. 

Today’s post goes over:

  • Benefits of Betterment 
  • Features of Betterment 
  • Who should use Betterment
  • Alternatives to Betterment 
  • How to get started with Betterment
  • Fees

If I had heard of Betterment before I started using Vanguard, I would’ve went with Betterment. Still, I created an account with Betterment to share my experience with you guys. And I have to say, I love the how user-friendly the site is. They literally help you step-by-step in the process, which is perfect for the beginner investor.

Before we get started, make sure to sign up for my free resource library and get tons of free printables to help change your financial life.

What is Betterment?

Betterment is an automatic investing platform and cash management service with over 500,000+ customers and $21 billion in assets. 

They’re making huge strides for helping the beginner investor get started with their financial goals. Betterment also acts as a fudicary which means they legally have to act in your best interest. 

Benefits of Betterment 

  • Unique customization based on your needs and goals
  • No account minimum
  • High-yield cash account
  • Peace of mind knowing your investments are in an optimized portfolio
  • Set up an account in minutes
  • Hands-off saving and investing

Below is one of the reasons Betterment is awesome. They give you regular financial check-ups to make sure you’re on track to reach your financial goals. They also tell you where you need to get back on track.

Features of Betterment 

  • Checking account
  • Cash reserve
  • iOS and Android mobile app
  • Create investment goals that are tailored to you
  • Member of SIPC (account protection)
  • Customer service support
  • Tax loss harvesting

What accounts can I open in Betterment? 

  • Roth IRA
  • Traditional IRA
  • SEP IRA (single participant only)
  • Inherited IRA
  • Individual taxable accounts
  • Joint taxable accounts with rights of survivorship
  • Trust accounts
  • Cash Reserve- a high-yield cash account
  • Checking account provided by nbkc bank, Member FDIC.

Fees

I’ve copied and pasted Betterment’s fees below which comes directly from their website.

Cash Reserve: No fees on your balance. Betterment LLC only receives compensation from our program banks, and we do not charge fees on your account balance.

Checking: No monthly account fees, maintenance fees, or withdrawal fees, and all ATM fees worldwide will be reimbursed, including the Visa 1% transaction fee on foreign transactions, purchases, and ATM transactions‡.

Investing: 0.25% per year on your invested balance, which covers all trading costs. Also, there are no additional transaction fees. Every fund your portfolio invests in charges fund fees that, in total, range from 0.03% to 0.50%.

Retirement: You can access our retirement planning tools without funding an account simply by syncing your existing accounts. Once you transfer retirement assets (like an IRA) to Betterment, Betterment will charge you a 0.25% management fee.

Premium Advice: 0.40% per year on your invested balance for unlimited over-the-phone access to our team of CFP® professionals.

No minimum balance requirements across the majority of our accounts—however, if you opt into the Premium plan, there is a $100,000 minimum.

When you click here, Betterment will manage $5,000 of your investment balance free for a year. 

Who should use Betterment

  • U.S. Citizens ages 18+
  • Hands-off investors
  • Investors saving for retirement
  • Individuals with low balances
  • Individuals who want ease and help along the way

Is my money safe?

Betterment is a member of SIPC. This protects securities customers of its members up to $500,000, including $250,000 for claims for cash. With cash management products, your money is insured by the FDIC.

How to get started with Betterment

1. Get signed up.

Sign up here and fill out information like your name, address, bank checking account. Do you want to open a no-fee checking account? Invest for retirement? Save for weekly groceries? 

Whether your goals are being more intentional with your spending or investing for retirement, Betterment can help you. 

2. Tell Betterment what you want to do with your money.

Once Betterment knows what you want to do with your money, they will provide recommendations and set up your account. 

3. Betterment will help build your account and give you recommendations on setting up your ideal account.

Every dollar will be put to good use whether you spend, save, or invest with Betterment. Betterment’s technology manages your money and sets the path to make you more money.  

4. Do what you want with your money.

Now you can save, with draw, or spend your money in a way that you choose. Betterment helps you achieve your financial goals. Once you meet your first goal? Betterment will help you reach the next.

Alternatives to Betterment

Vanguard

You will hear about Vanguard time and time again due to it’s low-cost investing. It’s great for investors who are in it for the long haul and investing for retirement.

I personally have my Solo 401(k), Roth IRA, and Traditional IRA with Vanguard and love their customer service.

Robinhood

Robinhood is a trading app known for being commission-free. It has a clean and simple dashboard making it a great option for beginner investors.

With Robinhood, you can invest any amount of money, build a balanced portfolio, and trade in real time. Not only that, Robinhood also has tools to help you learn about investing in financial markets.

Click here to get a free stock. You don’t need any money in your account to get your free stock.

Related: How To Use The Robinhood App For Beginners

WeBull

WeBull is a free commission trading app with many benefits and features that make it superior to similar trading apps. WeBull is designed for intermediate and experienced traders, with many tools that beginner traders will enjoy as well.

They use a commission-free structure that allows active and short-term traders to save a good chunk of money on commissions when compared to other online brokers.

If you’re ready to get started with WeBull, you can sign up for an account here. Once you deposit $100, you can get free stock worth up to $1,000.

Related: WeBull Review: Investing In Stocks

Acorns

Acorns is mobile app that makes it easy to make responsible financial decisions that fit your lifestyle. The “Round Ups” tool is my favorite part of the app. For example, if you buy a $3.40 coffee from Starbucks, the Acorns app does a “Round Up” and takes the remaining $.60 and invests it. 

This is how Acorns works:

  1. Sign up for an account in under 5 minutes. You get a $10 sign up bonus.
  2. Download the Acorns app and get started with no minimum investment required.
  3. Invest automatically.
  4. Set aside spare change or extra cash automatically.
  5. Grow your account over time with a diversified portfolio.

Sign up for Acorns here and get a $10 sign up bonus.

How To Build Wealth By Investing Course

If you’re on the fence with active trading and you’re looking to build a solid long-term retirement plan, I recommend taking the How To Build Wealth By Investing course.

For a fraction the cost of a college credit, you get information that teaches you how to have a million (or millions!) in your retirement account when you retire. I bought this course with my own money and cannot say enough good things about it.

This course will teach you how to be like Amanda (pictured below). 

Final Thoughts

Betterment is a dream for beginner investors because it takes the guess work out of what steps you should take to reach a financial goal. They literally take you step by step to create your goal and find a plan that works best for you. And once you meet your financial goal, you can create another goal with the help of Betterment. 

When you sign up for Betterment here, you get a special offer. Betterment will manage $5,000 of your investment balance free for a year.

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