BETTERMENT VS WEALTHFRONT 📈 Which Platform Is The Best? Best Education Page #Online Earning

- Hello once again guys.

I hope you're having a fantastic day.

So in this video here, we're going to be talking about

the differences between Wealthfront and Betterment.

And I'm going to honest with you guys,

there are not a lot of differences.

They're offering very similar services.

Betterment was doing it first

and then Wealthfront came on the scene

a couple of years later.

And so if you're doing your due diligence here,

you're looking at a robo-advisor and trying to decide

which one to invest in,

hopefully this v
ideo will help you understand

the differences between the two.

So first of all, both of these are robo-advisors.

And robo-advisors are these automated investing platforms.

Traditionally you would pay a financial advisor

to look at your financial landscape,

figure out your risk tolerance and

what assets you should be involved in.

And as a result, you're either paying them

a sales commission through the funds you are buying or

you are paying them a flat fee,

if they're a fee-only financial advisor,

to tell you what you should be investing in.

And then your financial advisor is going to be continuing

to change your allocations and re-balance as you contribute

more money, they're gonna figure out

where should I put that money.

Now these robo-advisors are able to do the exact same thing

as these financial advisors.

But because there's no human involved in this,

it's going to be significantly less expensive.

The other thing is that financial advisors typically only

work with clients that have a certain amount

of money to invest.

Otherwise it's just not worth their time.

But with these two companies, with Betterment and

Wealthfront, you can be investing with 500 dollars

in Wealthfront's case or zero dollars minimum

for Betterment.

So you don't have to have a massive amount of money

to get some guidance on what you should be doing with it.

So these robo-advisors are a low cost alternative

to the traditional financial advisor.

And the two most popular ones out there

are Betterment and Wealthfront.

And I'm going to cover the differences

between these two accounts for you now.

First of all, the main one is that Wealthfront

has a 500 dollar minimum to get started and

Betterment has a zero dollar minimum.

So if you have less than 500 bucks and

you wanna get started, Betterment would be your option.

And if you guys are interested in opening an account

with Betterment or Wealthfront, I have links

for both of them down in the description below.

They are affiliate links.

You do not have to use them but if you do,

it helps support my channel.

And it helps to allow me to make more videos like this,

educating people about investing.

The second difference is a little bit more technical

but that is the fact that Wealthfront allows direct indexing

while Betterment only allows you to be holding

Broad Market ETFs.

Now this is a service that is reserved

for people with a 100,000 dollar minimum.

So you have to be investing with Wealthfront and

you have to have over a 100,000 dollars in your account.

But then you can take advantage of direct indexing.

And what that means is, rather than investing

in an S&P 500 ETF where you're capturing the whole market,

you're investing all 500 of the stocks and

holding individual stocks themselves.

And where that comes into play is with tax loss harvesting.

Betterment offers daily tax loss harvesting.

Wealthfront does the same thing.

But if you have over a 100,000 in your account,

you can do direct indexing by those individual stocks

and then they can sell individual stocks,

take advantage of capital losses and

cut down on your tax bill.

So essentially, it gives you more opportunities

to take advantage of small capital losses

to offset your capital gains.

This is a service offered only

by Wealthfront and not Betterment.

So if you have a 100,000 dollars or more to invest,

and you want to take advantage of direct indexing

then Wealthfront is the way to go.

The third difference is that Wealthfront offers a service

called Tailored Transfer whereas you can actually transfer

your assets if they're compatible,

into your Wealthfront account over time.

So traditionally, let's say you have a bunch of

individual stocks that you're holding.

You wanna move that money over to a robo-advisor.

You're gonna have to sell all of those stocks

and then you're going to have to move that into cash,

move it into the new account and then have it be invested.

Well, when you do that, you're exposing yourself

to capital gains.

And maybe you don't necessarily

wanna sell these investments.

You still wanna hold them but you just want them

to be in your new account.

Wealthfront allows you to transfer those assets in over time

if they fit into your portfolio.

And they have to be compatible assets.

So if you have options or you have futures in there,

or you have penny stocks, those are probably

not gonna be compatible with your Wealthfront account.

You're gonna have to move those into cash and then

move that cash into your Wealthfront account.

But if you do have individual stocks,

they will be able to transfer those

into your Wealthfront account over time

through something called Tailored Transfer.

And that is a feature that only Wealthfront has to offer.

The fourth difference is that Wealthfront offers

the 529 College Savings Plan.

So if you are investing for college savings,

that is going to be something you can only do

with Wealthfront.

Betterment does not support that type of account.

Number five is that Wealthfront offers

a portfolio line of credit.

You have to have a 100,000 dollars minimum in that account.

But once you have that, you can actually get

a line of credit and use your investments as collateral.

This is a service that only Wealthfront has to offer.

So let's say you want to draw a line of credit

to purchase a home or if you need that money for some reason

without having to sell your investments, you can actually

borrow money and use your investments as collateral.

That is a feature that only Wealthfront has available

at this point in time.

And Betterment does not offer that

line of credit against your account.

And then finally, Betterment does offer Betterment Premium.

It is a 0.4 percent annual fee rather than 0.25.

And with that service, you get unlimited access

to financial planners, you can call them up anytime and

talk to them about your investments.

And so for people who want to have that in-person

communication, you're going to want to go with Betterment.

Other than that, they are pretty much identical.

They're both offering robo-advisory services,

investing you in ETFs.

And they both charge a 0.25 percent annual fee

for their services.

Beyond that, those are the only differences

between the two accounts.

And then I don't remember if I mentioned this or not

but Betterment Premium is for people with a 100,000 dollars

in their account or more.

So most of these differences are for people who have

more than a 100,000 dollars in their account.

If you have less, then there is really no difference here.

And as far as which one to pick, both of them are great.

But if you have more than a 100,000 dollars to invest,

it may be these little things here and there

that make you decide to go with one over the other.

But these are the only differences I found

in these two accounts.

But anyways guys, thank you so much for watching this video.

If you are interested in opening account with Wealthfront or

Betterment, I have a link down in the description

for both of them.

Like I said, they are affiliate links,

you do not have to use them.

But it certainly does help me out, help support my channel

and allows me to make more videos like this.

But thank you guys so much for watching.

I hope you have a great rest of your day.

And I will see you in the next video.

If you are interested in learning more about investing

in the stock market, I've created a free course

just for you.

The link is in the description below.

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