REVIEW: Betterment Revisited


It's been nearly 2 years since FPMD's very first review post on  Most of the comments in my original review still stand true today.  However 2 years is a long time, especially so in the fintech industry.  While the core concept that defined Betterment, namely the emphasis on passive automated index investing, remain unchanged, Betterment has added some bells and whistles to their service offerings.  Let's review the changes.

Change in fee structure

Originally Betterment based the fees it charged on how much you have invested with the company:

  • Builder plan - 0.35% fee when you have $100/month minimum auto-deposit.
  • Better plan - 0.35% fee when you keep a $10,000 minimum balance.
  • Best plan - 0.15% fee when you keep a $100,000 minimum balance.

In January 2017 the company announced a major overhaul of the fee structure with a flat 0.25% fee for the traditional investment management product now termed "Betterment Digital".

Humans in the Robot Shop

While Betterment and other robo-advisors have enticed traditional investing powerhouses such as Charles Schwab and Vanguard to add Robo options to their own product offerings, Betterment has gone in the other direction and now offers investors a human option... for a price.  These products are termed "Betterment Plus" (0.4% fee) and "Betterment Premium" (0.5% fee) respectively.

More Accounts, More Options

While Betterment started out operations with traditional taxed investment accounts and IRAs (both Traditional and Roth), the company now offers an expanded list of investment products including:

Tax-Coordinated Portfolio

I've talked about other cool Betterment features such as the RetireGuide™ and Tax Loss Harvesting Plus (TLH+) before.  Tax-Coordinated Portfolio is a more recent addition to Betterment's financial arsenal.  Their YouTube video explains this way better than I can.

Final Thoughts

With traditional investing powerhouses like Vanguard, Fidelity and Charles Schwab now jumping in the ring, it's a safe bet that Robo-advisors are here to stay.  Of the newcomers, Betterment clearly has the lead, becoming the first Robo-advisor to hit $5 billion under management in the summer of 2016.  Personally, I've been a customer of Betterment since 2013 and I remain a happy customer today.  For more details, check out the original FPMD Betterment Review.  If you enjoyed this review and would like to open a Betterment account of your own, please consider supporting this site by doing so via the FPMD referral link.

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Future Proof, MD

Dr. Bo Liu is an aspiring radiologist-in-training and the founder and editor of the White Coat Money Blog.  He has an interest in interventional radiology and helping his medical colleagues get ahead in this mad world of medicine and money.  When he's not crushing the list at the PACS station or typing up your next favorite blog post, you can usually find him at the local badminton club, movie theater or the most recently opened restaurant.