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Betterment Alternatives

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Robo-advisors are automated investment management tools that make it easy for beginner investors to gain some insight into the best ways to save money. Though there are a number of robo-advising services available on the market, Betterment, an online investing service, has risen above the competition with over $13.5 billion in assets under management.

Quick Look: Best Betterment Alternatives For This Year

  • Best Overall: M1 Finance – Open an Account
  • Wealthfront
  • Wisebanyan
  • Ellevest
  • Wealthsimple

Overview: What Is Betterment?

Known for its goal-based investing app, Betterment allows you to save towards retirement, a college education for your child, a new home or another long-term goal though automated investing.

When you sign up for an account with Betterment, you’ll be taken through an interview-style questionnaire that identifies your financial goals. Betterment will then create a unique asset mix of index funds and ETFs from up to 12 investing arenas.

You can even choose a “socially responsible” portfolio option, which creates your asset mix from pre-screened funds that meet certain criteria for employment diversity, environment and corporate responsibility and responsible manufacturing practices.

There is no minimum initial deposit required to get started with Betterment, and you can also sign up for Betterment Premium with a deposit of $100,000 that grants you access to more advanced savings and investing options.

While Betterment is the world’s most popular robo-advising service, it’s not the only one available. Start by reading our Betterment review – and if its app doesn’t appeal to you, consider one of our favorite Betterment alternatives. We’ve rounded up some of our favorite Betterment alternatives to help you make the right decision for your money.

Robo-Advisors vs. Human Advisors: Which is Right for You?

Robo-advisors offer you a cost-effective way to get some direction and information about where they should be putting your money to achieve your unique financial goals. How do you know if you should be using a robo-advisor or a personal financial advisor?

If any of the following situations apply to you, you may want to consider choosing a personal financial advisor in lieu of a robo-advising service.

You need holistic planning advice

Human financial planners and advisors shine when it comes to figuring out what’s going wrong (and right) in your financial management and creating a plan of action to reach your goals. Robo-advisors may be good and buying and selling assets for you, but they cannot look at your unique financial situation and provide advice for the future.

You have a high net worth or a large sum of assets

If you currently have a large amount of money that you’d like to invest or you already have a robust portfolio of stocks and bonds, your situation may be too complicated for a robo-advisor’s algorithm to handle. Consulting with a human financial advisor can help you protect your assets and grow them more effectively.

You are planning a major life change

No matter if you’re planning on buying a home, having a baby or filing for divorce, a financial planner can help you navigate the steps you’ll need to take to most effectively reach your goals in the coming months and years.  

Why Betterment Might Not Be for You

Betterment may not be for you – here’s why.

You want more control over where your money is invested

 As a robo-advising platform, Betterment automatically redirects your deposits into investments based on its goal-centered approach. While Betterment allows you to choose the goal that you’re saving toward and will generate a unique asset allocation strategy based on your needs, you do not have direct control over what stocks, bonds, and other assets are purchased. Experienced investors may find Betterment (and by extension, other robo-advisors) to be frustratingly limiting.

You want to keep your emergency fund in cash

Traditional financial advice has long dictated that one of your first financial goals should be to build up an emergency fund to cover unexpected car expenses, medical bills or other life-related bill. Because emergency funds are for actual emergencies, they need to be quickly accessible and held in cash.

If you “tell” Betterment that one of your financial goals is to create an emergency fund, your money will be directed into an allocation of secure stocks and bonds, which can be more time-consuming to liquidate in the event that money is needed right away. While it’s not difficult to open a separate savings account for your emergency fund, if you’re looking for an all-in-one solution, you may not like that a portion of your money is automatically diverted.

You don’t want to pay extra for access to human advisors

Part of Betterment’s management fee goes towards ensuring that you have access to human financial advisors. If you have a relatively normal financial situation, chances are that robo-advising services will be more than enough to cover your bases. If you’d like your fee to go towards other services, you may be better off choosing a different robo-advisor or investing service.  

The Best Betterment Alternatives

Benzinga picked the best alternatives to Betterment based on the criteria above.

1. M1 Finance

Commissions
FREE automated investing
Account Minimum
$100 for regular accounts $500 for retirement accounts
Best For
  • Don’t want to take an active role in portfolio management
  • Need a large amount of hand-holding when it comes to selecting investments
  • Want the option to invest in a socially responsible portfolio

M1 Finance is a unique robo-advising app that combines the power of technology with the personalized touch of human financial advisors. M1 Finance uses individualized mixes of stocks and bonds, called “pies,” to create the perfect combination of assets based on your goals and risk tolerance. Each individual pie can have up to 100 “slices,” each of which represents an individual stock or ETF.

Unlike Betterment, M1 Finance users can add or remove stocks and funds from their pie for a more personalized investing experience. Though M1 Finance does not currently support college 529 plans, you can quickly open a traditional, Roth, or SEP IRA, joint, taxable or trust account – or you can roll one over.

M1 Finance’s $0 minimum investment means it’s easy to get started even if you only have a bit of money to invest. It’s important to note that M1 Finance does not support the purchase of mutual funds; you are limited to stocks and ETF purchases at this time. However, if you’re looking for more control over where your money goes compared to Betterment, you’ll enjoy M1 Finance’s pie customization tools.

Read Benzinga’s full M1 Finance Review

2. Wealthfront

Best For
  • Passive investors
  • Lower fees
  • Beginning investors
  • Investors who don’t want to manage money on their own

Wealthfront is an automated investing service with over $10 billion in assets under management, making it America’s second-favorite robo-advising platform after Betterment. Wealthfront’s management fee is a low 0.25%, which is comparable to Betterment’s services. You can check out Benzinga’s full comparison of Betterment vs. Wealthfront, too. 

Like Betterment, the process of opening an account with Wealthfront starts with a questionnaire to determine your financial situation and goals. Wealthfront will then automatically allocate funds to a unique mix of 11 ETF classes. You can open a traditional or Roth IRA, SEP IRA, individual and joint taxable accounts, trusts, or even college savings plans though Wealthfront’s platform.

If your main future financial goal is to save for a child’s college education, you’ll love Wealthfront’s “Path” tool. The Path tool allows parents to create a 529 college savings plan or link one through an outside account; parents can then choose a sample college or university and the year that they would like their child to attend.

Wealthfront will project likely costs for tuition, housing, textbooks and other expenses usually associated with college. Wealthfront’s comprehensive college planning tools trump Betterment’s, which means that parents might feel more confident investing with Wealthfront if they plan to cover at least a portion of their child’s college education costs in the future. Though Wealthfront does have a minimum deposit of $500, its fees are low, the service is exceptionally streamlined and easy to understand, and it offers one of the best investing apps available.

Read Benzinga’s full Wealthfront Review

3. WiseBanyan

Best For
  • Brand-new investors
  • Those who are comfortable managing their finances solely online
  • Great technology

The best robo-advisors do everything they can to keep costs low – and WiseBanyan is no exception. Billing itself as the “world’s first free financial advisor,” WiseBanyan is one of the few robo-advisors to charge no account maintenance fees or no minimum account balance, which makes it an exceptional choice for beginning investors. You can check out Benzinga’s full comparison of WiseBanyan and Betterment, too. 

Though WiseBanyan charges for add-on investment services like tax-loss harvesting, these fees are capped at $20 per month. Automatic rebalancing is also offered for free on all accounts, and users can create a traditional IRA, Roth IRA, SEP IRA, or individual non-retirement account through the company’s app or desktop platform.

Like most other robo-advisors, Wisebanyan uses your individual situation and risk tolerance to create a unique mix of ETFs from 11 different asset classes suitable for your needs. WiseBanyan has also taken a page from Betterment’s book and introduced goal-based investing strategies that the company calls “milestones.”

If you like what Betterment offers but want to cut as many costs as possible, WiseBanyan is a great alternative. However, keep in mind that if you have a taxable account, you may want to choose an alternative that offers free tax-loss harvesting – you’ll be thankful you did when tax season rolls around.

Read Benzinga’s full WiseBanyan Review

4. Ellevest

Best For
  • Beginning to intermediate investors
  • Those looking for goal-based planning
  • Women investors who want to feel financially empowered and supported by their brokerage

Founded by Wall Street veteran Sallie Krawcheck, Ellevest bills itself as an outspoken women-centric investment firm. Ellevest’s management fees are comparable to Betterment’s at 0.25% for basic account holders, and the platform supports taxable accounts, IRAs, and 401(k) rollovers.

Unlike Betterment, Ellevest allows you to hold an emergency fund in cash – it even forgoes management fees for emergency funds to encourage their maintenance and creation. Ellevest also has one of the most expansive ETF selection profiles of the major robo-advising services, with the option to divide assets between 21 classes of funds. Ellevest supports a host of financial goals like Wisebanyan and Betterment, and the platform will automatically rebalance your accounts to place money into more conservative investments as you loom closer to accomplishment in order to limit risk and keep you on track.

If you’re under the impression that Ellevest’s female-centric platform is a marketing gimmick, know that the company offers differing investing strategies based on gender. Ellevest’s investing strategies take into account the wage gap and salary curve that separates male and female investors, recommending less risky investment profiles for women compared to their male counterparts.

Ellevest also automatically plans for a longer retirement period for female investors, as women tend to live longer than men and thus require more money during their golden years. Ellevest Premium also offers not only financial coaching, but one-on-one career planning consultations in an effort to help female investors negotiate their salary, move ahead in their careers, and close the wage gap between them and their male counterparts.

Obviously, you don’t need to be a woman to open an account with Ellevest, but the investing platform is an especially excellent choice for female investors who need a little more guidance with their saving selections.

Read Benzinga’s full Ellevest Review

5. Wealthsimple

Commissions
0.05% Of assets under management
Account Min
$0 to get started
Get started securely through Wealthsimple’s website
Commissions
0.05% Of assets under management
Account Min
$0 to get started
1 Minute Review

Wealthsimple is a hybrid robo-advisor with a set-it-and-forget-it approach to investing. Automate your investments, authorize Wealthsimple to round up your credit card purchases to the nearest dollar and watch your long-term savings build up with 1 of Wealthsimple’s comprehensive prebuilt portfolios. Socially responsible and halal investment portfolios are available as well if you prefer to invest a specific way.

Wealthsimple’s investing choices are limited and the platform is geared toward completely new investors who could be overwhelmed by too many technical options. Its education and customer service options need a bit of work, but we recommend Wealthsimple if you’re looking for a simple way to start investing from your desktop or mobile device.

Best For
  • New investors
  • Those concerned with the social implications of portfolio choices
  • Anyone who wants to automate investing
Pros
  • Simple questionnaire to find your perfect asset mix
  • Socially responsible and halal portfolios
  • Higher-level accounts come with perks like airport lounge access and human financial advisor reviews
Cons
  • Lack of choice could frustrate more experienced investors
  • Limited analysis tools and no charting functions available
  • Human advising isn’t free with all account types

Are you looking to navigate the stock market and grow your money without supporting unscrupulous business practices? Wealthsimple is a unique robo-advising platform that offers socially-responsible investing for beginners. Wealthsimple’s socially responsible index diverts funds into a mixture of six ETFs that focus on companies that develop clean technology, employ diverse hiring practices and invest in technology intended to forward the development of underserved populations and nations.

There is a $0 minimum investment to get started, and new account holders receive a free 15-minute phone call with a human financial planner to ensure that their robo-advising services have gotten them on the right track towards their goals.

If you are a follower of Islamic teachings, Wealthsimple also offers “halal investing” that allows users to create an asset mix solely of companies that are Shariah-compliant. Stocks in the halal investing portfolio are screened by a third-party council of experts in the Islamic faith, and companies that deal in haram products (alcohol, gambling, firearms, sex-related industries, etc.) are excluded.

The halal portfolio also excludes bonds, as Islamic law forbids followers from holding assets that accrue interest. Though Wealthsimple’s advisory fees are significantly higher than Betterment and other competitors at 0.50% of assets under management, socially-conscious and religious investors may be willing to pay the price for the added peace of mind.

Read Benzinga’s full Wealthsimple Review

Compare the Best Betterment Alternatives

Commissions
FREE automated investing
Account Min
$100 for regular accounts $500 for retirement accounts
Get started securely through M1 Finance’s website
Commissions
FREE automated investing
Account Min
$100 for regular accounts $500 for retirement accounts
1 Minute Review

M1 Finance is a unique investing platform that allows investors to allocate their funds through a strategy called “pie investing.” When you open an account with M1, you can choose from 1 of 80 expert portfolio allocations, which the platform calls “pies.” Each pie is made up of a unique mix of stocks and ETFs and each represents a “slice” of your overall account.

Pies distinguish themselves by their asset allocation and investment choices. For example, investors who want to hold onto their investments until they retire might choose a pie with a focus on slow, steady growth, while investors who value corporate responsibility may want to choose M1’s socially responsible investment portfolio. 

You can also create your own pie by selecting individual stocks and ETFs. Every time you make a deposit into your M1 account, the broker will automatically divide your funds between your investments.

M1 offers only basic educational tools and its customer support leaves much to be desired. However, if you’re looking for a way to put your investments on autopilot, M1 Finance might be the right choice for you. 

Best For
  • Don’t want to take an active role in portfolio management
  • Need a large amount of hand-holding when it comes to selecting investments
  • Want the option to invest in a socially responsible portfolio
Pros
  • Pie investing system offers a unique visual component to investing
  • Streamlined mobile app offers full functionality of the desktop platform, plus access to M1’s banking components
  • Socially responsible portfolio option is perfect for investors who want to invest only in companies that offer positive business practices
Cons
  • No access to mutual funds, futures, forex or options investing
  • Limited charting tools and indicators
  • Poor customer service selection
  • Basic educational offerings cater only to very new investors
Commissions
0.25% annual fee
Account Min
$500
Get started securely through Wealthfront’s website
Commissions
0.25% annual fee
Account Min
$500
1 Minute Review

Wealthfront offers automated investment services, customized according to the risk tolerance and investment goals of every investor. For assessing clients basic financial health, Wealthfront has designed a free financial planning solution, powered by its automated financial advice engine called Path. If you link all your accounts, Path can analyze your financial habits and help you determine where are your habits going to lead you in the future. Wealthfront also offers a high-yield cash account with a 2.51% APY, FDIC insurance up to $1M, and no fees. Investors who wish to invest their savings can use its automatic investing suite called PassivePlus at low cost. It offers the following strategies: Tax-Loss Harvesting, Stock-level Tax-Loss Harvesting, Smart Beta and Risk Parity.

Best For
  • Passive investors
  • Lower fees
  • Beginning investors
  • Investors who don’t want to manage money on their own
Pros
  • Relatively small fee
  • Goals and risk tolerance based strategies
  • Time-tested and academically proven investment strategies
  • Tax optimization
  • Financial planning and results tracking
  • Referrals program
  • High-yield cash account
Cons
  • No partial shares allowed
  • Doesn’t invest entire deposit
Commissions
Free Some instances you may be required to pay transfer fees of fund fees
Account Min
$0
Get started securely through WiseBanyan’s website
Commissions
Free Some instances you may be required to pay transfer fees of fund fees
Account Min
$0
1 Minute Review

WiseBanyan’s site methodically eases you in using a goal-oriented approach. The company offers a truly relatable, tangible way to save for your future and present goals. For example, you can designate your savings goals as “Vacation to Fiji” or “Retirement” (whatever you’d like!) which cleanly categorizes your goals into manageable chunks.

Risk aversion, time horizon, and money you’ve already saved are carefully considered for each individual goal and invested appropriately. It’s a slick way to manage money and is a solid way to end up with a fully-diversified portfolio while mitigating fees and tax consequences.

Best For
  • Brand-new investors
  • Those who are comfortable managing their finances solely online
  • Great technology
Pros
  • No account management fees
  • Automatic rebalancing is free on all accounts
  • No account minimums required
Cons
  • Only offers individual taxable accounts, traditional or Roth IRAs or SEP IRAs
  • Tax-loss harvesting is not included for free (which many robo-advisors offer automatically)
Commissions
0.25% Of assets under management
Account Min
$0 For a basic account
Get started securely through Ellevest’s website
Commissions
0.25% Of assets under management
Account Min
$0 For a basic account
1 Minute Review

Ellevest, although created with women in mind, is perfect for long-term investors looking to create a portfolio based on their goals, but need a little help. Quizzes, a clean interface, access to education, and low fees make it a great choice for beginning to intermediate level investors.

Best For
  • Beginning to intermediate investors
  • Those looking for goal-based planning
  • Women investors who want to feel financially empowered and supported by their brokerage
Pros
  • Low minimums and fees
  • Free emergency account management
  • Large exchange traded mix available
Cons
  • Limited customer support hours
  • Limited accounts supported
Commissions
0.05% Of assets under management
Account Min
$0 to get started
Get started securely through Wealthsimple’s website
Commissions
0.05% Of assets under management
Account Min
$0 to get started
1 Minute Review

Wealthsimple is a hybrid robo-advisor with a set-it-and-forget-it approach to investing. Automate your investments, authorize Wealthsimple to round up your credit card purchases to the nearest dollar and watch your long-term savings build up with 1 of Wealthsimple’s comprehensive prebuilt portfolios. Socially responsible and halal investment portfolios are available as well if you prefer to invest a specific way.

Wealthsimple’s investing choices are limited and the platform is geared toward completely new investors who could be overwhelmed by too many technical options. Its education and customer service options need a bit of work, but we recommend Wealthsimple if you’re looking for a simple way to start investing from your desktop or mobile device.

Best For
  • New investors
  • Those concerned with the social implications of portfolio choices
  • Anyone who wants to automate investing
Pros
  • Simple questionnaire to find your perfect asset mix
  • Socially responsible and halal portfolios
  • Higher-level accounts come with perks like airport lounge access and human financial advisor reviews
Cons
  • Lack of choice could frustrate more experienced investors
  • Limited analysis tools and no charting functions available
  • Human advising isn’t free with all account types

Final Thoughts

Betterment, Wealthfront and their robo-advising competitors are created with the hands-off investor in mind; they aim to make investing in the stock market as simple and worry-free as possible. However, if you’d like to take financial management into your own hands, a taxable brokerage account might be a better choice for you. Check out our lists of the best investing apps on the market and the best online brokerages.

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