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Investing

Wealthsimple vs Betterment: Which Robo-Advisor Is Best for You?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

If you’re a hands-off investor, choosing a robo-advisor could be a great option. You can invest your money and set up recurring deposits, and the robo-advisor will do all the heavy lifting. If you’re trying to decide on the right robo-advisor for your investments, both Wealthsimple and Betterment are great choices.

Both robo-advisors allow you to invest in exchange-traded funds (ETFs) based on your risk tolerance level. However, Betterment offers lower fees and cheaper expense ratios for investors with $100,000 or less under management. By contrast, Wealthsimple caters to more seasoned investors. And, if you have over $100,000 under management, you’ll get access to elite perks like VIP airport lounge access.

We created a side-by-side comparison to help you decide between these two excellent robo-advisors and choose the one that’s right for you.

Wealthsimple vs Betterment: Feature comparison

Wealthsimple Betterment
Amount minimum to open account
  • $0
  • $0
Management fees
  • 0.5% (less than $100K deposited)
  • 0.4% ($100K+ deposited)
  • 0.5% (less than $100K deposited)
  • 0.40% for Premium offering ($100,000 minimum account balance)
Account fees (annual, transfer, inactivity)
  • $0 annual fee
  • $0 full account transfer fee
  • $0 partial account transfer fee
  • $0 inactivity fee
  • $0 annual fee
  • $0full account transfer fee
  • $0 partial account transfer fee
  • $0 inactivity fee
Account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • Custodial Uniform Gifts to Minors Act (UGMA)/Uniform Transfers to Minors Act (UTMA)
  • SEP IRA
  • Trust
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • SEP IRA
  • Trust
Portfolio
  • ETFs cover 10 asset classes.
  • 12 asset classes represented in ETF portfolio
Automatic rebalancing
Tax loss harvesting
Offers fractional shares
Ease of use
Mobile app iOS, Android iOS, Android
Customer support Phone, Email Phone, Email

Wealthsimple vs Betterment: Management fees

Neither Betterment or Wealthsimple have account minimums, allowing new investors to get started right away. Both charge a flat annual management fee, with no extra fees for transactions or trades.

With Wealthsimple, your annual fee is dependent on the amount you invest:

  • Basic: For investors with up to $100,000 under management, there is a 0.50% annual fee. That fee includes a personalized portfolio, expert financial advice, auto-rebalancing and dividend reinvesting.
  • Black: If you have over $100,000 under management, your annual fee is 0.40%. You get all the perks of a Basic plan, but you also get a financial planning session and VIP airline lounge access.
  • Generation: Seasoned investors with at least $500,000 under management get all the perks of a Black plan membership, as well as a dedicated team of advisors, access to in-depth financial planning and individualized portfolios. There is a 0.40% annual fee for the Generation plan.

For beginner investors, those fees are significantly higher than Betterment’s. For Betterment Digital accounts, which have a $0 minimum, the annual fee is just 0.25%. With that fee, you’ll get personalized financial advice, diversified investment portfolios, automatic rebalancing and tax-saving strategies.

If you have over $100,000 invested with Betterment, you can sign up for a Premium plan, with an annual 0.40% fee — putting it at the same price as Wealthsimple. You’ll get all the benefits of the Digital plan, plus in-depth advice on investments you have outside of Betterment, such as your 401(k) accounts. You’ll also have unlimited access to certified financial professionals (CFPs) to get guidance whenever you have a major life change, like getting married or retiring.

Regardless of which company you choose, make sure you pay attention to expense ratios. The expense ratio is a fee you pay when you invest in ETFs, which covers the company’s operational and administrative costs. It’s deducted directly from your investment, and can impact your total returns.

The exact expense ratio you’ll pay depends on your investment portfolio, but in general, the range for average expense ratios of Betterment’s recommended portfolios was 0.07% to 0.15%, depending on allocation. At Wealthsimple, the expense ratio tends to be higher; it’s about 0.20% each year.

Wealthsimple vs Betterment: Special features

Both Wealthsimple and Betterment support individual investment accounts, traditional IRAs, Roth IRAs, SEP IRAs, joint accounts and trust accounts.

Rather than investing in individual stocks, both companies focus on investing in ETFs. They look at your finances and risk tolerance level to determine your portfolio. For example, more aggressive investors will invest mainly in stocks, while conservative investors will place more of their money in bonds.

In particular, both companies offers socially responsible portfolios, allowing you to invest in companies that are supporting the common good.

However, one instance in which they differ is in investor education. While Betterment does post informational articles, Wealthsimple takes it a step further, offering an “Investing Master Class,” a free 45-minute video course that will teach you investing basics. There’s also a series of personal finance articles to help give you a background in essential financial topics.

And if you are looking to get a higher rate of return for your savings, both Betterment and Wealthsimple offer high-yield options.

Betterment Everyday Cash Reserve is a high-yield savings account, currently offering an APY of 1.83%. When you deposit your money, Betterment distributes it to up to four different partner banks. That means you’ll get up to $1,000,000 in FDIC insurance, protecting your money.

Wealthsimple offers the Wealthsimple Save option. It’s not a savings account, but a low-risk investment account. You’ll earn an average annual yield of 1.66%, but that number can fluctuate based on market conditions. Since it’s an investment account, funds kept with Wealthsimple aren’t FDIC insured.

If you’re looking for a safe place to grow your money and are trying to decide between the two options, Betterment Everyday Cash Reserve is likely a better choice than Wealthsimple Save. It offers a higher rate of return, there’s no risk of losing money and it’s FDIC insured.

However, that’s still a lower APY than you could get elsewhere. For example, with VioBank, you could earn up to 1.75% APY by opening a high-yield savings account.

CompanyAccount NameAPY
WealthsimpleWealthsimple Save1.66%
BettermentBetterment Everyday Cash Reserve 0.30%
VioBankHigh-Yield Online Savings1.75%

Wealthsimple’s advantages

  • Roundup: Wealthsimple offers a roundup option, allowing you to invest your spare change. Whenever you make a purchase, Wealthsimple will round up the purchase to the nearest dollar, depositing the difference into your investment account.
  • Halal investing: For investors who abide by Islamic law, Wealthsimple offers Halal Investing. Portfolios are screened by a third-party committee of Shariah scholars, and there are no investments in companies that profit from gambling, tobacco, or restricted industries.
  • VIP airport lounge access: If you have at least $100,000 under management with Wealthsimple, you’ll qualify for a Black account. As an added perk, you’ll get a complimentary Priority Pass membership, giving you unlimited access to over 1,000 airline lounges in over 400 cities. If you were to purchase a Prestige Priority Pass on your own, it would cost you $429, so it’s an excellent value.

Betterment’s advantages

  • Charitable donations: With Betterment, you can decide to donate share donations from your account rather than cash. You’ll help a charity, plus you’ll avoid capital gains tax on the sale of your investments. Eligible charities currently include UNICEF, World Wildlife Fund, Feeding America, Big Brothers Big Sisters of NYC, Boys and Girls Club of America, Breast Cancer Research Foundation, Save the Children, Wounded Warrior Family Support, Hour Children, Against Malaria, DonorsChoose and GiveWell.
  • Tax-loss harvesting: Betterment offers tax loss harvesting, a practice of selling securities that have experienced a loss. By harvesting the loss, you can offset taxes on gains and income. The security that is sold is replaced by a similar one, maintaining your asset allocation.
  • Satisfaction guarantee: If you are not satisfied by your experience with Betterment for any reason, the company will try to make it right — that may include waiving management fees for the next 90 days.

Wealthsimple vs Betterment: Which is best for you?

If you’re looking for a robo-advisor, both Betterment and Wealthsimple are strong options. However, new investors will likely prefer Betterment. For investors with $100,000 or less under management, Betterment offers lower fees and lower expense ratios.

Conservative investors who are looking for a safe place for their emergency fund will likely find a better home for their money with Betterment, too. As an FDIC-insured savings account, your money can grow without the market exposure of Wealthsimple Save.

However, seasoned investors who want more personalized attention, comprehensive financial planning and more luxurious benefits will prefer Wealthsimple. Once you get over $500,000 under management, you’ll get access to a dedicated team of advisors and get an individualized investment portfolio. And, of course, the VIP airport lounge access perk is an added benefit jet-setters will enjoy.

If you’re still exploring your investment options, make sure you check out the best robo-advisors of 2020.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Investing

Personal Capital vs Betterment: Which Robo-Advisor Is Best for You?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

If you’re looking for a robo-advisor to handle your investments, two major players to consider are Personal Capital and Betterment. These two services offer a range of investment account types and beneficial features. However, they cater to very different customer groups.

Betterment has fewer investment options, but there are no account minimums and it has lower fees on smaller balances, making it an excellent option for new investors. By contrast, Personal Capital appeals to more seasoned investors. It requires customers to have at least $100,000 in investments, but the company offers individual stock investment options and more personalized attention.

We created a side-by-side comparison to help you differentiate between these two robo-advisors and choose the one that’s best for you.

Personal Capital vs Betterment: Feature comparison

Personal Capital Betterment
Amount minimum to open account
  • $100,000
  • $0
Management fees
  • 0.89% for accounts of $100k - $1M
  • 0.79% for accounts of $1M - $3M
  • 0.69% for accounts between $3M and $5M; lower fees for accounts over $5M
  • 0.25% for Digital offering (no minimum account balance)
  • 0.40% for Premium offering ($100,000 minimum account balance)
Account fees (annual, transfer, inactivity)
  • $0 annual fee
  • $0 full account transfer fee
  • $0 partial account transfer fee
  • $0 inactivity fee
  • $0 annual fee
  • $0 full account transfer fee
  • $0 partial account transfer fee
  • $0 inactivity fee
Account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • SEP IRA
  • Trust
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • SEP IRA
  • Trust
Portfolio
  • Personal Capital offers 6 high-level asset classes.
  • 12 asset classes represented in ETF portfolio
Mobile app iOS, Android iOS, Android
Customer support Phone, 24/7 live support, Email, 5branch locations Phone, Email
Open a Personal Capital accountSecured
on Personal Capital’s secure website
Open a Betterment accountSecured
on Betterment’s secure website

Personal Capital vs Betterment: Management fees

If you’re looking to invest your money, it’s important to pay attention to the fees robo-advisors charge; they can vary widely from company to company. Particularly if you don’t have a lot of money to invest, Personal Capital will be more expensive than Betterment, and it has a higher minimum investment.

Personal Capital’s robo-advisor option requires you to invest at least $100,000 to get started, and charges a tiered annual fee based on the assets you have under management. This fee covers the investment advice you receive, asset custody, and trade commissions:

  • Up to $1 million: 0.89%
  • First $3 million: 0.79%
  • Next $2 million: 0.69%
  • Next $5 million: 0.59%
  • Over $10 million: 0.49%

That is the only fee you’ll pay with Personal Capital; there are no transfer fees, inactivity fees, or monthly maintenance fees.

For new investors, Betterment provides excellent value with low fees. There is no account minimum to get started, and there is a 0.25% annual management fee for its Digital plan. If you have at least $100,000 invested and want more personalized attention, you can upgrade to Betterment’s Premium plan and gain over-the-phone access to financial experts. The Premium offering has a 0.40% annual management fee.

For investors with more assets, those fees can be even lower. If you have over $2 million under management through Betterment, your annual fee drops — to 0.15% for the Digital plan and 0.30% for the Premium plan — on the portion of your balance over $2 million.

With Betterment, your fee covers the cost of the advice you receive, transactions, trades, and account administration; there are no additional transaction fees.

Another factor to consider is the companies’ expense ratios — how fund’s assets are used for administrative or operational expenses. The higher the expense ratio, the lower your returns will be. Personal Capital reported that its average expense ratio is 0.08%. By contrast, Betterment posted that the average expense ratios of its recommended portfolios was 0.07% to 0.15%. Keep in mind that these expense ratios are dependent on your allocation, and is included solely for comparison’s sake.

Personal Capital vs Betterment: Special features

With both Personal Capital and Betterment, you can connect outside accounts to get a more complete picture of your finances and better plan for your financial goals accordingly.

However, Personal Capital offers more features for seasoned investors, including 24/7 call access, even on weekends. You’re also eligible for advice on 401(k) allocations and insights into your cash flow and spending.

If you have at least $200,000 invested with Personal Capital, you’ll get even more additional features, including two dedicated financial advisors, customizable investments in individual stocks and ETFs and planning services for saving for college. Once you have over $1 million in assets, you’ll get access to estate planning services, too.

By contrast, Betterment lacks many of those features. You can only invest in ETFs and not individual stocks, regardless of your investment level. And, while you can invest in individual investment accounts and IRAs with Betterment, you can’t create a college savings plan.

If you’re looking for a cash management option in addition to your investments, Personal Capital and Betterment both offer high-yield savings options. Note that the top option on our list of the best high-yield savings accounts does offer a better APY than either robo-advisor’s cash management account.

  •  Betterment Everyday Cash Reserve: With Betterment’s Everyday Cash Reserve you’ll earn 0.30%  APY; there are no fees. You’re also eligible for up to $1 million in FDIC insurance; funds are deposited in up to four partner banks, each offering $250,000 in coverage. If you elect to exclude certain partner banks from receiving deposits, your level of FDIC insurance may be lower.
  • Personal Capital Cash: Personal Capital Cash has no account minimum, and allows you to earn 1.05% APY. Your money is also insured by the FDIC, and you’ll get six times the coverage of what most banks offer.
CompanyAccount NameAPY
Personal CapitalPersonal Capital Cash1.55%
BettermentBetterment Everyday Cash Reserve1.83%
VioBankOnline Savings Account1.95%

Personal Capital’s advantages

  • Personalized attention: As a Personal Capital customer, you get access to a 24/7 customer service line and can talk to a financial advisory team. As your investments grow, you will also get access to two dedicated financial advisors.
  • Individual securities: With Personal Capital, you can invest in individual stocks, not just ETFs.
  • Socially-conscious investment options: Personal Capital’s Socially Responsible Personal Strategy program seeks out companies that are positively impacting environmental, social, and governance issues.
  • College planning: Personal Capital offers an Education Planning tool you can use to plan for college costs, including determining how much you need to save each year to pay for school.
  • Tax optimization: Personal Capital works to optimize your tax bill by avoiding mutual funds and allocating high-yield stocks and fixed income into tax-deferred or exempt accounts. It also engages in tax loss harvesting, using individual securities to offset gains or qualify for a deduction.
Open a Personal Capital accountSecured
on Personal Capital’s secure website

Betterment’s advantages

  • Low account minimums: Betterment doesn’t have an account minimum, so you can start investing with just $1, rather than having to wait until you’ve saved enough money.
  • Fractional shares: Betterment allows you to purchase fractional shares, so you’re able to invest your entire deposit.
  • Hands-off investing: Betterment is perfect for investors who want to set-it-and-forget-it. You can make an initial deposit, set up recurring investments, then allow Betterment to do the heavy lifting by rebalancing your account for you based on your risk tolerance.
  • Charitable investing: With Betterment, you can donate shares rather than cash to partner charities including UNICEF, Feeding America, Wounded Warrior Family Support, and GiveWell. Not only will you be able to help a worthy charity, but you’ll also avoid the capital gains tax on the sale of your investment.
Open a Betterment accountSecured
on Betterment’s secure website

Personal Capital vs Betterment: Which is best for you?

When it comes to deciding between Personal Capital and Betterment, think about your current financial situation and your future goals.

If you’re new to investing, don’t have much money to deposit or want to be a hands-off investor, Betterment is likely the better choice for you. It offers lower fees, has no account minimum, and completely manages your investments for you. Plus, you can invest in fractional shares, making every dollar work harder for you.

If you have at least $100,000 to invest, and need more personalized attention or assistance with saving for college or estate planning, Personal Capital may be a better fit. Personal Capital has higher fees than Betterment, but you get 24/7 access to support staff, and you can even talk with dedicated financial advisors.

Fees

N/A

Account Minimum

$100,000

Promotion
N/A
Fees

N/A

Account Minimum

$0

Promotion

Three months free for new customers who are referred by an existing Betterment account holder

If you’re still exploring your investment options, make sure you check out the best robo-advisors of 2020.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Investing

Betterment vs Wealthfront: Which Robo-Advisor Is Best for You?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

If you are shopping for a robo-advisor to handle your investing needs, you’ve likely read about Betterment and Wealthfront. These two services are among the most prominent and popular robo-advisors, and both offer a very similar range of features and fees. We have made a side-by-side comparison to help you differentiate between the two apps.

Betterment’s service features a narrower range of investments, but has more control and lower fees for bigger balances. By contrast, Wealthfront offers a broader range of highly-automated investment options, as well as college education savings accounts. Read on to get a firmer grasp on the other differences between these two leading robo-advisors.

Betterment vs. Wealthfront: Feature comparison

Investment portfolios at both Wealthfront and Betterment are built from different combinations of exchange-traded funds (ETFs), including both bond and stock funds to better meet differing levels of risk tolerance. Betterment builds customized portfolios of ETFs across 12 different asset classes. Wealthfront features 20 different automated portfolios, and each offers a different mix of ETFs across 11 asset classes. In both cases, the mix of ETFs in each portfolio is altered to satisfy different goals. Both periodically rebalance your portfolios as asset values change and markets fluctuate.

Wealthfront offers a highly-automated process. You answer a short questionnaire to assess your goals and risk tolerance, and the app places your money in one of its 20 portfolios. Betterment offers investors with over $100,000 in their account more control over their investment choices, giving you access to live advisors and letting you adjust the percentage invested in any particular ETFs.

Betterment Wealthfront
Management fee
  • 0.25% for basic portfolio
  • 0.40% for premium offering (requires $100,000 minimum balance)
  • For account balances of $2 million or greater, the basic portfolio fee is 0.15%, and the premium offering fee is 0.30%
  • 0.25% annual advisory fee on investments
Average ETF expense ratio 0.11% 0.09%
Account minimum $0 $500
Human advisors Yes, for clients with at least $100,000 invested No
Fractional shares Yes No
Tax loss harvesting
College savings options No Yes
Investment account types
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • Joint taxable
  • Roth IRA
  • Rollover Roth IRA
  • SEP IRA
  • Trust
  • Individual taxable
  • Traditional IRA
  • Roth IRA
  • 529 Plan
  • Joint taxable
  • Rollover IRA
  • Rollover Roth IRA
  • SEP IRA
  • Trust
Savings account option Earn 0.30% APY with no fees and FDIC insurance covering up to $1 million Earn 0.26% APY with no fees and FDIC insurance covering up to $1 million
Ease of use
 
 

Betterment vs. Wealthfront: Management fees

In terms of management fees, Betterment and Wealthfront are very similar. Betterment charges an annual fee of 0.25% for investment balances up to $100,000. Wealthfront’s fee is 0.25% regardless of your investment balance. For balances greater than $100,000, Betterment’s premium option provides access to a team of live financial advisors, with a management fee of 0.40%.

If you have a very large balance to invest, Betterment may be a better choice than Wealthfront. When your Betterment account balance exceeds $2 million, your management fee falls to 0.15% for the basic portfolio and 0.30% for premium service.

With both companies, don’t forget ETF expense ratios. The expense ratio is a fee you pay to invest in ETFs to cover the cost of running the fund, including operational and administrative costs. The expense ratio is deducted directly from the fund, and can impact your investment performance. The expense ratio is dependent on your portfolio, but for the sake of comparison, the average expense ratio on a medium-risk portfolio is 0.11% at Betterment. At Wealthfront, it’s 0.09%.

Betterment vs. Wealthfront: Special features

Betterment and Wealthfront both offer the ability to add your outside investment accounts — such as an employer-offered 401(k) — to your account. You can’t manage the outside account from the robo-advisor dashboard, but they let you to view all of your accounts on one site, giving you a complete snapshot of your finances.

Where they differ is in their investment options. Betterment’s investment portfolio is more limited than Wealthfront’s. Wealthfront allows you to invest in some trendier options, including real estate investment trusts and commodities.

Wealthfront’s Path digital financial planning tool stands out from Betterment. It’s designed to adjust along with your finances, helping you plan for long-term goals, like retirement or buying a home.

On the other hand, Betterment’s tax-coordinated portfolios are an asset for investors with large balances. Betterment will spread your investments across multiple accounts. Highly-taxed investments will be invested in IRAs to minimize taxes, and the rest will be invested in taxable accounts. According to the company, this strategy can increase your portfolio value by an estimated 15% over 30 years.

Betterment’s advantages

If you’re new to investing or want more personalized attention, Betterment offers some distinct advantages over Wealthfront.

  1. There’s no account minimum: Unlike Wealthfront, which has a $500 minimum to start investing, there is no account minimum with Betterment. That means beginners can start investing with whatever they can afford. That perk can be especially helpful for people who might otherwise put off saving for retirement.
  2. You can purchase fractional shares: Betterment allows you to buy fractional shares, or portions of a whole share, so the full value of your investment is utilized. Plus, fractional shares allow you to buy shares that would otherwise be too expensive for a new investor to afford.
  3. You can earn decent interest on your savings: You can maximize the money that you aren’t investing with Betterment’s Everyday Cash Reserve. It offers a competitive APY of  0.30%a significant increase over the 0.10% rate you get with most traditional savings accounts.
  4. You could have access to a human advisor: If you have at least $100,000 invested with Betterment, you can get access to a human advisor to help you with issues like tax management and estate planning. If you have a smaller account, you can still get one-time access to a human advisor by buying planning sessions, which range from $150 to $500.
  5. You can donate to charity: Betterment recently launched Charitable Giving, a service that automates the process of donating appreciated shares to charities. You can determine how much you want to donate and what charity you would like to give money to, and Betterment will calculate your tax impact and will select the investments to donate.

Wealthfront’s advantages

For more seasoned investors, Wealthfront offers some more advanced options to grow your money.

  1. You can take advantage of a high-yield savings account: Wealthfront offers a high-yield savings account that earns an APY of 0.26%. Funds in account are held with partner banks, which provide FDIC insurance of up to $1 million.
  2. Wealthfront Stock-level Tax-Loss Harvesting: Formerly known as Direct Indexing, Wealthfront’s Stock-level Tax-Loss Harvesting allows you to lower your tax bill even more. Available for investors with taxable accounts balances between $100,000 to $500,000, Wealthfront will buy individual stocks from the S&P 500 index, giving you more opportunities for tax-loss harvesting.
  3. You can save for college: If you want to save for your child’s education, you can open up a 529 plan with Wealthfront. Withdrawals from a 529 plan for qualified education expenses — such as tuition, room and board, and textbooks — aren’t subject to federal income tax, making saving in a 529 plan more advantageous than just investing in an Individual taxable account. With fees of no more than 0.46%, a Wealthfront 529 Plan costs less than many other plans.
  4. You can get access to a Portfolio Line of Credit: If you need cash to pay for a trip or a major purchase, you may qualify for a Portfolio Line of Credit with Wealthfront. With this option, you have access to a line of credit that is secured by your investments. Depending on your account size, you could get an interest rate of 4.70% to 5.95%, which is significantly cheaper than you’d get with a credit card or most personal loans. If you have a Wealthfront individual, trust, or joint investment account with a balance of at least $25,000, you automatically have a line of credit available.
  5. You can easily diversify your investments: With Wealthfront, you can invest in low-cost ETFs, instantly diversifying your portfolio. Investing in ETFs minimizes your investment risk and, over time, can help you grow your money. Wealthfront looks for ETFs with the lowest annual expense ratios that also offer liquidity, so you can access your money to pay for major expenses, like buying a home or paying for college.

Betterment vs. Wealthfront: Which is best for you?

Wealthfront fully embraces the robo in robo-advisor, offering no human interaction and a highly-automated investing service, with no options for picking your own stocks or ETFs. If you’re looking to invest and forget it, then Wealthfront is probably your best bet, especially if you’d like to have a 529 college savings account as well.

Betterment offers a limited range of investable assets, however with enough money you can access human advisors, and also get more meticulous control over which stocks and ETFs you’re investing in. Fractional share investing and the zero account minimum make it a slightly better choice for beginning investors.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.