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The 12 Benefits of Betterment

From an all-inclusive low-cost portfolio to automatic rebalancing and dividend re-investing, Betterment offers a more efficient way to invest.

Articles by Betterment Editors

By the Editorial Staff
Betterment Resource Center  |  Published: December 11, 2013

Get peace of mind knowing your investments are in an optimized portfolio of low-cost stock and bond ETFs.

Automatic rebalancing and dividend re-investing save you time, enhance your performance and minimize your taxes.

Whether you’re looking for the most efficient way to roll over an IRA, or just build wealth, Betterment saves you time and money — and gives you peace of mind — when it comes to investing. We deliver better value compared to other investing services. See for yourself.

The 12 Benefits of Betterment

1. Five-Minute Setup: Set up an account in minutes. There are no funds to pick, or complicated decisions to make. Our all-inclusive portfolio is suitable for every investor with up to $10 million.

2. Betterment Portfolio: Your money is in an optimized diversified portfolio of low-cost stock and bond ETFs that balance risk and reward. The portfolio also has a slight small-cap and value tilt, which has tended to beat the market in the long term.

3. Low Cost, No Hassle: There are no minimums to open an account, and no costs to close one.  We have some of the lowest management costs in the industry, charging between 0.34% and 0.54% based on your balance and auto-deposit settings, including fund expenses.¹ Our automated portfolio management also saves you time—another savings of up to $2,500.

4. Outcome-Based Advice: Build wealth and manage risk based on your time horizon and  initial investment. Our software provides customized asset allocation advice and suggested contributions to get you to your investment goal. You can easily adjust your allocation with a simple slider.

5. Betterment Goals: Divide your funds into multiple investment goals each with its own allocation.View them all in one account with one simple dashboard.

6. Cruise Control: Never worry about rebalancing your account. When cash flows into your account, whether a deposit or dividend, our algorithms do a quick—and smart—rebalance (if needed) to keep your asset allocation perfectly set.

We offer superb live customer service seven days a week. Investment experts are available with one phone call.

7. Smart Dividend Re-investment: Every time your dividends arrive, we don’t just re-invest them blindly or wait until there is enough to buy a full share. Instead our algorithms re-invest every penny where you need to shore up imbalances to make sure you’re on track with your investments.

8. Betterment Tax Inoculation: We minimize your short-term capital gains exposure with our automated system of rebalancing and dividend re-investing. We also plug seamlessly into TurboTax for easy filing.

9. Hands-off Savings: Set up automatic transfers from your checking account on a schedule, so you don’t even have to think about investing money on a regular basis. Behavioral research has shown this is one of the best ways to increase savings.

10. Betterment Maximization: Our trading system can swap fractional shares—as small as 1/1,000,000 of a share—which means you never have money sitting on the sidelines and maximize every dollar you have invested.

11. Betterment Access: We have no minimums for withdrawals or deposits and our transaction times are as fast as they get in the industry. That means your money is in the market as long as possible—and ensures rapid liquidity when you need your funds.

12. ‘Apple of Finance’: What the iPod did for music, we’re doing for investing. Our smart, visual interface and apps for iPhone and Android let you easily manage your investment account from anywhere—and make it delightful to use. To boot, we are paperless to save you from statement overload. All your key information is stored in your account—accessible through one dashboard. You can always download a PDF if you want a backup.

¹Betterment’s calculations using a $100,000 portfolio; mutual fund assumes average expense ratio of 1.4% (ICIFFactBook, 2012); typical advised ETF assumes a 10-fund portfolio with four rebalances per year, trading costs of $8.50 trade (average of Etrade, Scottrade, Schwab, Fidelity), 0.44% average ETF expenses (Morningstar Investment Research) and 1% annual average advisory fee (PriceMetrix). Betterment costs include annual advisory fee 0.15% plus current average portfolio expenses of 0.19%.

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