Other Disclosures

SIPC Account Protection

Betterment Securities, member of SIPC, which protects securities customers of its members up to $500,000 (including $250,000 for claims for cash). Explanatory brochure available upon request or at www.sipc.org.

Investor Education and Protection

An investor brochure about Betterment Securities is available on FINRA BrokerCheck at brokercheck.finra.org. You can also call the BrokerCheck hotline at (800) 289-9999 or access the broader FINRA website at www.finra.org.

Disclosure of Transactions for Betterment’s Account

Betterment regularly trades for its own account in the same securities as we advise our clients on. Betterment’s securities positions are typically small. Our trading activity is necessary to round out transactions to the exact amounts Clients want to deposit, withdraw, or allocate. Betterment’s trading is conducted with other market participants, and we do not buy or sell with Betterment clients, although orders for our principal account are generally aggregated with our clients’ orders. The prices Betterment LLC receives for our trades are exactly the same as the prices every other client receives.

Disclosure of Order Execution and Routing Practices (SEC Rule 605, 606 and 607)

Betterment Securities exclusively routes orders in Rule 606 reportable securities on a non-directed basis to Apex Clearing Corporation (“Apex”). Apex may not be the ultimate execution venue for such orders, and Apex may further route these orders to other execution venues, based on Apex’s own routing determinations. Betterment Securities does not have any input into Apex’s selection of execution venues.

Apex may receive remuneration from executing venues through maker-taker pricing or other applicable execution venue fees or rebates and shares a portion of such remuneration with Betterment Securities.

Betterment Securities does not select the execution venues to which Apex routes Rule 606 reportable securities for execution. As a result, Apex is better positioned to prepare a quarterly report that reflects any execution venue specific maker-taker arrangements or other execution venue fees or rebates. Please click here to view the most recent quarterly report for Apex.

Important information about how Apex’s report relates to Betterment Securities’ orders. Apex’s Rule 606 report aggregates order flow from all broker-dealers that route to it. The characteristics of Betterment Securities’ orders differ in several key respects from Apex’s aggregate order flow, and customers should keep the following information in mind when reviewing that report:

  • Order types: Betterment Securities routes customer equity orders to Apex primarily as marketable limit orders. Accordingly, the portions of Apex’s report most representative of Betterment customers' orders are the S&P 500 and Non-S&P 500 stock sections, and within those sections, the marketable limit order columns. Because the report covers all of Apex’s order flow, the routing venue percentages shown may differ from those applicable to Betterment customers' orders specifically.
  • Trading sessions and venues: The venue routing percentages in Apex’s report, including for marketable limit orders, may differ substantially from the routing distributions of Betterment Securities’ orders. Apex’s routing percentages may differ from Betterment Securities’ order routing distribution for a number of reasons, including, but not limited to, that Betterment Securities does not transmit orders for execution outside of regular market hours. Apex’s report includes order flow routed to venues that operate exclusively during extended-hours and overnight trading sessions, and Betterment Securities’ orders are not routed to these venues.
  • Order size: Because Betterment Securities typically aggregates customer orders, the size distribution of Betterment Securities’ orders may differ from the size distribution of all orders reflected in Apex’s report.
  • Execution quality: Information in Apex’s report regarding execution quality reflects Apex’s aggregate order flow and may not be representative of the execution quality for Betterment Securities’ orders.

Customers can submit a written request to support@betterment.com for the source and amount of any compensation received by Betterment Securities in connection with a transaction in their account, or to obtain, under Rule 606(b)(1), the identity of the venues to which their orders were routed for execution during the prior six months.

For more information on Rule 605, and to see Betterment Securities' Reports, click here.

Business Continuity Statements

SEC and FINRA Rules require investment advisers and broker-dealers to create and maintain a business continuity plan.

In accordance with these rules Betterment LLC and Betterment Securities have both developed a plan that is intended to permit us to continue critical business operations during natural disasters, power outages, or other significant events. While there can be no assurance that service will continue without interruption in all circumstances, the plans do address actions that the firms intend to take in the event that there is a significant disruption. Account access is planned to be restored as the first step, which would be followed by other critical business operations. If there is a local disruption to the operating facilities of either firm, the respective business continuity plans call for the affected firm to establish operations at an alternate location. We maintain data backup records, located well away from our primary facility so that they would not be affected by a regional disruption. We intend for account access to be available through these records should the primary data center suffer a disruption. Our plan will be reviewed, updated, and tested periodically.

Statement of Financial Condition

The most recent Statement of Financial Condition for Betterment Securities is available for download.

Form 8937

Form 8937 is available for download.