I’ve written before on Betterment.com and given an overview of how it works. This automated investing platform is truly the best way to get your investing off the ground. And in this article I’ll tell you exactly why that’s true:
1. You do not have to research individual stocks and bonds.
If you were to decide to invest in your own, you would need to pick your own single stocks and bonds to invest in. There are literally HUNDREDS to choose from, and each one has it’s own trends, earnings figures, and day-to-day changes.
Betterment has already done that research for you. They’ve chosen some of the best mutual funds and bond funds available on the market. Once you join Betterment, you will be automatically invested in these funds. No need to get into the nitty-gritty details of stock picking.
You can see from this screenshot, Betterment spreads your money across 6 different mutual funds and 4 bond funds (emerging markets bond fund is the fourth). You can look up each of these funds and see that they are some of the best on the market right now.
2. Your money is never “locked up”. It’s always available for withdrawal. For FREE.
With most mutual funds and bonds, you have to leave your money in that investment for a specified period of time (from a couple months to a few years). If you choose to take your money our early, you would have to pay fines, forfeit any gains, and/or be charged a transaction fee.
Betterment has none of those fees.
Your money is always available for withdrawal. You will not forfeit your gains and there are no penalties.
This is a great benefit for beginner investors who may be concerned about having a significant amount of money tied up for a long time.
3. You can start with as little as $25. Most mutual funds require $3k – $10k to get into.
Betterment has made it possible for literally ANYONE to get into investing. In the past, you had to save up thousands of dollars before you could invest in the best mutual funds. But Betterment has changed that.
Start with $25 if you want. Get used to the ups and downs of the market. Get comfortable with the idea of investing and collecting a return. Then you can decide whether or not to invest more.
4. You control your level of risk.
Betterment allows you to spread risk in two specific ways.
First, your money is invested across numerous mutual funds and bonds. So no one bad stock can bring your entire portfolio down.
Second, you can further manage risk by choosing the percentage of your money that goes to stocks and bonds. If you want to be more aggressive, put more money into stocks. More conservative investors will lean toward bonds.
5. Monitor and Control your investment on-the-go with Betterment’s mobile app.
The Betterment App gives you the ability to transfer to/from your investment account, view your portfolio allocation, and even see the exact gains/losses on your account.
If you want, you can log in during the day and see how the investment are doing at any given moment. You can also adjust your stock/bond ratio directly from the app.
It’s nice to have such a convenient way to monitor and control your investments.
Hopefully this shed some light on why I’m a fan of Betterment. Try it for yourself today! You won’t regret it!