The best robo-advisors of February 2022 – Forbes Advisor

Betterment is one of the pioneers of the robo-advisor approach to investing. After more than a decade in business, we believe that no other platform offers as much value to its customers as Betterment.

The improvement scored high in all categories. The Betterment Digital basic service tier charges a competitive annual fee equal to 0.25% of your balance, and there is no minimum balance requirement. Savers with higher balances looking for more advanced services can take advantage of Betterment Premium, which provides access to live financial advisors.

Create an account, choose your goals and enter a few personal details, and Betterment places you in a risk-appropriate exchange-traded fund (ETF) portfolio. Note that your portfolio will include around ten ETFs, some of which may charge high fees. This is not an optimal approach, in our opinion, because you can get all the diversification you need with just three or four ETFs at very low cost.

A note for those who choose the emergency fund option: you could find yourself in a portfolio (composed of 15% stocks and 85% bonds) a little too risky for your blood. If you need cash after a layoff in the wake of an economic downturn, chances are you’re selling low.

Betterment also offers alternative portfolios, including one focused on environmental, social and governance (ESG) factors. The platform offers automatic tax loss harvesting as well as a tax-coordinated portfolio option that structures your stock and bond allocation to optimize your tax treatment.

In addition to a standard taxable account option, long-term savers should check out Betterment’s retirement accounts, including a traditional Individual Retirement Account (IRA) choice, a Roth IRA, and a SEP IRA option for homeowners. small businesses.

Once you have $100,000 in your account, you will qualify for the Betterment Premium service level, which includes unlimited consultations with Betterment financial planning professionals and a higher annual fee of 0.40%. If you prefer the lower 0.25% fee, you can choose to stay on the Betterment Digital service level with balances over $100,000.

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