On paper, they’re very similar, but as you know, the devil is in the details. Investment Philosophy – Betterment vs. Vanguard vs. Wealthfront. For most investors, management cost is identical. ETF stands for “exchanged traded fund”. Additionally, as Wealthfront states in their disclosure, “past performance does not guarantee future results. The question is, how does Wealthfront compare? Wealthfront charges the same 0.25% annual advisory fee that Betterment charges, but it also charges a fund fee of 0.07% to 0.16%, depending on the funds your money goes into. Unlike Betterment, Wealthfront requires a $500 account minimum to begin investing. My name is Paul. Your risk tolerance and goals influence your portfolio composition on Betterment and Wealthfront. Betterment vs Wealthfront Tax-loss Harvesting Both Betterment and Wealthfront enable tax-advantaged investing through tax-loss harvesting. Future performance may also deviate from past results due to changes in recommended asset allocations, as well as differences in future market returns.”. That said, Wealthfront provides a full whitepaper that shows how robust their methodology is in dealing with taxable events. Betterment vs. Wealthfront Comparison Costs and Fees. Premium Betterment accounts include all of the features from Digital accounts. But ultimately, there isn’t a ‘right’ answer to the Betterment vs Wealthfront debate. Millions of Americans who don’t have the time or financial acumen to build and monitor an investment portfolio are turning to robo advisors for good reason. Betterment has no minimum initial investment compared to $500 for Wealthfront. Betterment … Cooper is a former equity research professional/finance analyst who holds an MBA in Financial Instruments and Markets from New York University's Stern School of Business. In summary, not worth it if you can manage yourself since you can get more by managing by own! Some links herein may be from our partners. We love questions, comments, and suggestions! Betterment and Wealthfront are two of the most popular robo advisors on the market. It’s clear there is a market for this type of investing solution given robo advisors have been growing in popularity. What is an ETF? Their methods for tax harvesting are similar, … This is an undeniably bold statement. Each of these three robo-financial advisors operates according to the Modern Portfolio Theory (MPT), wherein asset allocation is … But Betterment has more advanced functionality such as direct real-time contact with financial advisors via encrypted text messaging, spousal tax loss harvesting, and tax coordinated portfolios. Financial Advisors: Finally, seeking advice from a certified financial planner (CFP) is also a viable route to take for your wealth management. Like Betterment, Wealthfront focuses on minimizing fees, lowering taxes, and managing risk for their investors. Securities that are sold in tax-loss harvesting are replaced by similar securities in order to maintain the same asset allocation in a portfolio. $500 minimum to open an account. Some of the offers and recommendations that appear on this website are from companies that compensate us. Betterment vs. Wealthfront–The Basics. For instance, Vanguard’s S&P 500 ETF (ticker: VOO) is one of the worlds largest ETFs. Opinions expressed are solely those of the author and have not been reviewed or approved by any advertiser. There is no minimum initial investment to open an account. Under no circumstances should any information from this blog be used as replacement for professional financial advice. However, each robo advisor lists their historical returns since inception. Wealthfront requires a minimum of $500 to invest; Betterment doesn't. 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