I’ve Finally Started To Invest…Off To Betterment!

Betterment, an option I can stand by.
1 picture, 1 simple effect and 1 Betterment.com ad and, we’ve got a pretty cool pic!

Hey everyone, thanks for swinging by to hear my story about my decision to invest. I’m Josh, the guy behind this blog and, I really appreciate you stopping by! That being said, when it comes to things like investing, laws of what I can or can’t say may hinder the process of growth. The good news is, we have great disclaimers that protect us and allow us to speak our minds online. So, here’s a big one before we get into the meat and potatoes of this article, which reminds me…Hey Money and Potatoes, how’s it going?

Disclaimer #1 – Blatant Plug Disclaimer: Yes, I absolutely plugged Money and Potatoes in the end of the last paragraph and, this one is to do nothing more than plug them again. But, they did not pay me for this advertising, they just provide a fun personal blog that you may want to check out when you’re done reading this article.

Disclaimer #2 – This Is Not Advice: As you can probably tell from the last couple of paragraphs, I’m no big wig, suit and tie wearing kind of guy. If you’re looking for that you’re on the wrong blog. I write about how I invest, use credit cards and/or have helped others through the process but, every situation I talk about is very unique. Before following in my footsteps on anything, do your own research, understand you unique personal finance position and, then, and only then, take action to become more stable.

Now We Get To The Meat N Taters

So, I did my Monday Money post over at Modest Money as I do every week. But, this week was something very close to home. It was a post about my decision to use Betterment.com investment services but, if you read into the article, you easily could see that there was much more to it! To be short about it, I went over why investing by 25 is important and the fact that I’m about to turn 26. Read the article here!

One of the reasons I wrote that article is, I’m watching time fly by and, not doing anything with my money. Well, not anymore. I’ve been doing reviews for Jeremy lately and, we’ve been looking at different investment services. I’ve checked out a lot of different sources and I’ve gotta say, my favorite investment service by far, at least to read about has been Betterment. But, I’ve never used Betterment and, before the review, I’d never even heard of them.

A Quest For More Betterment Personal Stories

So, I wrote this detailed article about them in a place that I knew would get a lot of comments from authorities in the personal finance industry. Not to my surprise at all, I got a bunch of comments from people who really know the investment market, the personal finance market, ect…

I’ve Gotta Share Some Of These Comments

Grayson from Debt Roundup writes

I have been with Betterment for close to a year. I really have enjoyed their service and plan on keeping it for some time. It is super easy to use and it really is a time saver. They are also creating a better portfolio next month, so it should offer a greater diversity.

Kim from Eyes On The Dollar writes..

I started a Betterment account about 6 months ago. I realize I could probably invest the money myself, but I don’t have to think about it, so that’s worth something.

Rita P. from Digital Spikes writes

Josh, it is very good that you thinking long term right at 25. Betterment is very good option for people who don’t have time to invest. Invest your money, set your bucket and just relax. Nice post.

There Was One Thing I Didn’t Notice In Comments

It seems like absolutely no one had anything bad to say about the option. There were a couple of comments that mentioned other investment services they used but, in the same comment, mentioned that Betterment is perfect for the right investor. If the top guys in the industry have nothing bad to say about Betterment, well, I’ve got a lot to think about!

Thinking Done…Off To Betterment.com

Right after responding to all the comments on my post, I grabbed by checking account information and started an account of my very own. And, since I’ve been through it, I figured since I went through the sign up process, I should answer a few common questions here for you…

Question #1 – Is Betterment actually free?

Answer – Well, yes and no. If you’re going to use it to see what your goals should be and where you should put your money, it is absolutely free. You don’t have to make a deposit to sign up. However, to use the tools, you are going to need to enter your checking information…just in case you do decide to invest.

Now, if you decide to invest, it’s not free. Betterment has an annual fee that fluctuates depending on your balance. The annual fees range from .15% to .35% with an additional .2% account management fee. But, in my opinion the tools are well worth the fee. That’s especially true when you consider that there are no trade fees at all. You do not pay on a per transaction basis, you pay an an annual basis and, that’s it!

Question #2 – Will Betterment.com ask for my social security number?

AnswerYes they will. When it comes to any form of investment, there are tax implications or rewards that may come as a result of that investment. For more information on taxes as they relate to investments, consult your accountant or financial advisor as well as tax calculators and estimators.

Question #3 – How long did it take to sign up?

Answer – Don’t you hate it when you read something like sign up in 3 minutes and you still happen to be trying to get it done 2 hours later? I never get that far and avoid aggravation. Anyway, the process was pretty simple. I’d say it took 6 or 7 minutes to sign up.

Question #4 – Do you really get the $25 they promise just for signing up?

AnswerYup. But, there is one condition. You have to start with an initial deposit of $250. But, if you do, it works out to be a 10% initial R.O.I., not too shabby if you ask me!

Important Update 8/28/2013

In one of the comments below, Grayson from Debt RoundUp wrote…

Glad to hear that you finally jumped on board Josh. One thing you should mention is that Betterment does not offer a $25 sign up bonus if you are signing up for an IRA account. It only applies to non-IRA accounts. I just thought I would put that out there.

I looked into it and, Grayson is absolutely correct. Turns out, you don’t get the twenty five bucks on an IRA, awww shucks! So, a big thanks to him for making a great addition to this post!

Thanks For Reading – Please Answer My Reader Question…

Thanks for taking the time to read my article. If you have any questions, leave a comment, I’d love to answer them! If not, here’s one I’ve got for you…

Are you currently using Betterment.com? If so, what are your thoughts about it? If not, have you considered it?


  1. Thanks for using my comment. I first signed up just to get the $25. Like you said, good ROI, but I decided to keep it because I can make my monthly deposit without the trade fee every time. I’ll be curious to see how the final fees come out after a year, but I think I’ll come out ahead. Congrats on starting your fund.

  2. Hey Kim, thanks for stopping by. It seems like it works well. I’ve heard the returns on investment there are pretty high. Are you seeing a lot of growth?

  3. Hey Josh You have sparked an interest. I have to say I would be quite a bit more interested if I were to hear about your success with betterment. Keep us posted!!

    • Hey Naz, thanks for your comment. I hope that Betterment is successful for me. I promise, I’ll keep you posted!

  4. Thanks Josh for using my comment. Investment on betterment is a good idea and I would like to consider it in future. Would definitely love to know more about your growth in this betterment

  5. I’ve been hearing a lot of Betterment lately…I just read your post on Modest Money and will have to look into it. As of now, I have most of my funds in Vanguard target funds and I’m comfortable with that. But I’m always interested and curious to see how I can use new methods in my portfolio.

    • Hey Andrew, thanks for your comment! Betterment is definitely creating a name for themselves, that’s for sure! I’ve heard that Vanguard target funds work out pretty well. I may try that out as well. AS you said, it’s always good to look for new methods to use! Thanks again for stopping by!

    • Hey Lisa, thanks for your comment! Although I haven’t been with Betterment for too long, I can already say I love the simplicity of investing with them!

    • Hey Nick, thanks for your comment! I would definitely suggest doing some sort of investment with that money. Although, it’s not a huge amount, it probably has a lot of time to grow! You’d be surprised at what it could eventually grow to. Thanks for stopping by!

  6. Hey Josh. Betterment sounds like a good plan, except apparently one actually needs money to take advantage of its services. That is somethign I just don’t have! If I ever have enough where I think it may actually be prudent to use a service like Betterment, I’ll definitely check it out more 🙂

    Take care and all the best.


    • Hey Lyle, thanks for stopping by. Betterment seems like it’s good, the verdict is still out…I’ll let you know what happens. Keep up the blogging. I stopped by your blog and, you’ve got a lot to offer, I’m sure money is to come as long as you continue to help people by providing the answers they need. Thanks for stopping by!

      • Thanks Josh for the kind words of support and encouragement 🙂 Do keep me abreast of Betterment and best of luck on your “relaunch” and goal of hitting a K a week so that you can help out with the homeless.

        Take care and all the best.


        • Hey Lyle, my pleasure and thanks again for stopping by! I assure you, I’ll keep you up with betterment. I’ve always been told not to watch investments day by day because the money’s in the long term so, I’m sticking to it. I’ll check it monthly and, report what I find! As far as the goal goes, thanks for your support and encouragement, it’s because of that kind of support and encouragement that I know I’ll reach it one day! Thanks again!

  7. Josh, Great to see that you have taken the leap into investing; and at a young enough age to where you will really reap some benefits. The more time you have to let compound interest work its magic, the better. Moreover, the sooner someone develops – and starts executing – an investment plan, the less they will feel inclined to take unnecessary risks to get caught up once they realize their nest-egg is going to fall short. Paraphrasing a gentleman (his name escapes me) from the PBS documentary “The Retirement Gamble” (which I highly recommend!), “If you have been working since your early-mid 20s, and you finally decide to get serious about investing for retirement in your 40s, it is too late, that boat has sailed.”

    • Hey James, thanks for stopping by and showing your support. I can’t necessarily say I have a plan but, I do have a goal and, that’s a good start. Who knows if the goal is actually feasible , only time will tell but, I’ll keep you posted as time passes. By the way, “The Retirement Gamble” was a piece produced by Martin Smith and the link is here…http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/retirement-gamble/transcript-43/ thanks for mentioning a great resource! Se ya around!

      • Oh yes, I am definitely familiar with the documentary. I purchased it on Amazon and have watched it a number of times. I just could not remember the name of the gentlemen that I was paraphrasing.

        A goal is definitely a good start, but of course a solid plan is required to reach it. Shameless plug ahead…you should check out my book, and while I am just a little biased, the book is written around the idea of building and executing a plan, with detailed examples and accompanying spreadsheets.

  8. Glad to hear that you finally jumped on board Josh. One thing you should mention is that Betterment does not offer a $25 sign up bonus if you are signing up for an IRA account. It only applies to non-IRA accounts. I just thought I would put that out there.

    • Hey Grayson, thanks for stopping by and mentioning that crucial piece of information. I was under the assumption that it did but, I didn’t start an IRA so, I didn’t dig too much into the details there. I’m going to go and make an addition to the article right now…thanks again!

    • From what I’ve heard, it’s a great way to go. The $25 is a great perk but, what I’m really after is the returns. I’ll keep you posted. Thanks Troy, for stopping by!

  9. I haven’t used Betterment, but like you, I haven’t heard a single complaint about it, either. In fact, we interviewed the CEO of Jemstep, a competitor that I love, on the podcast, and even he was very kind about Betterment.

    Congrats on getting the ball rolling!

  10. Betterment sounds very interesting! I don’t currently have any investments what with focusing on paying off debt. But I certainly hope to invest once they are cleared. Please keep us posted with your progress!

    • Hey Debt Free One Day, thanks for stopping by and adding to the conversation! I’ll definitely keep you posted and, you’ll see me around your community too so, keep me posted on your debt freedom journey!

  11. I think Betterment is an excellent service. It is on the forefront of the next generation of investing for an under-served market. You have the “big guys” who only deal with clients that have $1 million or more. Then you have the basic services like Vanguard/T Rowe Price for those just starting out. But you don’t have anything for the in-betweeners that want good low cost investments and a little advice on the side that also provides instant info on the go. That is where Betterment enters the picture. Note that I am not putting down the other services, just saying they don’t fit the niche that Betterment serves.

    • Hey Jon, thanks for your comment. I keep hearing about Vanguard out there but, haven’t really looked into it because to the best of my understanding, you really have to manage those accounts and that takes time. I like Betterment because I can give them my money and they will invest it for me without me having to manage a thing. I have to agree with you to, it’s definitely what seems like a forgotten area until you consider Betterment, they’ve really got something going for them!

  12. I read that post on Modest Money and I have to agree no one had anything bad to say. I currently use merrill lynch and the reason is simply because I get free trades. I don’t get help or use anything else so I guess I could go with anyone. I just never heard of them until earlier this/last week. I really like where you are going with the site. I am looking at cutting down on posts and doing a lot more marketing and branding. Let me know if you need anything! Have a great weekend!

    • Hey Thomas, thanks for swinging by. Yea, the no fee for trades is a good way to invest no matter if it’s with Betterment, Merrill Lynch or any other service. Do you have to manage your accounts at Merrill Lynch or do you just deposit money and watch it grow? Thanks for your kind comments about my new approach, I felt it was necessary if I really wanted a blog that I could be proud of. Good luck on your shedding of YDF. If you need any help there, let me know. Thanks for your offer as well! See ya soon!

  13. Until now, I had not heard of Betterment.com. I’m definitely headed over to check it out. I’m always open to new ideas and methods of investment. Thanks!

    • My pleasure Dear Debt, thanks for stopping by. I’m learning as I go…if there’s anything I can do to help you along in your journey, please let me know!

  14. Hi Josh,
    Do you contribute to Betterment instead of a 401K or do you supplement it. Couldn’t you buy a Vanguard balanced fund from Vanguard themselves and pay lower expense fees? It looks like Betterment uses a lot of Vanguard funds, then charges a fee on top of it.

    • Hey Charles, from what I understand, Betterment breaks your money down into a few different types of advertisements. I don’t know if they can all be categorized overall as Vanguard funds, that would be an interesting thing to learn though. As far as buying Vanguard Balanced Funds personally, I wouldn’t know the first place to start. That’s why Betterment is so great for me. I don’t have to know how to invest to be successful at it. Or, at least that’s what they say, I’ll keep you posted on how it goes in the long run. Thanks for your comment!

    • Hey Suburban Finance, thanks for swinging by! To the best of my knowledge, anyone can use Betterment but, that’s my right off the top of my head answer. I’ll do some digging within the next few days and see what the real answer should be. Thanks again!

    • Hey Jacob, thanks for swinging by! I think I saw your review of Betterment. I’ve gotta agree with you, the only way to go cheaper is DIY! Thanks!

  15. Whoa thanks for the shout outs Josh!! Sorry it took so long to see this, I’ve been caught up in a bunch of things this past month and haven’t had much time to do blogging or much reading of other blogs. Thanks for the link love, was not expecting that when I opened this post lol.

    I’ve been using Etrade for most of my investment items and my track record has not exactly been great managing things myself. Will have to look into Betterment. I’ve heard of other people talking about it as well but hadn’t really paid attention to it. Might be time to hand over the management reigns lol


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