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Any betterment users?

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Any betterment users?

I’m looking into options to put away monthly into an account that will be an emergency or safety net account that will also be invested since I don’t plan on touching it.

 

whats your set up? Did you save a lump sum then start it or start from nothing? I have a 401k, Roth IRA, and acouple of High yield savings accounts.

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Message 1 of 5
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Senior Contributor

Re: Any betterment users?


@BabyFaceNelson wrote:

I’m looking into options to put away monthly into an account that will be an emergency or safety net account that will also be invested since I don’t plan on touching it.

 

whats your set up? Did you save a lump sum then start it or start from nothing? I have a 401k, Roth IRA, and acouple of High yield savings accounts.


A Roth is a good option since you can always withdraw your contributions without penelty.   Just don't touch any gains..


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Message 2 of 5
Moderator Emeritus

Re: Any betterment users?

It's probably mostly fine but I haven't used the service personally and I gave up on Wealthfront and Fidelity Go but we've been in a weird market time and as such most of the more conservative strategies really have underperformed and nobody knows how the robo advisors will do if we do get a sustained downturn.




        
Message 3 of 5
Valued Member

Re: Any betterment users?

I researched Betterment, Wealthfront and a couple others, and ultimately ended up at Wealthfront.  With very low fees, and a minimum opening investment of only $500 it was a good fit for me.  I've actually been quite impressed, especially considering the flaky market we've had.  Impressed enought that I keep tossing a little more at it every payday.  It's invested (no trading fees) automatically based on the plan I setup when I opened the account, so very easy.  I've been so impressed I actually moved one of my Roth IRA accounts from Fidelity (they have my 401k and several other ivetement accounts) to Wealthfront.  So far I'm glad I did.  As revelate mentioned though, not really sure how the robo advisors will do during a significant, sustained downturn.  I'm sure we'll find out eventually Smiley Mad

 

<Mod edit:  Sorry, that can't be discussed here.  --UB>

Message 4 of 5
Established Contributor

Re: Any betterment users?

One gotcha: Make sure that whatever it is investing for you, you don't own anywhere else in some other account. If it's investing in certain funds, make sure you don't own the same/similar funds in some other account. If you do you will screw up their calculation of your taxes and they will make wrong decisions that cost you money ("wash sale rule"). 

 

For example, if they are moving you in and out of some S&P500 fund make sure you don't own S&P500 funds somewhere else, becuase from IRS point of view it'll all be one combined holding, but since betterment/wealthfront won't know you have this other holding, they will buy/sell it as though their own investment was your only position in that fund.

 

You can have other accounts with OTHER securities in them, and that's fine, so long as there's no overlap.

 

Also for the same reason dont' have BOTH wealathfront and betterment accounts, as they will totally screw each other up and create a tax filing fiasco.


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