Betterment has plenty going for it, including access to fractional shares, automated portfolio rebalancing and diversification across 10 asset classes. But depending on your investment goals, the grass may be greener with one of these five Betterment alternatives.
More automated investing features than Betterment.
This platform's flat-rate robo-advisor rounds up debit purchases to invest the difference on your behalf. Acorns sets itself apart from Betterment — and many other robo-advisors — with a round-up feature and flat-rate pricing. Most automated investment platforms charge a percentage-based management fee, but Acorns opts for flat-rate monthly pricing that's at its most competitive for portfolios of $5,000 or more. To use this platform's robo-advisor, you must link a debit card to your account. Acorns then rounds up any purchases you make and invests the difference.
Greater control over your portfolio than Betterment.
M1 Finance is ideal for investors seeking more autonomy over their investments. The platform essentially acts as a happy medium between fully automated investing and self-directed trades. M1 Finance invites investors to pick out their own investment slices that it later combines into investment “pies.” Your investment pie is your portfolio, which M1 then monitors and rebalances on your behalf. The service is free to use and various accounts are available, including traditional and Roth IRAs. But it lacks Betterment’s tax-loss harvesting feature, and new investors may not feel comfortable picking their own investments.
M1 Finance, LLC does not charge commission, trading, or management fees for self-directed brokerage accounts. You may still be charged other fees such as M1’s platform fee, regulatory fees, account closure fees, or ADR fees. For a complete list of fees M1 may charge visit M1 Fee Schedule. M1 is not a bank. M1 Spend is a wholly-owned operating subsidiary of M1 Holdings Inc.. M1 High –Yield Savings Accounts are furnished by B2 Bank, NA, Member FDIC. Obtaining stated APY (annual percentage yield) with the M1 High-Yield Savings Account does not require a minimum account balance. Stated APY is accrued on account balance. APY is solely determined by M1 Spend LLC and its partner banks, and will include account fees that will reduce earnings. Rates are subject to change without notice. M1 High-Yield Savings Account is a separate offering from, and not linked to, the M1 High-Yield Cash Account offered by M1 Finance, LLC. M1 is not a bank.
Better for families saving for their children's education than Betterment.
With similar management fees and asset classes, Wealthfront's major edge over Betterment is its college savings account. Wealthfront has plenty in common with Betterment, including a 0.25% annual management fee, a spread of over 10 asset classes and tax-loss harvesting options. In fact, the platforms share so much in common that there's really only one reason to opt for Wealthfront over Betterment: the ability to open a 529 college savings account. If you're interested in saving for higher education expenses, Wealthfront is your best bet. But be prepared for a $500 minimum deposit and lack of access to fractional shares.
Better than Betterment for access to financial planners.
While SoFi doesn't offer tax-loss harvesting, it distinguishes itself by providing access to certified financial planners — as many as you like for SoFi Plus members and one session for non-members. We also like SoFi for its automatic portfolio rebalancing and its robo-advisor service for a 0.25% annual fee. While SoFi hasn't been around quite as long as Betterment, its access to human advisors gives it a unique edge in the market.
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
Other fees, such as exchange fees, may apply. Please view our fee disclosure to view a full listing of fees.
Investing in alternative investments and/or strategies may not be suitable for all investors and involves unique risks, including the risk of loss. An investor should consider their individual circumstances and any investment information, such as a prospectus, prior to investing. Interval Funds are illiquid instruments, the ability to trade on your timeline may be restricted. Brokerage and Active investing products offered through SoFi Securities LLC, Member FINRA(www.finra.org) /SIPC(www.sipc.org).
There are limitations with fractional shares to consider before investing. During market hours fractional share orders are transmitted immediately in the order received. There may be system delays from receipt of your order until execution and market conditions may adversely impact execution prices. Outside of market hours orders are received on a not held basis and will be aggregated for each security then executed in the morning trade window of the next business day at market open. Share will be delivered at an average price received for executing the securities through a single batched order. Fractional shares may not be transferred to another firm. Fractional shares will be sold when a transfer or closure request is initiated. Please consider that selling securities is a taxable event.
Options involve risks, including substantial risk of loss and the possibility an investor may lose the entire investment Before trading options please review the Characteristics and Risks of Standardized Options
Advisory services are offered by SoFi Wealth LLC, an SEC-registered investment adviser.
Utilizing a margin loan is generally considered more appropriate for experienced investors as there are additional costs and risks associated. It is possible to lose more than your initial investment when using margin. Please see https://www.sofi.com/wealth/assets/documents/brokerage-margin-disclosure-statement.pdf for detailed disclosure information
Probability of Member receiving $1,000 is a probability of 0.028%
SoFi Plus members can schedule an unlimited number of appointments with a financial planner during periods in which the SoFi Plus member meets the eligibility criteria set forth in section 10(a) of the SoFi Plus Terms and Conditions. SoFi members who are not members of SoFi Plus can schedule one (1) appointment with a financial planner. The ability to schedule appointments is subject to financial planner availability. SoFi reserves the right to change or terminate this benefit at any time with or without notice. Advisory services are offered by SoFi Wealth LLC, an SEC-registered investment adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov.
Terms and conditions apply. Roll over a minimum of $20K to receive the 1% match offer. Matches on contributions are made up to the annual limits.
unlimited 1% match on recurring deposits to a SoFi InvestⓇ account, paid in rewards points. Must be a SoFi Plus member at the time a recurring deposit is received into your SoFi Active or Automated investing account to qualify. Bonus calculated on net monthly recurring deposits made via ACH and paid out as Rewards Points. See Rewards Terms of Service. SoFi reserves the right to change or terminate this promotion at any time without notice. See terms and limitations. https://www.sofi.com/sofiplus/invest/#disclaimers
Robo Advisor: Automated investing is offered through SoFi Wealth LLC, an SEC-registered investment adviser. 0.25% fee is based on your account value. The wrap program fee may cost more or less than purchasing brokerage, custodial, and record keeping services separately.
Blooom can help you grow your retirement savings, but its fixed annual fee pricing structure means it's only cost-effective for larger portfolios. Blooom offers automated investment portfolios designed for investors with employer-sponsored accounts, like 401(k)s and 401(a)s. Fees are assessed on an annual basis, and plans start at $45 per year. The fixed cost of entry means that for Blooom's service to be cheaper than Betterment's, you'll need a portfolio of at least $20,000. Still, for those seeking guidance with an employer-sponsored account, Blooom offers portfolio analysis, automatic portfolio rebalancing and — with the higher tiers of service — access to financial advisors.
Annual fee
$45 per year
Annual advisory fee
$45 per year
Pros and cons of Betterment
Consider the following benefits and drawbacks of investing with Betterment.
Pros
Tax-loss harvesting. Asset allocation is consistently monitored to minimize potential taxes.
Fractional shares. The availability of fractional shares ensures every penny in your portfolio is put to practical use.
Automated rebalancing. If your investments stray further than 3% off their target ratios, your portfolio is automatically adjusted.
Cons
No direct indexing. Betterment investors don’t have access to direct indexing opportunities.
Withdrawal delays. Some investors complain of account withdrawal delays.
How to transfer your brokerage account
Interested in switching brokers? The process will depend on the type of account you have and the platform you plan to move to. Betterment doesn’t charge any account transfer fees, and most brokers don’t charge anything for account setup. Here’s what to expect of the process.
Inform your new broker of the transfer and provide them with your Betterment account number.
Complete the transfer paperwork from your new broker. For accounts under $250,000, your signature must be notarized or medallion signature guaranteed. For accounts over $250,000, your signature must be medallion signature guaranteed.
Mail your transfer paperwork, including a copy of the first page of your most recent Betterment statement, to Betterment Transfers, PO Box 207691, Dallas TX 75320-769.
Full shares from individual accounts will be transferred directly to your new institution. For IRA to IRA transfers, Betterment will send a check to your new brokerage.
Compare robo-advisors today
Review your options by comparing minimum deposits, asset types and annual fees, or select the Go to site button to learn more about a particular service.
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Shannon Terrell is a lead writer and spokesperson at NerdWallet and a former editor at Finder, specializing in personal finance. Her writing and analysis on investing and banking has been featured in Bloomberg, Global News, Yahoo Finance, GoBankingRates and Black Enterprise. She holds a bachelor’s degree in communications and English literature from the University of Toronto Mississauga. See full bio
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