Betterment is updating its Digital stocks and bonds investing account pricing plan on December 15, 2022.
What’s changing for investment accounts?
The base price for your combined stocks and bonds investing accounts will be $4 per month. For customers with multiple investing goals in their taxable legal accounts or IRAs, the $4 will be assessed proportionally to the goal balance.
You switch to an annual price of 0.25% (25 bps) of your balance by either:
- Setting up a recurring deposit(s) of $250/month or more
- The recurring deposit can be into any account, and it can be across multiple accounts as long as the monthly amount totals to $250
- Recurring deposits will be totaled across household accounts
- Having a total Betterment balance of $20,000 or more
- Based on your combined balance across any stocks and bonds investing accounts, crypto accounts, Cash Reserve, cash goals, and Checking accounts you hold at Betterment
- Your Betterment balance will be totaled across household accounts
Your pricing is calculated based on the daily balance of your combined accounts, including any balances held in stocks & bonds investing accounts, crypto accounts, Cash Reserve, cash goals, and Checking accounts, and accrued daily. For more information on switching fee plans, please visit this FAQ.
For any day that your account balance is $20,000 or more, you will be charged the 0.25% fee based on account balance for that day. For any day that your account balance is less than $20,000, you will be charged the portion of the $4 monthly fee for that day. For clients with account balances around $20,000, your monthly fee may be more than $4 per month if on certain days your account balance exceeded $20,000.
Below are some examples of how this pricing change may affect you:
If your Betterment balance is $10k, you now pay $48 per year vs. $25 per year.
If your Betterment balance is $15k, you now pay $48 per year vs. $37.50 per year.
What’s remaining the same?
The pricing change does not affect the following accounts:
- Premium Stock and Bond Investing
- Cash Reserve
- Cash goals
- Crypto accounts
- Optum HSAs invested through Betterment
Cash Reserve, Checking, and in-app financial planning products will still not have fees. Crypto investing will continue to cost 1.00% per year.
Betterment 401(k) and Optum HSA pricing and fees are not affected by the pricing change, however, if you have a Betterment IRA or a taxable stocks and bonds investment account in addition to these account types, please read the information below.
Notification for customers who have a Betterment 401(k) or Optum HSA managed by Betterment
The pricing change does not affect Betterment 401(k) and Optum HSA pricing and fees. If in addition to these account types, you also have a Betterment IRAor taxable stocks and bonds investing account, the 0.25%/year pricing structure will continue to apply to your household's IRA and taxable account(s) if:
- You are an active employee of a Betterment at Work 401(k) plan or,
- Your 401(k) account is funded
Optum HSA managed by Betterment:
- Your account is open
Otherwise, the $4/month base price will be applied across your Betterment IRA and/or taxable stocks and bonds investment account(s) that do not meet balance or recurring deposit requirements for the 0.25%/year pricing plan.
Please be aware, if you are no longer an active employee in a Betterment at Work 401(k) plan and you elect to roll over your funded Betterment 401(k) into a Betterment IRA, your Betterment IRA would be subject to Betterment’s $4 per month pricing unless your combined account balance (including any balances held in stocks & bonds investing accounts, crypto accounts, Cash Reserve, cash goals, and Checking accounts) exceeds $20,000 or you set up a qualifying monthly recurring deposit.
Joint accounts and households
You can household your accounts to combine your balances for the purposes of meeting the pricing balance requirements for our various pricing plans. To learn more about householding, please see this resource.
Where can I view my pricing plan?
If I’d like to set up a recurring deposit, how can I do so?
To set up a new recurring deposit, log in and navigate to your Transfers page. Via +Deposit to Betterment, you can select the sending and receiving accounts, deposit frequency, and amount. To modify an existing recurring deposit, visit the Pending Transfers page. You’ll be able to change the frequency and amount.
Pricing Change Document Updates
We’ve also completed an update of Betterment’s Form ADV and Form CRS disclosures, and client agreements, with a description of these pricing changes. We encourage you to review these updated documents.