Betterment

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Consumer Complaints and Reviews

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Satisfaction Rating

I opened a retirement and a wealth builder account with Betterment on September 15 when DIJ was at 18,034 and SP at 2,125 and I closed both the accounts on November 16 when DIJ is at 18, 850 and SP at 2175. Both indices went up 2-4% during the time frame but my deposits lost more than 1.5%. Looking at what the Betterment claims as the robo-investing in a diversified portfolio. Can anyone explain as to how the value of a diversified portfolio is going down when the market has gone significantly up! How can one expect it to do it better in the long-term. On the contrary, Charles Schwab's Intelligent Portfolio seem to reflect the market. I would advise investors to keep a close watch on their portfolio.

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Satisfaction Rating

Betterment seems to perform two functions, they are a phishing site to collect personal information which they refuse to delete and a front for Vanguard funds. It is amazing that the best investments emanate from Vanguard and Schwab. The investments they propose would indicate they get a commission from the seller and a fee from their client. My opinion - a bunch of lowlifes.

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Satisfaction Rating

Agents were very thorough and efficiently walked me through the process. I was very pleased with the results and have lower payments now. There's a broad level of customization options available to create a portfolio that works and fits with just about every income. I was pleased with this product. There were no additional fees that I recall, unless they were hidden within the monthly installment. Overall, the cost was a bit high, but fair, considering what you get out of it. It took some time to get used to the interface, but once I was acclimated to it, I was working it like a professional. It's very nice to have a product you can use yourself, rather than paying an individual to do it for you.

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Satisfaction Rating

They care and give great quality customer service. It was easy and very helpful. I had no problems and it gave me great pleasure and they put me at ease for my request. The customization options were great and easy to choose from. Had a great variety of options. I will use them again in the future and will continue. The fees were not that much and it was convenient and very easy to understand. There were no problems and there wasn't any hesitation into my decisions. I was at great ease using this because I felt confident in my decisions and knew I would not change my mind and will come back again.

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Satisfaction Rating

The customer service was great. Any time I called having a question with anything, the workers were always very friendly and helpful with answering my questions. The customization options are great. I like that they offer many and that I was able to choose which one was the closest to matching me and what I could afford at the time. I don't really like the additional fees. I have been fined a few times for things and I just think the fees are expensive and I do not agree with them. I would say the ease of use is great. I have not had any major issues with visiting the website or speaking to someone by phone. Overall I am very pleased.

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Satisfaction Rating

I didn't use customer service much but it is very much evident that they are extremely customer focused by being completely user friendly and easy to contact. The customization options are great. They seemed to have thought of everything when it comes to what a custom experience should be like. I was able to move things around to fit my personal needs. I am not a fan of additional fees but the additional fees that are offered are satisfactory and make sense. In a perfect world everything would be free but that isn't so logical. The ease of use is very good. Navigating the services it offers and other areas within are very much self explanatory, which I admire since I favor being able to figure things out on my own.

on
Satisfaction Rating

I lost 20% of my money. Their strategies are all wrong. It's not worth it even for the reduced fees. You may save a few hundreds in fees but lose a lot in principal. Don't invest. They have no FDIC insurance and regulation. It's a Ponzi scheme. You can lose all your money. It's better with a bank wealth management, they are regulated and insured.

on
Satisfaction Rating

I have been putting some money into this company. It seems like every month I see a loss. I understand the market stinks but is anyone managing this? I would make more money in a traditional savings account. Good thing I only have been putting in trial money.

Expert Review

Barbara FriedbergPersonal Finance Contributing Editor

Barbara Friedberg, MBA, MS is a former investment portfolio manager with decades of financial experience. Friedberg taught Finance and Investments at several universities. Her work has been featured in U.S. News & World Report, Investopedia, Yahoo!Finance and many more publications.    More about Barbara→

Betterment is an automated investment service that helps consumers set and reach investment goals. The Betterment portfolios offer globally diversified investment portfolios with the greatest returns for the lowest risk levels. They offer retirement and traditional investment brokerage accounts.

  • Easy sign-up process: The sign-up takes an average of five minutes and begins with three simple questions; age, retired or not, and annual income.
  • Goal based investing: The investor selects/prioritizes one or all three goals; safety net, retirement and/or general investing. Every choice concludes with links to additional information.
  • Optimized portfolio: The company optimizes their exchange traded fund (ETF) investment portfolios based upon modern portfolio research and offers the greatest returns for the investors indicated risk tolerance level.
  • Low fees: Consumers can start with as little as a $100 monthly auto-deposit. The fee structure begins at 0.35 percent for the auto-deposit of $100 per month until the account value reaches $10,000. The AUM fee drops to 0.25 percent for accounts valued between $10,001 and $99,999. All accounts over $100,000 pay 0.15 percent management fee.
  • Special highlights: The RetirementGuide Calculator tool indicates how much the user must save to meet their retirement spending goals. The SmartDeposit feature automatically transfers excess bank account funds into the Betterment account.
  • Portfolio features: Wealthfront offers portfolio rebalancing, tax efficient exchange traded portfolios and tax-loss harvesting.
  • No outside accounts: All assets are held by the Betterment portfolio custodian and must be transferred to the firm.
  • Best for New and experienced investors seeking low fee, diversified and automated investment management.

Question and Answers - Betterment

What’s the most common misconception consumers have about your industry?

Most people have the misconception that investing has to be complicated and confusing. It makes sense that people would feel that way because, historically, traditional financial services have not offered elegant and easy-to-use platforms for managing investments. Now, utilizing intuitive design and automated tools, Betterment has created a smarter investing experience that has been designed to help provide customers with the best-expected net investor returns for retirement planning, building wealth, and other savings goals.

How has your industry changed in the last 5 to 10 years?

Automated investment services, which offer sophisticated ways to simplify and automate your portfolio and investing strategy, are engineering an inevitable transformation of the entire financial landscape. Why? New technology helps disrupt and streamline stale, inefficient models, rewarding customers with better, smarter solutions.

The creation and popularity of index-tracking ETFs have been essential to our success as an automated investment service, as is cloud-computing, like Amazon Web Services. ETFs allow us to put together incredibly low-cost, liquid portfolios and improve tax efficiency—while cloud-computing allows our engineers to build, model, and test new trading platforms in cost- and time-efficient ways.

All of these benefits are then passed on to customers through lower costs, optimized investment vehicles, and a seamless user experience. This is the new era for investing that improves the way all Americans can grow their money—and increases the likelihood that they will not only reach their financial goals, but also be happier because they can spend more time doing the things they enjoy.

What problem is Betterment trying to solve?

At Betterment, we’re helping people answer the question: “What should I do with my money?” Our pursuit is to create the perfect automated investing service, helping people to better manage, protect, and grow their wealth through smarter technology. We are building on prior innovation and applying technology in new ways to change the way people manage their money so they ultimately have better outcomes. We start from a place of alignment with the customer and then ask, “How can we use technology to improve his or her experience?” Through smart technology, design and customer experience, we work with individuals to better address their investing needs.

What sets Betterment apart from the competition

Betterment is unique in that it handles every part of the investment process, allowing us to provide a better experience for customers.

What needs Betterment fulfill, and how do you fulfill those needs better than your competition?

Betterment offers a smarter investing experience.

Better Returns: The Betterment portfolio is designed to achieve optimal returns at every level of risk. Through diversification, automated rebalancing, better behavior, and lower fees, Betterment customers can expect 4.30% higher returns than a typical DIY investor.

Customized Portfolio Allocations: Each investment portfolio is designed to get customers optimal investor returns. Our goal-based investing framework and advice algorithm let customers know if they are on track to reach their investment goals, like retirement or a safety net fund.

Automation and Passive Investing: We recommend a globally diversified, passive portfolio of 12 asset classes, tailored for our customers’ risk and time horizon. Years of research and Nobel Prize-winning Modern Portfolio Theory are the foundation of our investment method.

Tax-Efficient Investing: We are built from the ground up to handle every dollar of our customers’ money tax‑efficiently.

Retirement Income: We use technology, investment expertise, and a fresh take on withdrawal methodology to provide sustainable cash flow while our customers enjoy retirement.

Trust Accounts: Betterment customers can create multiple goals—such as growing wealth, saving for education, or distributing income—tailored to each beneficiary.

How does Betterment measure success?

To measure the success of our company, we track a variety of metrics but especially look at assets under management, the number of customers using Betterment, and customer satisfaction.

What is something you wish every consumer knew about Betterment?

It’s easy to get started with Betterment, and our customer experience team is here to serve you 7 days a week.

Has your business received any rewards or recognition for its products or services that your customers would like to know about?

Betterment is a CNBC Disruptor 50 and Webby award winner and has been featured in the New York Times, Forbes, Wall Street Journal, CNNMoney, TechCrunch, Bloomberg, NBC, and Lifehacker, among other news outlets.

How has Betterment grown or evolved?

Betterment is the largest, fastest-growing automated investing service, with more than 50,000 customers and more than $1 billion in assets under management. We’ve doubled our customer base in the last year alone (learn more at https://www.betterment.com/)

We have also implemented a variety of new features:
Tax Loss Harvesting+, TaxMin, and Tax Impact Preview
Improved Portfolio with Municipal Bonds
Retirement Income
Trust Accounts
Better Mobile Apps (with touch ID and portfolio view)

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Betterment Company Profile

Company Name:
Betterment
Address:
61 W. 23rd Street, 5th Floor
City:
New York
State/Province:
NY
Postal Code:
10010
Country:
United States
Website:
https://www.betterment.com/