In the fast-evolving world of wealth management, staying current with technological innovation, transparent fee structures, and exceptional client support is paramount. Originally known as Personal Capital, the platform has rebranded to Empower, reflecting its renewed focus on a customer-centric approach while integrating modern features that address the ever-changing demands of high-net-worth (HNW) individuals. This comprehensive article delves into Empower’s evolution, updated fee structures, the latest user testimonials, new features, and a comparative analysis of how the platform stands against its competitors in 2025. By synthesizing data from industry-leading sources and real customer feedback, we aim to provide an up-to-date and balanced overview of Empower’s offerings.

The Empower Rebrand: A New Chapter in Wealth Management

Empower emerged from the rebranding of the once well-known Personal Capital, marking a turning point in its operational strategy and product suite. The rebrand is not just cosmetic; it signifies profound changes in the platform’s approach to client engagement, asset management, and service transparency. As of early 2025, Empower has restructured its value proposition to reflect more personalized services, innovative investment tools, and a renewed focus on client education. For additional insights on the rebranding strategy, readers can check out recent coverage at Money Stocker’s Empower Review 2023 and Money My Life’s updated review.

The rebranding effort has been met with a mixed response from the market. While many clients appreciate the refreshed look and the upgraded technological integrations, industry statistics reveal that only about 50% of high-net-worth individuals are entirely satisfied with their wealth manager’s performance. This dual feedback—positive acknowledgment of Empower’s innovations and candid client concerns about overall service satisfaction—has pushed the platform to double down on its commitment to improving customer experiences across all touchpoints.

Updated Fee Structure: Transparent and Competitive

One of the critical aspects that clients consider when selecting a wealth management platform is the fee structure. Empower has updated its fee range to 0.49% to 0.89% based on assets under management (AUM). This modernized fee structure is competitive in the market, especially when compared to similar platforms. However, it is important for clients to evaluate these fees in the context of the value provided—namely, the availability of personalized financial advice, advanced planning tools, and a state-of-the-art mobile experience.

What sets Empower apart is its commitment to transparent pricing. In an era where hidden fees have eroded client trust, Empower’s clear presentation of fees has stood out. The platform now incorporates detailed breakdowns that allow clients to understand exactly how much they are paying and what services they are receiving in return. In addition, client feedback has been instrumental in fine-tuning fee structures. This approach helps clients make informed decisions while comparing Empower against other traditional and digital wealth managers.

Competitive Interest Rates and the Empower Personal Cash Account

Apart from asset management fees, Empower provides additional financial products, including the Empower Personal Cash account. As of the current year, the Empower Personal Cash account offers competitive interest rates around 4.00% APY. In comparison to traditional savings accounts that often offer minimal yields, Empower’s rate is notably attractive. This feature makes it a valuable tool for clients looking to balance their savings and investments efficiently.

Because market conditions and interest rates are continually fluctuating, Empower recalibrates these offerings to ensure clients receive the best possible returns on idle cash. The ongoing reassessment of these rates highlights Empower’s dedication to maintaining a competitive edge in both investment management and cash management solutions.

Client Testimonials and Real-World Experiences from 2023 and Beyond

Since the rebrand, Empower has accumulated a range of client testimonials that shed light on the user experience from various perspectives. Recent testimonials highlight a number of key themes:

• User-Friendly Interface: Clients appreciate the intuitive design of the platform, noting that the updated layout and interactive dashboards have simplified asset tracking.
• Enhanced Financial Planning Tools: Many users have benefited from the augmented features that now include sophisticated budgeting, retirement planning, and real-time portfolio analytics.
• Responsive Customer Service: Despite mixed overall client satisfaction ratings, a significant number of users commend Empower’s customer support for prompt and effective problem resolution.
• Clearer Fee Breakdown: Testimonials frequently mention that the new transparent fee models have built greater trust among users.

Consider the case of one long-time client who remarked, “Since Empower’s rebranding, I’ve noticed a remarkable improvement in how I understand and manage my portfolio. The fees are transparent, and the advanced planning tools have transformed my retirement planning strategy. Although I still have some concerns about market volatility, the platform’s continuous updates have reaffirmed my confidence in their approach.”

Other reviews point out that client expectations from wealth management platforms are continually evolving. As highlighted in Capgemini’s World Wealth Report 2023, the broader trend among HNW individuals is a demand for greater personalization and proactive financial advice. Empower’s ongoing upgrades, focusing on real-time analytics and user experience improvements, directly address these expectations.

New Features and Enhanced Services: Innovations Post-Rebrand

Since transitioning to Empower, the platform has rolled out a series of innovative features designed to enhance client engagement and improve overall financial wellness. Some of these updates include:

• Advanced Dashboard and Analytics: The updated dashboard now provides a comprehensive view of all client assets, including detailed performance metrics and risk assessments. These updates enable clients to customize their views and tailor analytics to individual financial goals.
• Structured Onboarding Process: Recognizing that first impressions are critical, Empower has revamped its onboarding process. New clients now benefit from a guided, step-by-step setup that demystifies account configuration, investment selection, and long-term financial planning. This structured introduction has received favorable reviews for mitigating early confusion and streamlining the transition from other wealth management platforms.
• Integration of Real-Time Market Data: Clients can now access up-to-the-minute market trends, research analyses, and investment ideas. This integration allows for more proactive, informed decision-making, giving clients a tangible edge in tracking global economic shifts.
• Mobile Functionality Enhancements: The mobile app has been significantly improved to include intuitive touch controls, faster load times, and seamless integration with both social media and financial news feeds. These enhancements help users remain connected to their accounts even while on the move.
• Personalized Financial Planning Modules: Empower’s tools now offer personalized simulations that help users plan for various life scenarios. These simulations factor in potential market conditions, retirement funding needs, and unexpected financial emergencies, providing clients with a robust planning framework.

Each of these offerings is backed by continuous client feedback cycles. Empower ensures that this innovative spirit remains rooted in real-world usage and tailored to meet the evolving needs of modern investors. For further details on these enhancements, you may visit the comprehensive reviews at Money Stocker’s detailed Empower review and other industry portals.

Empower vs. Competitors: How Fees and Features Compare

The wealth management landscape is crowded, with numerous platforms striving to offer the best balance between technology and personalized service. Empower, with its updated fee structure ranging from 0.49% to 0.89% and its competitive cash account earning approximately 4.00% APY, positions itself attractively in this competitive arena. However, understanding how Empower stacks up against other platforms requires a detailed comparison beyond mere fee numbers.

Recent comparative studies indicate several key points:

• Fee Transparency: Unlike some competitors that bundle hidden costs within broad advisory fees, Empower provides a clear and detailed breakdown of its fees, empowering clients to understand the value they receive.
• Technological Innovation: The integration of real-time market data, advanced analytics, and a mobile-optimized interface gives Empower a technological edge over traditional advisors who rely on less dynamic systems.
• Client Satisfaction: While only about 50% of HNW individuals have reported primary satisfaction with their wealth managers, this statistic serves as a reminder that continuous improvement is necessary. Feedback suggests that platforms offering regular feature updates and clearer communication tend to score higher in client retention. Empower’s ongoing commitment to iterative improvements positions it as a front-runner in addressing these concerns.
• Personalization: One of Empower’s most celebrated features is its emphasis on personalized financial planning. This individualized approach is an area where many traditional wealth management services have fallen short. Empower’s tools use algorithms and client data to tailor insights and recommendations to individual lifestyles and financial ambitions.

It is essential for clients to conduct their research and consider both fee structures and quality of service when comparing these platforms. Detailed comparisons and client reviews can be found in industry analyses like the Capgemini World Wealth Report 2023, which provide a balanced view of current market dynamics.

Recognition and Awards: Recent Accolades for Empower

The rebranding to Empower has also been recognized in the industry through several recent awards and commendations. These accolades are a testament to both the qualitative improvements in client service and the quantitative performance enhancements introduced post-rebrand. Some recent recognitions include:

• Excellence in Digital Wealth Management: Empower received this honor for its innovative mobile and online platform that significantly simplifies financial management for a diverse clientele.
• Outstanding Client Service Innovation: This award reflected Empower’s investment in technology that directly addresses common client pain points through advanced support channels and user-friendly features.
• Top-Rated Financial Planning Tools: Industry observers and financial experts alike have noted the enhanced functionality of Empower’s planning modules. With features like scenario simulations and real-time market analytics, Empower has set a new standard for personalized financial planning.

These recognitions are not merely symbolic—they demonstrate how Empower is actively shaping the future of wealth management through continuous innovation and a steadfast dedication to customer-centricity.

Understanding Empower’s Onboarding Process: A Structured Approach to Better Client Experiences

For any digital wealth management platform, the onboarding process is crucial in setting the tone for the customer relationship. Empower’s revamped onboarding process is designed to guide new clients through each step of setting up their investments, understanding the fee structure, and using the platform’s powerful tools. The process is structured into the following phases:

1. Initial Consultation: Once clients sign up, they are greeted with a series of introductory materials that cover the basics of Empower’s services. This phase involves webinars, interactive tutorials, and one-on-one consultations.
2. Personalization and Goal Setting: Clients work with digital financial advisers to define their goals and risk tolerances. Detailed questionnaires and interactive tools enable the segmentation of financial objectives, ensuring that the advice received is tailored to individual needs.
3. Portfolio Customization: With a clear set of goals identified, clients are guided through the process of selecting portfolios that match their personal financial landscape. Advanced simulation tools make it easy to visualize potential outcomes under various market conditions.
4. Ongoing Education and Support: Post-onboarding, clients have access to continuous support through regular updates, performance reports, and market insights. Empower’s new customer service channels ensure timely responses and personalized troubleshooting, empowering clients to make informed decisions swiftly.

This structured approach reduces the friction commonly associated with digital wealth management platforms. New users, especially those transitioning from more traditional advisors, appreciate the clarity and control that the revamped onboarding process provides.

How Empower Channels Transparency and Continuous Improvement

Transparency remains at the core of Empower’s strategy. As part of its ongoing commitment to client satisfaction, Empower makes use of data analytics and regular customer feedback to refine its offerings. For example, the detailed fee breakdown not only helps clients understand costs but also allows Empower to identify areas where efficiencies can be improved. This emphasis on continuous self-improvement has been one of the key differentiators between Empower and some of its competitors.

The platform regularly publishes performance metrics and user satisfaction data to maintain an open dialogue with its client base. The updated metrics post-acquisition highlight both the improvements in operational practices and the ongoing challenges that need addressing. This data-driven approach means that Empower is not static; it evolves continuously based on real-world usage, client suggestions, and emerging market trends.

Addressing the Mixed Feedback: The Future of Empower

Despite the advancements, client surveys indicate that only about 50% of high-net-worth individuals report complete satisfaction with their wealth management services. This statistic, while concerning, has served as a catalyst for improvement within the industry, including at Empower. The company has established several client advisory boards and enhanced its survey protocols to capture detailed feedback. Specific areas of improvement include:

• More Personalized Communication: Clients desire regular, customized updates rather than generic statements. Empower has begun implementing segmented communication strategies based on individual investment profiles and risk appetites.
• Enhanced Performance Metrics: With new digital tools that track real-time market engagement and portfolio adjustments, Empower is committed to delivering more bespoke reporting services.
• Improvement in Market Responsiveness: Given the high volatility of financial markets today, Empower’s new integration of real-time data feeds aims to provide clients with actionable insights faster than ever before.

Moving forward, Empower is actively investing in artificial intelligence and machine learning technologies to further personalize client experiences. These advanced tools promise to analyze historical data, current market conditions, and emerging trends to deliver customized investment strategies that reflect each client’s unique financial landscape.

A Look at the Global Wealth Management Landscape in 2025

The wealth management industry in 2025 is markedly different from a few years ago. Digital platforms have become the norm, and client expectations now extend far beyond basic asset tracking. With an increasing number of consumers demanding transparency, empowerment, and personalized financial advice, Empower’s recent innovations are well-timed with industry trends.

Industry reports, including detailed insights from the Capgemini World Wealth Report 2023, show that the move towards digitalization in wealth management has not only driven operational efficiencies but has also redefined client interactions. Clients are now looking for platforms that provide:

• Instantaneous access to market data
• Easy-to-understand analytical reports
• Personalized investment strategies based on behavioral data
• Robust customer support coupled with technological innovation

Empower’s product enhancements, such as its cutting-edge mobile app and real-time analytics dashboard, address these needs head-on. Moreover, by offering competitive management fees and an attractive cash account APY, Empower is not only setting an industry benchmark but also actively shaping the future of wealth management.

Conclusion: Empower’s Journey Toward Excellence

Empower’s transformation from Personal Capital represents much more than a simple rebrand—it signifies a strategic overhaul aimed at addressing the modern needs of digital investors. The adoption of transparent fees ranging from 0.49% to 0.89% based on assets under management, the competitive 4.00% APY on Empower Personal Cash accounts, and the rollout of innovative features all point to a dedicated effort to elevate the client experience. Although only around 50% of high-net-worth individuals report full satisfaction with their current wealth managers, Empower is actively addressing these concerns through enhanced personalization, improved onboarding processes, and a commitment to continual service refinement.

The future looks promising for Empower as it continues to integrate advanced technologies such as artificial intelligence and machine learning. These technologies are set to further customize and optimize financial advice for a diverse range of investors. With an emphasis on transparency, education, and innovation, Empower stands as a robust platform in today’s competitive financial services landscape.

Whether you are a seasoned investor or a newcomer to digital wealth management, Empower’s updated suite of tools provides a compelling case for modern, client-centric financial planning. For those looking to navigate the intricacies of digital investing with confidence, Empower’s continuous evolution and commitment to transparency provide both reassurance and an effective means to manage and grow your wealth.

For further reading and regular updates on the latest trends in digital wealth management, you may want to explore additional resources on sites such as Money Stocker and Money My Life.

In conclusion, Empower’s journey reflects an industry-wide shift toward more personalized, transparent, and client-focused services. The platform’s commitment to regular updates, user-centered design, and proactive measures in response to client feedback promises to refine the wealth management experience now and into the future. As clients continue to navigate the digital transformation in finance, Empower stands ready to partner with them on a path of robust financial success and empowerment.

As we move further into 2025, the evolution of wealth management platforms like Empower will remain a central topic of interest. Stay engaged with the latest industry updates and client reviews to ensure that your financial management strategies align with the rapidly changing market dynamics. With continuous improvements and a steadfast focus on clarity and innovation, Empower represents a compelling force in modern finance.

The journey toward improved financial empowerment is never-ending. With a clear vision and steadfast dedication to client satisfaction, Empower continues to set new standards in the realm of digital wealth management. We encourage you to explore the platform firsthand, review the detailed service offerings, and consider how its innovative features can be harnessed to meet your unique financial goals now and in the future.

For more detailed analysis, keep an eye on industry reports and expert reviews that examine the broader wealth management ecosystem—a landscape that, while competitive, is vibrant with innovation and client-focused solutions. Empower’s latest advancements are an integral part of that narrative, showcasing how technology and personalized service can work in tandem to deliver a truly empowering financial experience.

Ultimately, the transition from Personal Capital to Empower is a reflection of the entire industry’s move toward enhancing client experience and embracing digital transformation. Whether you’re a long-term client or new to the wealth management scene, Empower offers a clear, transparent, and sophisticated platform designed to meet the demands of today’s financial world while positioning itself for the challenges and opportunities of tomorrow.

With comprehensive tools, transparent fee structures, and a commitment to continuous improvement, Empower provides an exciting blueprint for the future of wealth management. As we continue to monitor industry trends and technological developments, Empower remains a noteworthy example of how legacy platforms can reinvent themselves to best serve a modern, digitally-savvy clientele.

In summary, Empower’s reimagined approach to wealth management signifies remarkable progress towards a more accessible, reliable, and customer-focused financial advisory service. Keeping pace with real-time market dynamics, offering competitive rates, refining the onboarding process, and fostering client trust through transparency makes Empower a valuable partner for anyone looking to optimize their personal financial strategy in 2025 and beyond.

The article Exploring Empower: A Deep Dive into the Rebranded Wealth Management Platform was originally posted on Investormint

BETTERMENT SPOTLIGHT
InvestorMint Rating 1 2 3 4 5 5 out of 5 stars	Promo: Up to 1 Year Free Management Management Fee: 0.25% - 0.40% Account Minimum (Betterment Digital): $0 Account Minimum (Betterment Premium): $100,000 Get Started via Betterment secure site

In this Betterment review, you will see how Betterment stands apart from its competitors and why it deserves its perfect rating.

Betterment uses a sophisticated computer algorithm as well as a team of investment managers to manage client funds.

The company manages approximately about $22 billion in assets serving hundreds of thousands of investors, and feedback from Betterment clients is overwhelmingly positive.

From automated investment management to human advice and from retirement tools to smart saving, Betterment is the most complete robo-advisor and is virtually unbeatable on price.

Betterment Review

There are good reasons why over 500,000 people have signed up to Betterment.

While most robo-advisors launch their services with purely digital advice, Betterment has expanded its product offering to include a wide variety of additional features, including tax-loss harvesting, socially responsible investing, goal-based investing, and cutting-edge financial tools and calculators.

Although Betterment has been an industry leader for years, it strengthened its claim as the best robo-advisor when it added human financial experts to its already strong product offering.

With so many bells and whistles, you might expect Betterment to charge hefty fees, but its pricing is highly competitive, ranging from 0.25% to 0.40% depending on what service level you choose.

If you want automated investment management only, the lowest fees are charged however if you want access to human advice, you will pay the higher amount.

https://youtu.be/A-9II-zBq1k

Betterment Promo + Features

Betterment Promo

If you make a deposit within 45 days, you can receive a reward and with a deposit of $250,000+ get up to one year of automated investment management free.

You also get a free investment review to help you assess your current investment approach. Four areas are covered, including:

• Investment accounts
• Tax savings
• Fees
• Risk exposure

Is Betterment Right For You?

Betterment initially offered just a pure robo-advisor service, now called Betterment Digital. Now, Betterment includes Chartered Financial Professionals as part of its Premium offering; this has a higher minimum of $100,000, compared to no minimum for Betterment Digital. 

Fee-conscious, hands-off investors focused on the long-term will find Betterment portfolios to be a great fit.

Unlike traditional financial advisors, who typically charge north of 1% annually, Betterment fees are just 0.25% for its fully automated offering, Betterment Digital.

Customers who value support will find Betterment to be exemplary. Customer service is embedded in the Betterment culture. For example, CEO Jon Stein is known to answer customer phone calls from time to time, thereby setting the example across the firm that customer satisfaction is a top priority.

Betterment CEO Jon Stein

The company serves stock market beginners, savers and non-self-directed investors exceptionally well. The online portal is easy to use and complete with education, financial tools, and retirement calculators.

It’s easy to transfer funds, set financial goals to target retirement objectives and shorter term targets, such as buying a car, and even analyzing outside portfolios to gauge diversification and fee levels.

For clients wishing to save and invest for retirement, but who are not keen on a self-directed approach, Betterment is the de facto standard other robo-advisors aspire to reach.

Betterment portfolios are best for:

• Investors of any wealth level
• Investors focused on the long-term
• Hands-off investors
• Investors who want excellent support
• Retirement investors

RETIREMENT INVESTORS

Betterment doesn’t just serve growth-oriented investors who are a long way from retirement. It also offers a low-risk alternative to the Betterment portfolios that are designed for retirement investors, called the Blackrock Target Income Portfolio Strategy.

The portfolio is made up 100% of bonds with a range of income targets designed to provide steady income with low risk.

The interest earned from bonds is generally taxed as ordinary income, so it is best suited for a retirement portfolio that enjoys deferred tax breaks, like a Betterment IRA.

Open a Betterment Account

Betterment Fees

Betterment fees are tiered based on the customer plan selected:

• 0.25% of assets under management for Betterment Digital, which is a purely automated advisory and tools service.

• 0.40% of assets under management for Betterment Premium, which provides account monitoring by a team of Chartered Financial Professionals and permits unlimited phone calls and email access.

Open a Betterment Account

Reviews Of Betterment Investment Method

How good are Betterment returns? According to the robo-advisor, annual returns are 2.9% better than the average investor.

Betterment Investing Review: The company’s investment philosophy has been influenced by Robert Shiller and Eugene Fama, both Nobel Prize winners.

Betterment offers an automated investing solution designed to counter the risks associated with emotional investing, such as being greedy when markets are buoyant and selling in a panic when markets fall.

Betterment portfolios are designed to generate optimal returns for each level of risk appetite by creating low-fee, diversified portfolios made up of exchange-traded funds from up to 12 asset classes.

Proprietary algorithms are in place to automatically rebalance portfolios if certain positions start to drift and weigh more heavily on the overall portfolio.

BETTERMENT ETF STOCK FUNDS

BETTERMENT BOND FUNDS

Open a Betterment Account

Betterment Tools

Betterment’s stand-out tool is its advanced retirement calculator, RetireGuide. Other valuable tools help you to understand if you are overpaying on fees in your 401k, and help you to invest unused cash.

Retirement Calculator

Betterment provides a retirement calculator called RetireGuide, which calculates how much you need for retirement and whether you are on track to hit your financial goals based on a series of questions you answer.

Retirement goals can be applied to IRA, 401k, and taxable accounts. You can even link external accounts (e.g. bank savings account) to a Betterment Safety Net goal.

Retirement Advice Goals

RetireGuide is not a standalone service. Instead it is integrated to the Goals area so you and your spouse, for example, can project retirement income.

Retirement Goals provides advice on:

• How much to save for retirement each year
• How to spread money across taxable accounts, employer-sponsored plans, and IRAs

If you are not sure how much you should be saving each year and what income you can earn from your savings, the RetireGuide calculator can give you insights on these questions and other common ones, such as how much you can afford to spend in your retirement years annually.

The big idea is that spending and savings rates are compared to assess whether sufficient funds will be amassed by retirement to meet spending needs.

By understanding how much you plan to spend each year in retirement and how much you will earn from social security and other supplemental income sources, a nest-egg estimate can be approximated.

All you need to do is sync your existing bank and financial accounts, and Betterment figures out the rest.

Betterment Smart Deposit

Another nice feature we found as we conducted our Betterment review was Smart Deposit.

When you activate it, this tool automatically calculates how much excess cash you have in your bank account above a certain threshold and sweeps it into your Betterment accounts.

Betterment 401k Analyzer

Betterment allows users to connect third-party accounts, including 401ks, analyze fee-savings and recommends portfolio optimizations.

In our Betterment review, we found it easy to connect to outside accounts so portfolios held elsewhere can be analyzed to identify and improve upon expense ratios and performance returns.

External Account Analyzer

What separates Betterment from most robo-advisors is its external account analyzer.

It’s a cinch to set up alerts when high fees hit your account or you have excess idle cash sitting around.

And you will receive visual financial projections to see what your portfolio would look like if you rolled it over to Betterment.

The bottom line is goal projections factor in external accounts too.

Open a Betterment Account

Socially Responsible Investing

Socially responsible Investing (Betterment SRI portfolios) is available to all Betterment customers to better align their investment dollars with their personal values.

Is Betterment a good way to invest? Increasingly, customers demand robo-advisors invest their dollars in a way that is aligned with their philosophical beliefs.

You may wish to avoid companies that have controversial histories, such as oil spills and data hacks.

Highlights of Betterment SRI portfolios include:

• Tax loss harvesting and tax-coordinated portfolios supported
• No loss of diversification but a 42% increase in social responsibility scores on U.S. large cap assets
• Global diversification, tax optimization and cost controls maintained while orienting investments towards environmental, social, and governance criteria.

Open a Betterment Account

Betterment Flexible Portfolios

If your preferences differ from Betterment advice, you can choose Flexible Portfolios that provide you more control over how you allocate your capital to asset classes. 

Betterment Investing Review: Beyond socially responsible portfolios, Betterment now offers Flexible Portfolios to customers who want to exercise more control over their investing preferences.

You can modify asset class weights within a Betterment portfolio strategy and receive real-time feedback about how those changes affect portfolio diversification and risk.

The standard benefits apply to Flexible Portfolios, including  automatic rebalancing, Tax-loss Harvesting+, Tax Coordination+, and Tax Impact Preview.

The one caveat is you will need to invest $100,000 or more to gain access to Betterment Flexible Portfolios.

Betterment Tax Efficiency

Betterment Tax Strategy: The goal of investing is to put more money in your pocket, and while focusing on gross stock market returns is good, paying attention to how much you get to keep after taxes is important too.

To optimize for tax efficiency, Betterment uses two primary methods: tax-loss harvesting and tax-coordinated portfolios.

Betterment allocates money between taxable and tax-advantaged accounts to optimize for tax consequences.

TAX LOSS HARVESTING

When you have winners in your portfolio that you plan to sell, you can lower your tax bill by selling losers that count against those winners. This practice of counting losers against winners to minimize your tax impact is called tax-loss harvesting.

But if you have sold two positions, is your portfolio still diversified? Maybe not! And that’s why Betterment replaces the sold security with a similar one to ensure that your asset allocation is optimized.

Capital losses can lower your ordinary taxable income by up to $3,000 annually, creating significant savings over time.

Betterment claims that tax-loss harvesting can generate surplus returns of as much as 0.77% annually.

That may not seem like a lot, but over time it translates to an extra $44,692 in portfolio gains in a taxable account.

TAX COORDINATED PORTFOLIOS

How good is Betterment? Boosting after-tax returns in your taxable account via tax-loss harvesting is one thing but how do you minimize the impact of taxes across all your accounts, both retirement and taxable?

That’s where tax-coordinated portfolios come into play.

The idea in a nutshell is to put tax-inefficient assets into tax-efficient accounts and tax-efficient assets into tax-inefficient accounts.

If that sounds like a brainteaser, here is the simple way of thinking about it. A municipal bond already enjoys tax advantages, so Betterment wouldn’t put it into a retirement account, such as an IRA, that already enjoys tax benefits. Instead, the municipal bonds would be placed into a regular taxable account that is less tax-efficient.

Without asset allocation applied to accounts, a portfolio may look something like this:

But with asset allocation, the overall portfolio would look like this:

Betterment claims tax-coordinated portfolios can boost portfolio value by as much 0.48% per year, which translates to as much as 15% over 30 years.

Open a Betterment Account

TaxMin Lot Selling

Betterment has developed a series of rules called TaxMin that automatically apply when a security is sold.

Most brokers use an approach called FIFO (first-in, first-out) that compares when securities are bought and sold but Betterment examines not only the timeline of purchases and sales, but also the cost basis too in order to lower the tax impact of stock or ETF sales.

Betterment strives to generate higher returns after taxes by following a strict order in which lots are sold:

1. Short-term losses
2. Long-term losses
3. Long-term gains
4. Short-term gains

The idea is to exploit all taxable possibilities in one category before moving to the next.

In the example below, Betterment saves a customer $3,883 by using its proprietary TaxMin algorithm versus applying traditional brokerage FIFO rules.

Tax Loss Harvesting For Spouses

If you already have tax loss harvesting turned on in your own account, you can apply it to your spouse’s account too so that your overall portfolios as a couple are managed holistically as one to optimize for taxes.

Betterment Pros and Cons

Betterment has a demonstrated history of success attracting and retaining clients by offering low fees, superb customer support, access to Chartered Financial Professionals, and easy-to-use retirement tools. Although account minimums are high for more personalized service, the fees charged are highly competitive compared to traditional financial advisors.

Where Betterment Shines

Betterment Digital is designed to meet the needs of all sorts of investors, so there is no account minimum – a big advantage. The management fee is 0.25%, which is lower than or equal to the amount charged by competitors.

Best of all, financial advisors are available through in-app messaging, so investors aren’t completely on their own.

As a new customers enjoy promotional pricing on management services. For example, Betterment Premium regularly offers up to one year of free management with a qualifying deposit.

Outside of promotional periods, Betterment Premium clients pay 0.40% for extra features, including unlimited phone access to certified financial planners. There are no annual fees, transfer fees, or closing fees with a Betterment account, which can make a big difference for small investors.

While Betterment does most things quite well, there are a few areas of opportunity. If these are important to you, another provider might better fit your needs.

What You Need To Know

First, Betterment does not offer a tool for direct indexing. On large accounts, direct indexing may offer substantial tax savings. Investors with taxable accounts have reduced ability to isolate opportunities for tax-loss harvesting when they work with Betterment.

Next, some financial advisors disagree with Betterment’s strategy for investing funds intended to cover emergency expenses. They state that emergency funds should not be in an account that could lose principal, and they should be easy to access if needed.

In addition, distributions from investment accounts may incur capital gains taxes, while withdrawals from standard savings accounts do not.

Finally, some former clients have pointed out that moving their assets from Betterment to another firm is unnecessarily difficult. They indicate that the process is inconvenient and time-consuming. This could be an issue if you don’t intend to stick with the service long-term.

Betterment Review: Fees & Minimums

Betterment has competitive fee charges compared to other robo-advisors and substantially lower fees than most traditional personal financial advisors.

Open a Betterment Account

Betterment Account Types

Betterment manages the following accounts and advises on accounts that it will not manage, such as 401ks.

Is Betterment Safe?

Betterment uses bank-level security and offers SIPC protection on each account up to the maximum $500,000.

Betterment Review Summary

A new breed of investment tools has finally leveled the playing field. So-called “robo advisors” make it possible to automate your investment strategy, even if you don’t have millions in your account.

At the top of the list stands Betterment, a top-rated robo-advisor service that offers high-quality financial tools and support at an affordable price.

Should You Choose Betterment?

Betterment serves non-self-directed investors of all wealth levels who are fee-conscious and goal-oriented. In addition to its purely automated investment offering, Betterment Digital, Chartered Financial Professionals are available with higher account minimums for investors seeking more accessibility to experts.

As a top tier roboadvisor, it has lots of tools to support analysis of retirement objectives and provides free syncing with non-Betterment accounts to identify lower fee funds and improved allocation opportunities.

Plus, for customers looking for a little extra handholding, a nice feature Betterment provides is the ability to message licensed financial experts via the Betterment mobile app.

Betterment earns high marks for its focus on tax efficiency through tax-loss harvesting, tax coordinated portfolios, and even optimizing for tax impact across spouse’s portfolios.

The bottom line is if you want an automated investing solution that allows you to be hands-off and is jam-packed with portfolio-return-enhancing features and insightful tools all for a highly competitive cost, Betterment is very hard to beat.

Open a Betterment Account

Free Retirement Guide: Grow Your Wealth Automatically

The article Betterment Review 2021 was originally posted on Investormint

Wealthfront does not offer some of the bells and whistles that other robo-advisors provide but in three very key areas Wealthfront makes a compelling case to earn your business.

1. Where Betterment and Personal Capital offer dedicated financial advisors for their premium offerings, Wealthfront has remained a pure robo-advisor. But where Wealthfront shines is its focus on tax-optimized investing, an underappreciated yet very important consideration that can enhance after-tax portfolio performance by up to 2% annually according to Wealthfront.
2. Wealthfront also distinguishes itself as the only robo-advisor in our review sample that offers a 529 Plan, which is a tax-advantaged savings plan designed to encourage saving for future college tuition costs.
3. When it comes to fees, Wealthfront is nearly impossible to beat. It has a highly competitive fee schedule and one of the best introductory offers of any robo-advisor: zero fees for the first $10,000 of assets under management.

Wealthfront Spotlight

WEALTHFRONT SPOTLIGHT
InvestorMint Rating 1 2 3 4 5 4 out of 5 stars	Management Fee: $0 for first $10,000 An additional $5,000 managed free for each friend invited who signs up Management Fees thereafter: 0.25% Account Minimum: $500 Get Started via Wealthfront secure site

Wealthfront Customers

Wealthfront targets fee-conscious investors who prefer a hands-off investment experience that is highly automated and who have no need or desire to connect with a dedicated human financial advisor. It’s also designed for investors who value the benefits of tax-optimized investing as well as those who may have or be guardians to children and wish to start saving for college tuition expenses.

Wealthfront has always offered a low-fee robo-advisory service and, unlike Betterment which added dedicated human financial advisors in 2016, remains a pure robo-advisory service.

For investors who desire the hybrid of a human financial advisor and the low fees associated with robo-advisory firms, Personal Capital and Betterment may be better choices. But for investors who need less hand-holding or have simpler financial situations that don’t warrant portfolio oversight or analysis from a dedicated advisor, Wealthfront has ample features to recommend it.

Wealthfront does have fast response times to answer customer phone calls but surprisingly does not offer a Live Chat feature, which is virtually standard across robo-advisory and brokerage firms. Email support is available but customers should choose phone communication for urgent issues.

Wealthfront serves Millennials, beginner investors, retirees, and hands-off investors well. With a pure robo-advisory service, Wealthfront provides the intuitive, easy-to-use website interface and simple navigability expected of a company that wants customers to spend time on its website.

Wealthfront is best for:

• Millennials
• Hands-off investors
• Retirees
• Fee-conscious investors
• Tax-aware investors

Wealthfront Management Fees

Wealthfront has perhaps the most competitive fees in the industry.

• 0.0% for the first $10,000 of assets under management
• 0.25% thereafter

In addition to higher long-term client portfolio returns from lower fees, Wealthfront claims that its tax-loss harvesting service enhances returns by up to 2% annually. Balances over $100,000 are required to avail of the tax-loss harvesting service.

Open a Wealthfront Account

Wealthfront Investment Method

Similar to Personal Capital and Betterment, Wealthfront stacked its team with renowned financial veterans who lend credibility to its investment philosophy and methods. Dr. Burton Malkiel is the Chief Investment Officer for Wealthfront and author of the renowned book A Random Walk Down Wall Street.

Wealthfront seeks to optimize risk-adjusted returns by allocating assets to a diverse group of sectors, including domestic and foreign stocks, emerging markets, bonds and natural resources. Low expense ratio exchange-traded funds are used to keep costs low though these costs are passed onto clients as is the industry norm.

Customers should be aware that Wealthfront does not perform the same level of in depth due diligence via its short questionnaire as a human financial advisor might when evaluating risk tolerance and setting an investment allocation. Plus, fractional shares are not supported meaning that some cash is left uninvested, which creates a drag on portfolio performance.

Wealthfront employs a tax-optimized investment method called Direct Indexing. This approach is applied to accounts over $100,000 and works by purchasing up to 1,001 individual securities versus a single ETF of an Index Fund and identifying individual tax-loss harvesting opportunities.

Wealthfront Tools

Wealthfront launched Path to compete with Personal Capital’s Retirement Planner Tool and Betterment’s RetireGuide, allowing clients assess spending capacity in retirement and savings adjustments needed to realize retirement objectives.

Wealthfront provides a financial planning tool called Path that is designed to identify where a client sits relative to retirement goals. Path allows clients better understand the impact of saving more monthly as well as the probability of maintaining their current lifestyle in their retirement years.

Like retirement tools offered by other robo-advisors, such as Betterment’s RetireGuide, Wealthfront links third party accounts that are subsequently analyzed to assess retirement spending capacity.

Wealthfront Pros and Cons

Wealthfront is a low-fee leader among robo-advisory firms. It’s also the only robo-advisory firm in our sample company list that offers 529 Plans. Its focus on tax-optimized investing via tax-loss harvesting is in our view an underrated advantage that the company claims increases annual returns by 2%. Investors looking for more human interaction via a dedicated financial advisor would be best served elsewhere, such as Personal Capital or Betterment.

Wealthfront Fees & Minimums

Wealthfront has competitive fee charges compared to other robo-advisors and substantially lower fees than most traditional personal financial advisors.

Wealthfront Accounts

Wealthfront distinguishes itself in supporting not just individual and joint non-retirement accounts, Roth IRAs, Traditional IRAs, SEP IRAs, Rollover IRAs, and Trusts but also 529 Plans – unlike other robo-advisory firms.

Wealthfront Tax Strategy

Wealthfront’s Direct Indexing investment method on accounts over $100,000 is a tax-optimized strategy that purchases up to 1,001 individual securities versus a single ETF of an Index Fund to improve tax-loss harvesting.

Wealthfront Summary

Wealthfront focuses on tax-optimized investment methods that optimize for the all-important after-tax returns. With exceptionally low fees, but no dedicated financial advisors, Wealthfront is an ideal solution for hands-off investors who are seeking an automated investment solution.

Parents and guardians will be attracted to Wealthfront as the sole robo-advisory firm in our sample set offering 529 Plans.

Wealthfront also has the tools to support visualizing and analyzing retirement objectives and recommend actions needed to best achieve them.

Open a Wealthfront Account

The article Wealthfront Review 2020 was originally posted on Investormint