FutureAdvisor and Betterment differ in several little but important ways. Unlike FutureAdvisor, which is a bolt-on Robo-advisor that you can use on accounts housed elsewhere, Betterment is a fully complete Robo-advisor that works independently of any brokerage. We'll compare these two management approaches so you can choose which to employ.

FutureAdvisor

Perfect for senior citizens who have significant assets and want regular financial advisor advice, Due to the novel single-goal household account that the robot broker offers, it's ideal for investors and couples who don't want to set up joint accounts. aimed at investors with open accounts with TD Ameritrade and Fidelity

Betterment

Betterment is best for anyone looking for usability and simplicity. Geared for those who want to set and prepare for financial goals like purchasing a home, Excellent for those who want maximum transparency about the assets they are invested in

Setting of Objectives Betterment stands out among all Robo-advisors regarding goal setting. Thus, it should be no surprise that it defeats FutureAdvisor in this category. Objective-setting is made easy using Betterment's step-by-step instructions, and each type of goal can be monitored independently.

You may easily establish new goals at any moment and track your progress.

Equities and fixed income are displayed in a ring and various blue colorations. The site prompts you to increase automated deposits if you don't meet your goals. This could be a helpful reminder, especially for younger investors who might not feel the need to save for longer-term goals.

Betterment now allows you to sync external investments to the account interface to get a full picture of your progress toward goals where you manage multiple accounts, such as retirement. The repeated sales pitches to finance new accounts take away a little from the wonderful free planning analysis. Additionally, financial counseling sessions will cost you between $199 and $299 if you don't subscribe to the premium plan.

Account Structures

The most common account types, including traditional IRAs and taxable accounts, are covered by FutureAdvisor and Betterment. FutureAdvisor may be more enticing to parents or individuals looking to save money for future educational costs because it is also compatible with 529 college savings plans. However, it truly depends on which accounts you want to use when it comes to accounts. International diversity is included in the standard stock and bond ETF portfolio.

A socially responsible portfolio has a significant positive impact on society and the environment (note: investments may not meet standard requirements for this theme). Goldman Sachs's portfolio seeks to outperform the market.

The "Flexible Portfolio" of BlackRock ETFs is a bond portfolio with an income focus constructed from the asset classes of the basic portfolio but weighted following customer preferences.

Betterment accounts are dynamically rebalanced when they depart from the objective allocations that they were intended to have. Your portfolio also gets more cautious as the target date approaches to lock in gains and avert big losses. Because most investors lack the time and dedication to implement these good techniques on their own, customers will value this automated reallocation.

Investments with tax advantages

A popular strategy for tax-advantaged investment is tax-loss harvesting, in which wash sale laws and the impact of capital losses are considered before selling stocks. FutureAdvisor and Betterment offer tax-loss harvesting as a free service for taxable accounts at all funding levels.

Security

Both FutureAdvisor and Betterment employ strong 256-bit SSL encryption. Apex Clearing Corp administers client assets at Betterment and gives customers access to excess private insurance and the Securities Investor Protection Corporation (SIPC).

FutureAdvisor works with Yodlee, a "trusted third party," to safely gather and manage client information. When you utilize FutureAdvisor, your money is held by Fidelity and TD Ameritrade, which provide SIPC and excess private insurance.

Betterment's mobile apps are compatible with fingerprint, face, and two-factor authentication. Modern security is used by Fidelity and TD Ameritrade's mobile apps but not FutureAdvisor.

Customer Support

Betterment's customer service representatives are available by phone and email from 9 am to 6 pm, Monday through Friday, and 11 am to 6 pm on the weekends. During regular business hours, calls to customer service averaged 2:21 minutes on hold before reaching a knowledgeable representative. There isn't a live chat feature.

Methodology

Investopedia's mission is to provide investors with honest, comprehensive evaluations and rankings of Robo-advisors. The results of a six-month review of 32 Robo-advisor platforms—including their user interfaces, goal-setting skills, portfolio contents, charges, security, mobile usability, and client support—have led to our 2019 ratings. More than 300 data points we collected were considered in our grading process.