Too Busy To Invest?

If you’ve read through our site, you know we’re strong proponents of taking control of your finances, and becoming a better investor or trader.  Admittedly, this is no easy feat to accomplish and takes a significant amount of time, energy, and most importantly desire.

In some cases many of you possess the desire to have your money work for you, but do not possess the time nor energy to transmit this desire into reality.  Unfortunately, many people when faced with this problem give up, continue to stash money in their savings and call it day. But with the inflation rate moving at a percentage your savings account can’t keep up with, these people are essentially coming to terms with losing money.

There is a company we’ve found that fills this niche, and allows people without the time nor energy to actively invest still be invested in the market.  It’s called Betterment, and below is a review on a service we feel can be extremely useful for the passive investor.

What is Betterment?

It’s smart investing made easy. Betterment puts a personal investment account in your hands by blending the simplicity of an online bank account with the higher long-term returns associated with investing in stocks and bonds. The best part? You don’t have to spend nights and weekends researching.

Betterment is an SEC Registered Investment Advisor, and their broker company, Betterment Securities, is a broker-dealer regulated by FINRA and the SEC.

The money that you have invested with Betterment is protected by SIPC (up to $500K).


How to Invest with Betterment

Set up your user info, choose a password, and you’re almost done. It’ll take less than five minutes and there’s no minimum to sign up. You’ll be able to transfer and access your money by linking your Betterment account to your checking account. (And they never withdraw funds from your bank account without your permission.)

Now here’s where Betterment differs from your traditional broker.

At that point, Betterment takes over and you are free to move on and concentrate on other things. All you do is move their simple slider to set the ratio you want in stocks vs. bonds.  From there they invest your money in a mix of six stock Exchange Traded Funds (ETFs) and/or two treasury bond ETFs.  We would recommend you set up an automatic investing transfer then Betterment pulls out the predetermined amount every month and reinvests it, this way you don’t have to remember to put the money in, and more importantly don’t have to think about how much you could use that money in other areas in your life.

Who Should Use Betterment

Work long hours?  Spend most of your free time running the kids around?  But still want to start planning for the kids college tuition, or your retirement?  Betterment is for you.

Not really a numbers person?  Do stock charts, and financial filings look like gibberish to you?  Betterment may be for you.

Basically, if you have a strong desire to start planning a better financial future, but live a busy lifestyle that doesn’t afford you the time to stay on top of your investments, then Betterment is a great solution.

What I love about Betterment

• It’s very easy to use. Literally anyone can get up and running with these guys in 5 minutes.
• They limit their fund choices to arguably the best choices for the passive investor: broad index-based ETFs.
• They highly encourage automated investing, the best way to ensure you keep investing.
• They promote the idea of passive, long-term investing.
• They are transparent about their fees, and they keep fees simple.
• They are highly liquid. You can move your money in and out of the brokerage without fees.

Something to Remember

Just so that you aren’t confused, we want to remind you that Betterment is not a savings account, it is an investing account.  There is a difference, with an investing account your money is at risk. That’s why the reward can be much greater than a savings account.  But it does not offer the security you receive from a savings account.

Criticism

Some sophisticated traders will scoff at Betterment saying it dumbs down investing and does nothing to educate investors.

But that’s kind of the point, there is a very real problem in this country with people not investing.  Betterment operates on the notion that if investing were made easier more people would, so they look to fill that niche.   As far as education goes, they do provide plenty on their website.  They layout their philosophy, provide details on the ETFs they use and why.

Fact is this, if active trading isn’t for you; then Betterment allows you the opportunity to let your money work for you comparably to those who spend hours investing on their own.

If this is for you click below to get started and receive a free $25 for opening an account.

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