Moving off Betterment

When I got my first big adult job, I was trying to figure out long-term financial planning. I stumbled upon YNAB, which gave structure to my finances in a way that I needed at the time. The YNAB book mentions the importance of investing in a way that's so simple that you don't have to worry about it and specifically recommended Betterment.

I don't regret the choice! Betterment has a fantastic UI and really taught me the importance of goal-oriented investing. There have been many points over the years when I've checked in and asked myself whether the money Betterment is sucking up in fees is worth what they're providing me. For many years, the ease-of-use has been worth it. I don't like thinking much about money and I like it when I see a nice graph going up or down. If someone wanted to start investing today, I wouldn't say going with Betterment is a bad choice.

But lately I've actually done the math on how much money I've earned that has been eaten up by Betterment fees, and it's in the thousands! Meanwhile, the main benefit, tax-loss harvesting, becomes less useful the more what I own appreciates in value. At this point, seven years into investing, it doesn't make sense to pay for software that delivers minimal return for what I own.

Not only that, in the last couple years, the UI of many other investment products has improved dramatically. I no longer feel like the marginal improvement in user-friendliness is worth it compared to say, M1, Vanguard or Fidelity, all of which have much lower fees and support a similar goals-based account system for dividing up investment assets.

So I've started moving my stuff out of Betterment! The easy decisions are IRAs, for which tax-loss harvesting provides no value, but if that goes well, the rest of the stuff will follow. I can set up my more manual investment platform to buy assets the same way I do at Betterment, which will take a little work, but then I'll be free of these management fees.