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Frequently Asked Questions

Find answers to frequently asked questions about Betterment.

Is Betterment a good investment?

Betterment is a good option for beginners who aren't ready to invest on their own. It's also good for passive investors who don't want to manage their own portfolios. The $4 monthly fee for balances under $20,000 is reasonable and there is no minimum. But experienced investors could earn better returns by choosing their own investments.

Is my money safe with Betterment?

You retain full ownership of your assets. Even if Betterment were to go out of business, your investments are insured up to $500,000 per account type by the SIPC. Betterment also uses 256-bit SSL encryption to keep your data secure.

Is Betterment worth the cost?

Betterment's $4 monthly fee or 0.25% annual fee is lower than traditional financial advisors. It could be worth it for new investors or if you want to be hands-off. However, if you know how to manage your own portfolio, the fee gets expensive on bigger balances. $100,000 balance costs $250 a year in fees.

How much should I put in Betterment?

Betterment has no minimum investment. Balances less than $20,000 cost $4 monthly advisory fee, and then a 0.25% for balance of $20,000 or more, or if you set up recurring deposits of $250 or more per month. You can deposit as little or as much as you're comfortable with and still have access to benefits such as tax harvesting. If you have at least $100,000, you have the option to upgrade to the Betterment Premium Plan at 0.40% annual fee.

Can I take my money out of Betterment?

You can withdraw funds from Betterment at any time with no withdrawal fees. Withdrawals take about 4-5 days to complete. When you withdraw, your shares are sold off. Any profits will be considered taxable income. If you withdraw funds from an IRA account early, there will be a tax penalty.

Is Betterment better than Vanguard?

Betterment is better for new investors as it has no minimum to start. Vanguard Personal Advisor requires $50,000 minimum. However, the advantage of Vanguard is that you get actual human advisors managing your portfolio. The fees are comparable at 0.25% for Betterment and 0.30% for Vanguard.

Is Betterment better than Fidelity?

Both Betterment and Fidelity Go have a $0 minimum investment. However, Fidelity's annual advisory fee is higher at 0.35% (vs 0.25% for Betterment). Betterment offers more comprehensive services and accounts types. On the other hand, Fidelity has active human managers.