Set goals, invest your money and take control of your financial future.
An FKD Feature exclusive

If you’ve heard anything about robo-advisors before, you’ve likely heard of Betterment.

They’re one of the biggest robo-advisors out there, and for good reason: They’ve got all the tools you need to get your money working for you, instead of the other way around.

Betterment betters your investments

Betterment builds you an investment portfolio based on a low-cost, diversified investing approach.

Without getting into too much jargon, that means:

1) You’re spending less of your hard-earned cash on investment fees

2) You aren’t about to lose all of your money if SBUX drops 80% because people stopped drinking pumpkin-flavored fall beverages. (Hey, it could happen, and if your whole portfolio was in that one stock? Bad news bears.)

They’ve built their portfolio options with the advice of bona-fide, Ph.D-holding experts who know how to grow investments by minimizing fees. They also make it easy to choose a portfolio mix that fits your goals.

It all starts with goals

As soon as you hit Betterment’s website, they’re asking you about goals faster than your college career counsellor, but in a good way. That’s because there isn’t one single perfect investment portfolio: there’s only the perfect portfolio for you.

To figure out what that looks like, Betterment needs to know what your goals are, so they help you choose between Safety Net, Retirement and General Investing goals.

"if you don’t have a Safety Net or an emergency fund, that’s your goal, trust me"

Depending on what your goal is – and if you don’t have a Safety Net or an emergency fund, that’s your goal, trust me – Betterment will recommend a portfolio built to deliver the right amount of risk for you.

For Safety Net goals, that means a lower amount of risk, and a different type of investments. These are to make sure that you don’t have to withdraw your money after losing a big chunk in a market downturn. Less risk means you’re less exposed to market fluctuations.

On the other hand, if you’re saving for retirement already like a boss, then you can take on more risk, because you won’t need the money for a long time. Your investments will have time to chill out and ride the market waves, and that higher risk will net you higher returns on your money over the long term.

See? Just like your career counsellor said, goals matter.

Look at your whole financial picture

Now, Betterment is reasonable, you guys. They don’t expect you to throw all your money into investments with them right away, but you can connect your other accounts to get the full picture of your current money situation.

That way, not only can you keep tabs on your money in a single place, you can also compare the different fees you’re paying (and finally figure out how much your bank is really charging you for that mutual fund… Yikes).

This robot seems oddly human…

If the idea of not speaking to a real live human being about your investments stresses you out, don’t worry.

Even though Betterment is called a robo-advisor, they’ve got real people on call literally 24/7 who are all set to answer your questions and help you figure this all out.

Want a reassuring pep talk that yes, you are on track to meet your goals? They’ve got your back.

Let’s talk money

While Betterment isn’t free, if you look at it compared to other personalized investing options, it’s pretty freaking close. For people who are just starting out, Betterment charges 0.35% to manage portfolios under $10,000 – as long as you contribute at least $100 to your account every month in a recurring payment.

If you don’t, it’s $3 a month, which for small account balances is actually a much higher rate. Just think of it as one more incentive not to cancel that recurring payment to fund a night out on the town. Don’t lie, we have all been there.

Once your portfolio gets bigger, crossing the $10,000 mark, your fees drop to 0.25%. If you’re really rocking it and you hit $100,000, you’ll drop down to 0.15%. Considering a financial advisor would charge you 1% or more, and banks usually top even that with their mutual fund fees, I’d say that’s a pretty sweet deal.

So what are you waiting for to get Better?

 

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Header image: Shutterstock

*This piece is meant only to expand awareness of available financial tools and products and should not be considered an official endorsement of the product or its outcomes by GenFKD.

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Posted 09.26.2016 - 02:36 pm EDT