Updated September 29, 2022

Betterment Fees: What You Need to Know

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Betterment offers no minimum deposit and good returns. But are the fees worth it? Read on to learn about this robo-advisor's costs.

Betterment Robo-Advisory Fees

Betterment charges a monthly or an annual advisory fee for their digital portfolio management service. Your fee is based on your account balance.

There are two service tiers:[1]

  1. Digital Plan
    Less than $20,000 with a $4 monthly fee. You automatically switch to a 0.25% annual fee if you reach $20,000 or more across all your accounts or set up a recurring monthly deposit of $250 or more. This basic service tier has no minimum balance requirement. It includes:

    • Automated portfolio management
    • Automatic rebalance
    • Tax loss harvesting
    • Fractional shares investing
    • Access to Customer Support Team

  2. Premium Plan
    $100,000 or more with a 0.65% annual fee. The premium plan is optional for those with at least $100,000. You get all the benefits of the Digital plan plus:

    • Proactive account management
    • Advice on outside investments
    • Unlimited access to financial experts for guidance on life events like retirement, saving for college, etc.

How fees work: The fee is based on your account balance. Let's say you have $20,000 in your Betterment portfolio. At the 0.25% Digital service tier, your fee will be $50 per year.

What the Fees Cover

The annual advisory fee covers all aspects of your portfolio management. You pay no additional trading costs.

The fee includes:

  • Transfers and transactions
  • Buying and selling securities
  • Automatic rebalancing
  • Tax loss harvesting
  • Advice from CFP Professionals (for the Premium plan)
  • Other account administration
  • Retirement planning tools

Discount for High Balances

For investors with balances over $2 million, the portion above $2 million gets a 0.10% fee discount. That lowers the fees to:

PlanFees and Conditions
Digital Plan0.15% for the portion above $2 million
Premium Plan0.30% for the portion above $2 million

Expense Ratios

Betterment invests your portfolio in ETFs, which have a fee called an expense ratio. This is the operating cost of the fund, such as for management, administration, compliance, marketing, etc.

Users will pay this in addition to their annual advisory fee, which Betterment does not control or profit from. Expense ratio fees are deducted directly from the fund's assets. Keep in mind that these fees do reduce your net asset value a little.

However, the platform's recommended portfolios have, on average, expense ratios of 0.07% to 0.15%.[2] This is considered relatively low.

If you have $1,000 invested in a fund with a 0.15% expense ratio, you will pay $1.50 per year for the operating costs.

How Fees Are Charged

The fees are deducted from your Betterment investing account at the end of each month based on your account's daily average balance.

The fee is automatically deducted from your account balance. There is no extra action on your part.

If you withdraw your entire balance before the end of the month, you'll only be charged the prorated fee for the days your money was with Betterment.[3]

Betterment never charges a fee if your account balance is $0.

Advice Packages

Betterment recently added financial advice packages. You can talk one-on-one to a financial expert and get personalized guidance.

There are 2 package tiers to choose from:[4]

  1. Getting Started Package ($299)
    You get one 45-minute call with a licensed financial expert who will help you start your Betterment account. You'll also receive a set of action items to maximize your investments.

  2. Specialized Packages ($399)
    You get one 60-minute phone call with an advisor to review your financial situation and develop an action plan. The 4 available subjects are:

    • Financial Checkup
      Review your current investment strategy.

    • College Planning
      Go over your high education plans, how much you need to save, and which education savings accounts to use for your state.

    • Marriage Planning
      Go over your goals, budgeting, debt, and merging finances.

    • Retirement Planning
      Review your current situation, accounts and holdings, employer plans, and more.

The packages have a 30-day full refund policy if you're unsatisfied with the service you received.

How Betterment Fees Compare

Here's how Betterment's fees compare against other popular robo-advisors.

Vs. Wealthfront:
Wealthfront's annual advisory fee is also 0.25%. But the minimum deposit is $500.[5] It's not a huge amount, but newbies may still like that they can test out Betterment with no minimum requirement.

Wealthfront does not offer a higher tier service. Wealthfront's service is completely automated - there is no access to human advisors.

Vs. Charles Schwab:
Charles Schwab Intelligent Portfolio has no annual fee. However, the opening deposit is $5,000, which may be too steep for many newbie investors.[6]

Charles Schwab also does not offer access to human advisors.

Vs. Vanguard:
Vanguard Personal Advisor's annual fee is 0.30% and it does have a very steep $50,000 opening deposit. The 0.30% fee includes human oversight of your portfolio.

Advisors are on hand to help you make the best decisions for your goals. If you have $50,000 to invest, we think Vanguard offers one of the best services for the cost.

Bottom Line

How much does Betterment charge in fees? Betterment's fee is $4/month for accounts less than $20,000, or 0.25% annual fee for balances of $20,000 or more, or with a recurring monthly deposit of $250 or more. Accounts $100k or more have the option to upgrade to the Premium plan, which costs 0.65% per year and includes access to financial advisors. Accounts over $2M get a 0.10% discount for the portion over $2M.

Betterment provides a good service for those who want to be completely hands-off. It's one of the best options for a robo-advisor with $0 minimum deposit.

The $4 per month or 0.25% annual advisory fee for the basic plan is low and competitive with other robo-advisors.

The 0.65% annual fee for the Premium Plan is also not a bad deal for the ability to talk to financial experts.


  1. ^ Betterment. Pricing, Retrieved 9/29/2022
  2. ^ Betterment. ETF Selection For Portfolio Construction: A Methodology, Retrieved 9/29/2022
  3. ^ Betterment. Am I still charged the whole fee even if I don't use the product for the whole year?, Retrieved 9/29/2022
  4. ^ Betterment. Advice Packages, Retrieved 9/29/2022
  5. ^ Wealthfront. Pricing, Retrieved 9/29/2022
  6. ^ Charles Schwab Pricing, Retrieved 9/29/2022

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