In a Nutshell
- Competetive 0.40% APY on Cash Reserve accounts
- No monthly fees or minimum balance
- Reimbursed ATM fees for checking accounts
- No interest on Everyday Checking balances
- No physical branches
- Limited customer service
Betterment at a Glance
Personal loans available: No
Credit/debit card available: No
SMS/Mail alerts: Yes
24 hour customer service: No
Money transfers: Yes
Check scanning: Yes
Average APY: 0.40%
Minimum balance for APY: 0
Advantages Over Regular Bank
Online banks provide direct services to customers without any physical branches. The rise of smartphones has propelled the popularity of remote banking and additional mobile money management services. These ‘neobanks’ save on infrastructure and bureaucracy, passing time and cost savings on to their customers.
Some of the advantages online banks like Betterment have over traditional brick and mortar institutions include:
Higher APYs: Betterment offers a competitive 0.40% APY on savings with no minimum balance requirement - 5x the national average.
Easy-access financial services: Betterment started out as a robo-advisor, and customers benefit from budgeting, investment, and retirement planning capabilities from the comfort of a desktop or smartphone.
Low or no fees: Both Betterment Everyday Checking and Cash Reserve accounts are subject to no fees, including on overdrafts and transfers.
Seamless online experience: Most traditional banks now offer upgraded online services and mobile apps, but direct banks continue to lead the industry with mobile-first capabilities.
Cutting-Edge Banking Services
Betterment is a cutting-edge fintech company that offers customers a number of benefits and services that traditional banks typically do not.
Account syncing: Betterment lets you sync all of your accounts to get a fuller financial picture.
Cash analysis: Leveraging advanced algorithms, Betterment gives account holders real-time guidance on how to manage money and grow savings.
Two-Way Sweep: This unique opt-in feature automatically moves money between Checking and Cash Reserve accounts to maximize savings products and ensure adequate checking balances.
Investment accounts: Betterment delivers goal-oriented investing advice and asset allocation for any budget.
Traditional Banking Services
Betterment currently offers two traditional banking service options: Checking and Savings accounts. These accounts boast a range of benefits, including:
Contactless debit: Tap-to-pay enabled Visa® debit card linked to your Betterment checking accounts.
Global ATM access with no overdraft fees, minimum balances, or foreign transaction
Unlimited account withdrawals from your checking account
Cash Reserve high-yield savings products earns 0.40% APY.
One other feature that many savings accounts do not offer is unlimited withdrawals from your account. Typically, you are only allowed six withdrawals per month.
Cash Reserve accounts are FDIC-insured up to $1,000,000.
No minimum balance requirement
Direct deposit on checking accounts
Betterment does not currently offer credit cards or loans.
Interest Rates and Fees
One of the biggest benefits of Betterment's banking offerings is the lack of fees. Betterment Cash Reserve and Betterment Checking products incur no monthly fees, and there is no minimum balance requirement on either type of account.
While Betterment Checking account balances do not earn interest, high-yield Cash Reserve savings products earn a competitive 0.40% APY on any balance.
For investment accounts, Betterment offers two packages:
0.25% per year on invested balance under management, including all trading costs.
0.40% fee on invested balance under management and $100,000 account minimum
Betterment customer service is available by either phone or email, Monday through Friday, from 9:00 AM to 6:00 PM EST, and on the weekend by email only from 11:00 AM to 6:00 PM. Betterment customers can access online chat with login. In addition to standard customer care offerings, Betterment offers expert financial planning from seasoned professionals for Premium account holders. For Digital account holders, consulting a planner is available with additional cost.
Like many online-only banks, Betterment offers a robust Mobile App, including all of the functionality of the web version. Users can download the app for both iOS and Android devices quickly and easily. Betterment's mobile app delivers a range of useful features and a user-friendly interface.
Betterment prioritizes customer security and privacy with a robust array of measures to keep your money and identity safe:
Encrypted account information stored behind secure firewalls
Continuous security measure to safe-guard of data
Regularly scheduled internal and external security audits to protect against hackers
Two-Factor Authentication to protect your account
Automatic Logout of account after inactivity
Emil notification of any account changes
Identity Verification on all new customers
Third-party Verification from Digicert
All of this means that when you bank with Betterment, your money and your privacy will be secure and protected.
Betterment has been leading the robo-advisor industry for over a decade, and their recently released online banking products benefit from a mobile-first approach to money management. With no fees or minimum balances, generous APY on savings products, extensive security and privacy protections, and a host of additional services to grow your money, Betterment is a solid choice for anyone seeking seamless alternatives to traditional banks.
Disclosure: Cash Reserve is provided by Betterment LLC, which is not a bank, and cash transfers to program banks are facilitated by Betterment Securities.