Betterment Assets Under Management (AUM)
Betterment provides a simple online investing solution for clients who want an easy way to invest without much effort. But how many customers do they have, and how much in assets under management? Here are the details:
| Betterment assets under management |
$50 billion |
| Betterment number of customers |
900,000 |
| Years in business |
14 |
Betterment is one of the largest robo-advisors in terms of assets under management.
However, it is extremely small when comparing total assets under management to
Charles Schwab, who has
$9.57 trillion in AUM and over 35.7 million customers.
Free Charles Schwab Account
Visit Schwab Website
What is Betterment.com?
Betterment.com offers investors - from novice to well-seasoned - the opportunity to make their money work for them in the current market with a minimal
amount of effort. Much of the direction a typical investor would pay to receive from a financial planner is managed automatically by Betterment’s software
at no extra charge. According to their statistics, a Betterment investment account would have done better than an average advised account in nearly every
time period over the last decade: 50% better in a portfolio with a 70% stock allocation from the last ten years. Let's explore what the firm offers customers
in our 2024 Betterment review.
What Betterment.com Offers?
Betterment is a smooth front-end for investing in Vanguard ETFs, which are widely considered by some as the easiest, most reliable entry into
investing in ETFs. There are currently 12 ETFs offered: 6 stock ETFs and 6 bond ETFs.
Betterment accounts can be set up as retirement (traditional and Roth IRAs) as well as non-retirement and trusts.
Within an individual account, Betterment investors can designate various goals and receive a suggested allocation of stocks and bonds based on the timeframe of
that goal. For example, a non-retirement investment account may have separate goals for a Safety Net, Wealth Building, Home Down Payment, or College Fund,
each with a different timeframe and thus a different investment strategy and allocation. For each goal, Betterment users can see projected returns for above-average,
normal, and below-average markets and make deposits accordingly.
Is Betterment Safe?
The New York City based Betterment is an SEC (Securities and Exchange Commission) registered investment advisor, and Betterment Securities is a broker-dealer
regulated by FINRA and the SEC. The securities in customer accounts are protected up to $500,000 by SIPC, with a limit of $250,000 for claims of uninvested cash balances.
While your Betterment account is as easy to use as an online savings account with a bank, there are a few main differences. Although most bank accounts are
guaranteed not to lose value, there is a possibility that your investment at Betterment could lose value depending on market conditions. At the same time, a Betterment
account has a possibility receive much higher returns than a savings account. The amount of risk you want to take is up to you, and
is controlled by setting your allocation between a higher-return Stock Market Portfolio and an ultra-safe Treasury Bond Portfolio.
If Betterment goes public or is acquired, you would maintain complete control of your brokerage account. All the underlying securities in your Betterment portfolio
are owned by you - you would be free to add or withdraw money at any time.
In the unlikely event that Betterment was to go bankrupt, your money would remain safe, and it would be moved to a different broker. Betterment's money is completely
separate from client's money, and the company is not allowed to use your money to pay for its expenses. You own all the ETFs in your Betterment portfolio,
and in the event of bankruptcy your money will be transferred back to your bank account.
Commissions, Fees, and Minimum Deposit
| Plan |
Minimum |
Annual Fee |
Included |
| Digital |
$0 |
0.25% |
- Automated portfolio management
- Tax efficient management features
- Advice across your investments
- Award winning customer support
|
| Plus |
$100,000 |
0.40% |
- All benefits of Digital plan
- Annual call with team of CFP professionals and licensed financial experts
- Additional account monitoring by a team of licensed financial experts
|
| Premium |
$100,000 |
0.50% |
- All benefits of Digital plan
- Unlimited call with team of CFP professionals and licensed financial experts
- Additional account monitoring by a team of licensed financial experts
|
Betterment charges a management fee which is a percentage of your balance. It is prorated across the
entire year and is charged at the end of each calendar quarter (every three months).
For accounts under $10,000 they provide 2 pricing options. For anyone who has automated deposits turned on for at least $100 per month,
the rate is just 0.35%. If one chooses not to automate their investing, the fee is still a low flat rate of just $3/month. This is either/or
and never combined. After your account reaches $10,000 there are no longer deposit requirements and you focus on reducing your fee down
to just 0.25% per year, and then further to 0.15% when your account is over $100,000.
There are no fees charged for trades or transactions, transfers, rebalancing, advice, account administration, etc. And there is no
minimum investment or account balance required.
Updated on 8/21/2024.
Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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