Did it take a law for your money manager to do the right thing?

The Financial Industry Moves Forward, Kicking and Screaming

It's finally happened: Financial institutions will now be forced to put their customers' interests ahead of their own profits, thanks to a new rule from the Department of Labor (DOL).

We wanted this. We fought for this. Now, money managers have to put their customers' best interests first—just like Betterment has been doing since we launched in 2010.

This is, unarguably, a step in the right direction. But it makes you wonder—why did those money managers have to be forced to do the right thing? What were they doing before?

Questioning Your Money Manager: A Quick Guide

If this whole thing makes you wonder what your money manager has been up to, it might be time to ask them some questions. Here's how we would answer.

  • Question
    How we would answer
  • What services are you providing to me?

    Financial advice
    Account types, risk level, amount to invest, funds, personalized allocation

    Daily tax optimization
    Tax loss harvesting, asset location, tax-optimized lot selection

    Dividend reinvestment
    Daily rebalancing
    Fractional shares

  • Who makes money from my account—and how much?

    We make money from the fee you pay us, and that's it. The fee varies depending on the plan you choose. See more about our pricing.

  • Do you make more money recommending some investments over others?

    No. We don't have any of our own funds, and we don't get paid to recommend any funds to you.

  • Are you committed to acting in my best interests for all my accounts?

    Yes. The DOL only requires us to act in your best interest for your retirement accounts, but we act in your best interest for all accounts.

DOL Rule FAQs: What You Need to Know

Betterment is a new kind of investment service

We're transforming the investment industry. We're taking sophisticated investment strategies that have worked for decades, and using cutting-edge technology to make them more accessible to you and more aligned with your best interests. We don't get paid to recommend any funds and there are no hidden fees. We only choose investments and make recommendations that we determine are best for you and your goals.

We make recommendations from how much money to invest to the type of account that’s right for you. Then, we do it for you. We invest your money in a portfolio we've built for you, and manage it over time so that you don't have to.

Wondering if you can trust your money manager?
It’s time to try Betterment.

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Investing in securities involves risks, and there is always the potential of losing money when you invest in securities. Before investing, consider your investment objectives and Betterment's charges and expenses.

References in print advertisement to $148 million in deferred income are based on an estimate, as of 11/30/16, of the gross amount of tax losses realized for customers by Betterment's automated tax loss harvesting service since the launch of that feature in June 2014. Tax losses realized in taxable accounts can be applied to offset capital gains or ordinary income, thereby deferring tax until the investments are eventually sold. Tax deferral is expected to lower an investor's overall tax burden because the amount that would otherwise be owed can be reinvested and compounded over the course of the deferral period. This is not tax advice. For more information on Betterment's tax loss harvesting service, and full dislosures, please see: https://www.betterment.com/resources/research/tax-loss-harvesting-white-paper/

References in print advertisement to 75 million retirement savers are based on https://www.whitehouse.gov/sites/default/files/docs/cea_coi_report_final.pdf

1 http://www.investmentnews.com/article/20161006/FREE/161009942/merrill-lynch-eliminates-commission-ira-business-in-response-to-dol
2 http://www.investmentnews.com/article/20161110/FREE/161119998/jpmorgan-chase-will-stop-charging-commissions-on-iras-due-to-dol
3 http://www.investmentnews.com/article/20161026/FREE/161029923/morgan-stanley-to-keep-commission-based-ira-business-despite-dol
4 http://www.wsj.com/articles/wells-fargo-to-keep-commissions-based-retirement-accounts-under-fiduciary-rule-1480615211
5 http://www.investmentnews.com/article/20161026/FREE/161029927/ameriprise-will-stick-with-ira-commissions-under-dol-fiduciary-rule