Advisor Resources

7 steps to protect your client’s security in the age of AI Aug 22, 2025 12:05:30 PM Your clients entrust you with their most sensitive financial details. Protecting that information isn’t only a regulatory requirement—it’s essential to maintaining trust and differentiating your advice. Below are practical, actionable strategies you can implement—including a few that have been changing, as artificial intelligence has begun to change the threats that clients face. 1. Password managers and multi-factor authentication One of the most important things you can do to protect clients is to ensure that your team always uses password managers and multi-factor authentication. Multi‑factor authentication (MFA) is generally available in custody platforms (including Betterment Advisor Solutions), email, CRM systems, and any platforms that store sensitive data. It’s one of the most effective, low-cost defenses against account compromises. There is even a handy website that allows you to look up whether a particular platform supports this type of authentication. You can pair MFA with a password manager to ensure your team uses long, unique, and complex passwords for every account—without the burden of remembering them all. A password manager reduces the risk of password reuse, which is a common cause of breaches, and makes it easier to update credentials regularly. Because MFA and password managers are so important, it could be good to go beyond just your firm, and advise clients to make use of them as well. 2. Avoid social engineering—and AI-powered phishing Cybercriminals use phishing and other types of social engineering—through texts, emails, and even voice messages that mimic trusted contacts—to bypass controls from financial institutions. As artificial intelligence technology has become widespread, criminal actors are doubling down on the use of social engineering. They can even use AI voice or video deepfakes to mimic clients or custodians calling in with urgent instructions. As Sam Altman recently warned at a Federal Reserve event: “A thing that terrifies me is apparently there are still some financial institutions that will accept a voice print as authentication for you to move a lot of money or do something else.” He emphasized that “AI has fully defeated most of the ways that people authenticate currently – other than passwords.” To address this risk, it’s important for your firm to have multi-layered verification (e.g., callbacks to verified numbers, code words, or secure portal confirmations) rather than just relying on voice authentication. You may also work with your IT provider to schedule ongoing simulated phishing exercises for training purposes. Remind your team: AI makes impersonation more believable than ever. 3. Encrypt data in transit and at rest Ensure that client data is encrypted during storage and transmission. Start by ensuring that your key service providers have good encryption practices. For email communication that involves sensitive information, use secure client portals instead of email attachments. Also work with your IT provider to ensure that mobile devices and computers are fully encrypted (for example, by enabling BitLocker for Windows or FileVault for Mac); this will help ensure that if a device is lost or stolen, the data remains protected. Pairing encrypted storage with secure transmission methods ensures client information is safeguarded at multiple layers. 4. Scrutinize third-party vendors Many firms rely on outside vendors to manage parts of their business. That’s why financial regulators emphasize oversight of third-party security practices: Client data can still be at risk even if it’s stored by someone else. When vetting custodians, software providers, and other partners, confirm they implement robust security measures—encryption, access controls, incident response plans—and document your due diligence. Many businesses now host a Trust Portal (for example, the Betterment Trust Portal) where advisors can securely access independent audit reports, penetration test summaries, and other compliance materials. Leveraging these resources helps you demonstrate compliance with regulatory expectations while ensuring vendors meet your firm’s security standards. 5. Use AI for monitoring and fraud detection AI isn’t just a threat—it’s also a defense. Advisors can also work with their IT provider to deploy AI-enabled cybersecurity controls like endpoint detection and response (EDR) software, which continuously monitors laptops and other devices for suspicious behavior, such as unauthorized access attempts or malware activity. This adds another layer of proactive protection beyond traditional antivirus tools. To protect client accounts from fraud, platforms like ours flag unusual patterns that may indicate identity theft or other types of fraud, helping detect issues more effectively. Prioritize monitoring these alerts to help prevent fraud before your clients are impacted. 6. Stay current with patches and updates One important bit of security advice has not changed with AI: Unpatched software remains a prime vulnerability. You’ll want to ensure that you have effective processes in place across all systems—including operating systems, apps, and even office devices like printers—and enable automatic updates where possible. It’s also important to have a way to identify and measure the effectiveness of this process. Many IT service providers will use a vulnerability management scanner to identify any devices that have out-of-date software with security vulnerabilities. 7. Create an incident response plan No defense is foolproof. Get ahead of it, and prepare a written incident response plan, identifying roles, communication steps, client and regulator notifications, and recovery actions. Be sure to consider common types of incidents such as a compromise of your business email system, or a ransomware attack. One important consideration to respond to ransomware attacks is ensuring that your firm data is backed up in secure, separate locations. Then you’ll want to do a test run. Check your ability to restore backups, and host a tabletop simulation to clarify roles and responsibilities with your firm, IT service provider, and other business partners. Final thoughts In today’s landscape, protecting client data is essential—not optional. The rise of AI presents both risks (like deepfake impersonation) and opportunities (like monitoring tools). By prioritizing security, you will protect your firm and build trust with clients.

Helping Millennials Match Their Money with Their Values Aug 20, 2025 9:00:00 AM A conversation between Sophia Bera Daigle and the Betterment Advisor Solutions team about building a goals-driven practice for millennial clients. Non-paid client of Betterment. Views may not be representative, see more reviews at the App Store and Google Play Store. Advisor: Sophia Bera Daigle, CFP® After working in traditional financial planning firms since 2007, I quit my job at a NY start-up to launch my own firm, Gen Y Planning. I now live in Austin, Texas with my husband, Bryan, and our son, Theo, who was born in the fall of 2020. After spending several months living abroad in 2019, we’re excited to share our love of travel with Theo! Firm: Gen Y Planning Gen Y Planning brings financial planning to millennials. We now work with a variety of clients in their 20s, 30s, and 40s who are in the middle of making huge life decisions: navigating a new job, buying a home, merging finances, starting a family, relocating, and pursuing advanced degrees. The Gen Y Planning team believes that the earlier you work with a CFP®, the faster you can build a secure financial foundation for the future. Why did you decide to become a financial advisor? I like to help people use their money to match their values. My clients range from creatives to small business owners to Silicon Valley employees. Whether you plan to retire early, take a sabbatical, or build a career you love, I’m excited to help! What is the least understood aspect of your job? I would have to say the least understood aspect of my job is that financial planning does not just mean managing investments. I offer comprehensive financial planning, which includes all areas of your financial life: paying down debt, protecting assets that have been accumulated, purchasing a home, refinancing a mortgage, reviewing job offers and company benefit packages, reviewing tax returns, and proactively tax planning. My approach is goal-driven with my clients in the driver's seat. I work with clients to co-create their recommendations so that they’re more likely to implement the recommendations. Then my team and I act as their accountability partners to see that they are following through on the recommendations so that they can reach their goals. Why did you choose to partner with Betterment Advisor Solutions? I like that Betterment offers robo-advising, which includes automatic rebalancing, at a low, flat platform fee. In addition, Betterment has a simple, user-friendly interface that makes it easy for clients to navigate. Betterment also has great features like effortless Roth conversions and tax-loss harvesting. Something small that I love is the ability to set up an automatic investment weekly instead of monthly. It’s a great way to dollar cost average into the market while also smoothing out cash flow. How have you set up your firm's tech stack? And how has leveraging automation impacted your practice? We utilize a handful of low cost tech tools (Trello, Dropbox, Zoom, TextExpander, Gmail, etc.). We have found that our philosophy of “simple over sexy” has a greater impact on our clients than fancy software with charts and graphs. We don’t pay for expensive financial planning softwares that produce twenty-page reports our clients will never look at. The benefit for us and our clients just isn’t there. We like using Trello to track our clients’ financial goals and life changes and to take notes. We have a board for each client so we can easily prepare for our client meetings. We have a Google form we send to clients before their check in meeting and they update their net worth in Excel. We send them a one-page meeting recap after their meeting in a PowerPoint that we print to PDF. It’s efficient, simple, and the action items that came from the meeting are clear. Can you walk us through what the onboarding experience might look like for a new client at your firm – from when they land on your website to your team actually opening and transferring their assets – and how Betterment may fit into the onboarding workflow? An interested potential client starts by scheduling a 30-minute introductory meeting. They would fill out an intake form prior to our meeting. During the meeting we learn more about them, dive into the services we provide, and end with a quote for our services given their financial situation. After, if they decide they want to become a client, they sign a contract, pay their upfront client fee, and schedule their first client meeting. Prior to this meeting they are given a list of documents to gather and upload to a Dropbox folder for us to review. What is one critical lesson you have learned from your clients? My values and priorities are not necessarily the same as my clients. I need to keep this in mind when a client is making a decision that might not be the best financial decision, but may be a really important life decision that deeply affects other areas of their life. In that case, I want to help them figure out the best way to financially navigate through that choice so that they can continue to reach their goals. How has a remote or hybrid work environment changed your relationship with clients and prospects? I have always run my business remotely, which has a plethora of benefits for clients, the business, and my employees. Clients can meet in the comfort of their home or office and don’t need to worry about commuting to our meeting. It also allows me to work with people across the country and travel myself. It opens my workforce options up to the whole country as well since I don’t require my employees to be in one location and come into an office. I can’t imagine having in-person client meetings again. Now, when I get to see my clients in person, it’s only social! It’s way more fun that way! What do you think is the biggest opportunity for advisors today? I think the biggest opportunity for advisors is in working with the millionaires of tomorrow—young professionals who are making good money but maybe haven’t accumulated much wealth yet. They still need planning in many areas of their lives: paying down student loans, purchasing their first home, negotiating job offers, navigating company benefits and company stock options, starting a family, and saving for retirement. If you could only give one piece of financial advice, what would it be? Don’t wait to start. Small steps have a dramatic impact on your overall financial situation. You don’t want to be shoulders deep in a complex financial situation before you seek help. Find a planner who will be your financial partner to navigate finances with you so you can reach your goals and achieve your dreams.

Tax-aware migration strategies Aug 5, 2025 10:30:00 AM Advisors have three options when migrating a client to a different portfolio or changing their allocation -- each with its own tax-optimization strategy. A tax-aware approach that may reduce short-term gains and limit wash sales When this strategy is selected, the client’s goal will be migrated in a tax-optimized way. For taxable accounts, we’ll seek to sell tax lots that are at a loss or have experienced long-term capital gains, but will continue to hold, when possible, tax lots with short-term gains until they either become long-term gains or become losses. For tax-advantaged accounts, we will migrate without regard to embedded capital gains. Regardless of account type, we will prioritize reducing wash sales that could lead to permanently disallowed losses for securities held at Betterment. For this strategy, it is important to remember that the account may have high drift in the short run, but if rebalancing is on Betterment’s algorithms will typically rebalance available losses or long-term gains as they arise (subject to any customized drift settings or gains allowance on your client’s account), as long as the security sales involved will not cause any disallowed losses. Set Target Only Selecting this migration strategy will disable automated rebalancing in client taxable and tax coordinated goals assigned to the portfolio. While rebalancing is off, the client’s goal will be transitioned to the new target portfolio by buying underweight securities with cash deposits and dividend reinvestments, while selling overweight securities to fund withdrawals. This election will often result in high drift, especially if the portfolio or allocation change involves a significant change in composition of the portfolio’s holdings. You can re-enable automated rebalancing from your client’s household page or by contacting us at support@bettermentadvisorsolutions.com. If you wish to further manage tax impact, you can also set a gains allowance for your client’s goal prior to re-enabling rebalancing. To learn more about how a gains allowance operates in client accounts, please review our smart transitions disclosure. Rebalance with no tax-impact constraints For this migration strategy, the client’s goal will be rebalanced as soon as possible to the target portfolio. Betterment will perform this rebalance in a tax-optimized way to the extent possible, but we will not delay selling shares even if doing so could lead to a more optimal tax outcome. Choosing this option could lead to the realization of wash sales for securities that have been recently sold. After trading is complete on the change, the account will typically be 100% in balance with the target portfolio. For each of these migration strategy options, Betterment’s Tax-Impact Preview feature is available in the individual client goal migration flow so that the advisor may see an estimation of the effects of the selection. Note that Tax-Impact Preview is not available for bulk portfolio updates.

The #1 skill advisors need to help clients navigate the Great Wealth Transfer Jul 9, 2025 1:01:43 PM How your firm can prevent losing business as your clients transfer their wealth. We’ve been hearing about the “Great Wealth Transfer” for years now. There is an estimated $100+ trillion that will pass from baby boomers to Gen X and millennials, but recent data has found that most clients are still not ready for it. The problem? Many families aren’t having essential conversations about how their wealth will be passed down—or who will be responsible for managing it. Here’s how your firm can help. The challenge: Guiding clients through a generational shift Money can be stressful. In Betterment research, we’ve found that 62% of people have moderate to significant anxiety around their finances. Pair together the complexities of financial planning with potentially emotional conversations with loved ones, and many families may feel lost or confused. Recent data shows that many families are underprepared: An RBC Wealth Management–U.S. survey found that only 52% of givers have had conversations about values with their heirs, and just 39% have provided guidelines for what they want to do with their inheritance. Meanwhile, UBS research highlights a gender difference within this gap: 80% of women who inherited wealth from their parents and 83% of widows experienced a “wealth transfer challenge.” UBS found that many widowed women did not have an established wealth transfer plan with their partner, and one in four said they did not know where all their partner’s wealth was before their passing. This lack of preparedness is alarming, but it presents an opportunity for your firm to step up and help your clients, ultimately building long-term relationships. “Advisors can offer a lot of value by helping their clients create an estate plan and navigate conversations with family members. By being a trusted partner in the process, advisors can build stronger relationships not only with current clients but also with the next generation.” – Alison Considine, Director of Betterment Advisor Solutions The opportunity: Become a family’s long-term guide According to the RBC Wealth Management–U.S. survey, the primary driver of feeling unprepared for an inheritance is not tax complexity or investment strategy—it’s a breakdown in or lack of communication. The UBS research found the same issue, with nearly one-third of women who inherited assets from their parents having no prior conversations with them about the wealth transfer. Over the coming years, communication is likely going to be the #1 skill advisors need to help clients manage a wealth transfer. If advisors want to keep financial planning relationships intact across generations, they need to get ahead of and lead these conversations. Here are three guidelines for successful wealth transfer conversations: Educate clients early. Help them understand how to transfer wealth tax-efficiently, preserve family assets, and make sure their wishes are clearly documented. Proactive education builds confidence and prevents costly surprises down the line. Bring the next generation to the table. Sit down with clients and their children or heirs to discuss goals, responsibilities, and expectations to help avoid misunderstandings down the road. Reframe the discussion. Wealth transfer isn’t just a financial transaction—it’s a personal story about family legacy, passions, and future impact. Use open-ended questions to surface values like philanthropy, entrepreneurship, or family tradition—and make those priorities central to the planning process. 10 questions to ask clients and their heirs to help facilitate a smooth wealth transfer Use the following questions as a starting point to begin intergenerational discussions around wealth transfers. As an advisor, you know your clients best, so tailor your conversations to their personal situations. For clients (Wealth givers—often Baby Boomers or Gen X): Have you clearly communicated your intentions for your wealth with your children or heirs? (Start by opening the door to alignment and transparency around values and expectations.) What values or legacy do you hope your wealth will help preserve or promote? (Encourage your client to think beyond dollars and towards impact.) Have you established or updated your estate plan, including wills, trusts, and beneficiary designations? (Identify potential gaps and ensure documents match current intentions.) Would you consider giving a gift to heirs or causes during your lifetime to see the impact of your wealth now? (Spark discussion about strategic giving and potential tax benefits.) Have you talked to your heirs about the responsibilities that come with inheriting wealth? (Emphasize financial literacy and preparedness of the next generation, which can lead to more intergenerational communication.) For heirs (often Gen X or Millennials): Do you understand your parents' or benefactors’ financial values and intentions for passing on their wealth? (Encourage open dialogue and reduce surprises or misunderstandings.) Do you feel prepared to manage or invest inherited assets? If not, what guidance do you need? (Help identify financial education needs or planning opportunities.) Do you have your own estate plan in place to manage future wealth transfers? (Promote proactive planning to help protect assets and preserve family goals.) Do you want to be involved in your own charitable giving or collaborative family philanthropy efforts? (Engages heirs in legacy planning and shared purpose with their parents.) What are your personal financial goals, and how might an inheritance affect those plans? (Show that you are thinking about the heir's personal needs as well.) How Betterment Advisor Solutions can help navigate the Great Wealth Transfer Betterment Advisor Solutions equips advisors with technology and tools that make it easier to communicate and collaborate across generations: Tax-smart technology: Leverage automated tax-loss harvesting, customizable drift-based rebalancing, automated asset location, and more to help clients manage taxes. Streamlined client portal: Offer your clients a white-labeled client portal, where they can easily see their full financial picture, with your branding on their statements and tax forms. Goals-based framework: Create customized goal names to create a personal feel for each client’s cash, investments, or held-away accounts.

Trade, conflict, and the case for staying invested in 2025 Jul 3, 2025 9:00:00 AM Turbulence and opportunity: Market insights for the second half of 2025. In his 1949 classic The Intelligent Investor, Benjamin Graham came up with a clever way to explain the ups and downs of the market: Mr. Market—a moody business partner whose emotions swing between optimism and fear. Some days, he offers a fair, rational view of your investments. Other days, his anxiety or excitement gets the best of him. Now that we’re halfway through 2025, with a world buffeted by tariff announcements and geopolitical crises, let’s pause to consider what Mr. Market has had to tell us about the meaning and impacts of these events so far. Do tariffs still matter? Back in April, when we shared our Q1 recap, trade tensions had stirred up volatility in investor portfolios. Since then stocks around the world have staged a comeback, with large U.S. stocks climbing into positive return territory year-to-date, and their international peers maintaining strong relative performance. Mr. Market appears to believe that the economic impact of tariffs will be limited. There may be good reason for that, as the Trump administration has walked back its most extreme threats, and the U.S.-U.K. framework for negotiating trade— featuring a 10% baseline tariff and tariff-free quotas on certain goods in areas like autos, steel, and aluminum— is being viewed as a template for other major trade partners. That said, Mr. Market may be getting ahead of himself. The full effects of tariffs on inflation are still unfolding. A rise in inflation could push policymakers to keep rates higher for longer, slowing economic growth and weighing on markets by raising borrowing costs. Still, a recession has yet to surface in the data, and risks remain well balanced for diversified investors. What does Middle East tension mean for investors? Recent airstrikes involving Israel, the U.S., and Iran have drawn global attention; however, world markets remained relatively steady. Over the past month, the S&P 500 has edged toward all-time-highs, suggesting investors don’t expect further escalation. Market participants appear confident that the fighting will be somewhat contained, and news of a ceasefire has further eased fears about economic disruption. Stock and bond markets have largely shrugged off the conflict, but oil prices are more reactive to instability in the Middle East. The region is home to many key exporters, as well as the Strait of Hormuz, a major global shipping route. Oil prices spiked in early June as Israel-Iran tensions intensified, but have since dropped sharply, reflecting both Iran’s limited ability to respond and the announcement of a ceasefire. A look ahead... The lesson Mr. Market keeps offering is that patient, broad-based investing beats reactive guesswork. Genuine hazards remain: Trade frictions could flare again, geopolitical surprises lurk, and any stumble in corporate earnings would challenge current market index levels. Yet with inflation decelerating and the Federal Reserve signaling it may trim rates before year-end, there’s a growing case for further upside in portfolios. Staying invested, diversified, and focused on long-term goals ensures Mr. Market’s mood swings are a source of opportunity, rather than regret, for disciplined investors. And our investing team is here to keep you up-to-date on macro-trends and market insights as they evolve.

The convergence of wealth & retirement: A $40 trillion market for advisors Jul 2, 2025 9:00:00 AM See how integrating wealth management and retirement planning can help your firm tap into a $40 trillion market opportunity. If you’re looking to grow your wealth management firm’s client base, serving retirement plan participants might just be the key to unlocking greater growth potential. The opportunity by the numbers: According to the most recent Betterment Retirement Readiness Report, 79% of employees say their employer offers a 401(k) plan. Valued at $40 trillion, retirement assets are 32% of all U.S. household financial assets, according to the ICI. The National Association of Plan Advisors reported that 74% of 401(k) participants would welcome professional help managing their accounts. The opportunity is clear for growth-minded advisors: A multi-trillion-dollar market of consumers is actively seeking professional financial guidance. In this article, we explore this growth opportunity along with how to overcome the challenges that come with it. Key benefits for advisors: Integrating wealth management and retirement planning The convergence of wealth management and retirement planning offers two benefits. Benefit 1: Use retirement planning as a growth engine for your firm Many plan participants are eager to work with financial advisors. According to a 2024 study by American Century Investments, over half use a financial advisor, and among those who don’t, 39% plan to do so in the future. At Betterment, we found in our Retirement Readiness Report that 21% would consider switching jobs to one that offers access to a live financial advisor. Engaging with retirement plan participants can be a powerful way for advisors to expand their client base. A 2024 Capital Group study found that high-growth wealth managers were: More likely to have 25% or more of their AUM in defined contribution plans 23% more likely to have a strategy for transitioning plan participants into prospects for their practice. Additionally, the study found that advisors can uncover a $1 million prospect for every 10 meetings they have with participants in medium to large plans. If you’re not already serving retirement plans, restructuring your firm to do so can be a gateway to growth. Plan participants have complex financial lives, and many will welcome advice on how to manage their overall wealth. Benefit 2: Manage clients’ full financial picture On the wealth management side of your business, clients look for holistic advice. Their retirement nest egg is part of their wealth, after all. Your current wealth management clients likely have sizable assets in their retirement plans and could benefit from your advice on portfolio allocation and management. Whether they’re switching jobs, starting a business, or reallocating funds, you can help them make informed decisions across their entire financial life. Vanguard’s “How America Saves 2025” report found that average plan participant account balances increased by 10% in 2024, reaching an all-time high of $148,153. CNBC reported that about two-thirds of rollover investors hold cash unintentionally because the funds are initially placed in a cash account. You have the opportunity to position your firm as a one-stop resource for financial wellness, retaining clients by helping them manage their entire financial life. How to overcome the challenges of managing wealth and retirement clients Serving wealth and retirement plans usually requires restructuring your firm. Below are three potential obstacles and how our team at Betterment can help you overcome them. Challenge 1: Provide holistic financial planning at scale The challenge: Serving multiple retirement plans simultaneously, each with dozens or even hundreds of participants, can make retirement planning at scale overwhelming for your firm without the right platform. How Betterment helps: Receive dedicated support from day one to streamline plan management—so you can focus on growing your business. A Senior 401(k) Onboarding Associate will be your dedicated point of contact to help you onboard new clients and offer ongoing support. You’ll also be assigned a 401(k) Client Success Manager, who will be your go-to contact for any questions, along with helping you set goals, manage plan changes, navigate Form 5500 filings, and create tailored education for plan participants. Challenge 2: Staying on top of regulatory compliance The challenge: Staying compliant takes work—and plenty of time. You’ll not only need to stay on top of legislative and regulatory changes related to retirement plans, but also your firm’s compliance and legal policies. How Betterment helps: We are your 3(16) administrator, handling compliance testing, taking on time-intensive work, and preparing audit packages and 5500s. We have a team of compliance experts with ASPPA, NAPA, and IRS designations, plus 50+ years of combined compliance experience. Challenge 3: Managing technologies to serve retirement plans The challenge: Serving retirement plans will require your firm to adopt new technologies to automate planning, compliance, and communications at scale. Trying to piece a tech stack together by yourself can take your valuable time away from serving clients. How Betterment helps: Our all-in-one dashboard helps you track plan metrics, generate custom reports, and get participant-level data with just a few clicks. Use our tools and technology to easily convert participants to new clients, building relationships to offer holistic financial planning to meet their evolving needs. Plus, for self-employed clients, we offer a streamlined, all-digital solo 401(k). And our mobile app lets your clients see their full financial picture on the go, branded with your firm’s logo, reinforcing your value between meetings. Grow your firm with a 401(k) solution built for advisors An easy-to-use platform with customizable investment options and white glove support for you and your clients. Flexible, customizable plan design and investment options Dedicated advisor and client support for administrative needs An all-in-one platform to service clients across retirement and wealth