Betterment Review: Investing Made Simple

By Marko Zlatic
Last Updated: July 14, 2020
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At a time where The Federal Reserve continues to print money with no end in sight, cost of living continues to rise, and our economy continues to shift and shed hundreds of thousands of jobs, investing your hard-earned money has never been more important.

However, millions of American’s still do not actively participate in investing, specifically in the stock market.

In fact, the percentage of American’s that own stock has been on a consistent and gradual decline, peaking at 62% in 2006 and as of June 2020 stands at 55%.

In that same span of time, the Dow Jones Industrial Average ($DJIA) has more than DOUBLED in value.

That said, you cannot afford to skip out on investing in the stock market. Your family’s future depends on it.

Don’t know how? That’s where Betterment comes in.

What is Betterment?

Betterment is a Robo-Advisor, which is essentially an online financial advisor that operates based on algorithms and software.

As unorthodox as that may sound, Robo-Advisor’s are becoming more and more popular in today's pool of young investors.

As of 2019, market research firms like Backend Benchmarking and the Aite Group estimate that $350 billion to $440 billion is currently managed by Robo-Advisors. And while $350 billion to $440 billion is a lot of money, the Robo-Advisor market is projected to grow well into the trillions by 2024.

Betterment, founded in August 2008, was one of the first Robo-Advisor based firms that emerged from the 2008 financial crisis.

As of December 2019, Betterment proudly stands as the largest independent online financial advisor in the world.

Check out Betterment Now

So, what makes Betterment…Better?

Fantastic question! We’ll break it down and show you everything Betterment has to offer.

1. Betterment Picks Your Investments for you

Yes, you heard that right. Betterment picks your investments for you and even recommends asset allocation based on your personal appetite for risk and the stage you’re at in your investing journey.

Betterment focuses primarily on investing in ETF’s, or Exchange Traded Funds – which are essentially a basket of stocks (and bonds) that allow you to adequately diversify your portfolio rather than investing in single stocks where the risk of loss is much greater.

No more scrambling to invest in the hottest stock pick you got from your uncle at the family barbeque.

And no more taking hours out of your day to meet with a financial advisor to potentially be ignored because you may not have a net worth of more than 6-figures.

Betterment takes the hard work out of investing – by picking and choosing investments that will deliver consistent returns over the long run.

2. Betterment Accepts all Levels of Investors

Come one, come all! Betterment, although geared towards the beginner investor, works well for all investors – even those with moderate to high levels of investing experience.

On top of their hands-off approach to investing, Betterment offers retirement planning, rollovers, and savings/checking accounts.

Overall, if you want to have your finances all in one convenient location, Betterment is for you.

3. The Minimum Investment to Begin is $0

Yes.  You read that right. The nice thing about robo-advisors is that the cost of entry, or the cost of becoming a client, is very low.

4. Betterment’s Pricing is Straightforward

Betterment offers two plans:


  1. This plan costs .25%. For example, if you have $10,000 invested the annual fee is only $25.
  2. $0 minimum balance to start.


  1. This plan costs .40%. For example, if you have $10,000 invested the annual fee is only $40.
  2. Gives you access to a personal financial advisor (CFP).
  3. $100,000 minimum balance to start.

Bonus Features

But wait, there’s more!

Betterment also offers a retirement calculator where it asks you about your retirement needs and where you want to be. It then takes your responses and tells you what you need to do to reach your retirement goals.

Moreover, there are personalized advice packages via Betterment’s Certified Financial Planners.

So, if you’re planning for marriage, children, college, whatever it may be, you can receive advice from Betterment’s team of CFP’s.


Where Betterment Falls Short

As does any product or service on planet earth, Betterment also has its shortcomings.

For one, Betterment is not ideal for DIY (do it yourself) investors.

If you like to dig down deep into a company’s performance metrics, seek out individual stocks, and spend long hours analyzing investments, Betterment is most likely not for you. Betterment, after all, is focused on investing in funds – not individual stocks.

Secondly, if you’re someone with a higher net worth or who wants to get the full picture, Betterment does not asset allocate with 3rd parties. What I mean by that is that if you have a 401(k) with a 3rd party for example, and you link it with Betterment, it’ll show you what’s in your 401(k) but it will not asset allocate based on what’s already in your 401(k). In essence, the two platforms will not speak to each other.

Lastly, you cannot invest in REITs (Real Estate Investment Trusts) or Commodities (gold and silver for example) through Betterment. For those that want to diversify outside of stocks or funds, REITs and Commodities are obviously two ways to do so. Unfortunately, Betterment does not offer that at this time. 

Final Thoughts

Overall, my review of Betterment rated quite well on the Marko Scorecard notching a total score of 53.5 out of 60.

For those of you that haven’t seen the Marko Scorecard for platform reviews, here’s what it’s comprised of:

FeaturesBetterment Score
Commissions and Fees (Cost)09/10
Customer Service09/10
Ease of Use9.5/10
Tools and Resources8.5/10
Investment Options09/10
Asset Allocation8.5/10

In my humble opinion, and after diligently reviewing the Betterment platform, Betterment is the easiest way to begin your investing journey.

So… what’s the hold-up? Go after it.  Happy investing everyone!



My Trusted Investing Resources

M1 Finance
M1 Finance allows you to trade Stocks, Bonds, and ETFs 100% free of charge. Perfect for the hands-off investor who still wants to pick individual stocks.
Try M1 Finance
Passively invest in real estate with just $500. Fundrise allows you to easily create a portfolio of residential & commercial real estate holdings.
Try Fundrise
Investing Made Simple. Betterment is a great way to invest for anybody who doesn’t want to worry about picking stocks or mutual funds.
Try Betterment
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