Digital innovations in technology keep on evolving, even in the financial world. Growing up when computers became a thing, millennials find it easy to adapt and understand new technology; millennials aren’t fazed with innovation and are used to it. This is why Betterment is being received well by Millennials.
What is Betterment?
Betterment is a kind of investment platform that’s fully automated. In this platform, investors are offered many features. Included in these features are financial advisors that can help you with your decisions regarding your investments. Even better, Betterment is already an SEC (Securities and Exchange Commission) registered investment adviser.
Betterment is a digital adviser on investments and uses algorithms to decide where it’s best to invest the client’s money. Some people call this a robo-advisor, too.
As times change, more and more millennials are warming up to the idea of digital services with regards to investments.
Why Are Millennials Investing with Betterment?
Now that you know what Betterment is, here are some reasons why millennials are starting to invest with it:
1. Protection, Insurance, and Security
According to this review on InvestmentZen, Betterment is very reliable and secure.
When investing in something, millennials want to make sure that their funds are well-protected. As mentioned above, with Betterment, the funds are secured under the Securities Investors Protection Corporation (SIPC) up to an amount of $500,000 in securities and $250,000 in cash.
If your broker makes a mistake along the way, you’re protected. However, just like other kinds of investments, this protection does not cover losses that are borne out of market fluctuations. You are responsible to track market fluctuations, do your research, and make judgments out of the information you hold.
2. Perspective and Behavior
To understand why millennials are investing with Betterment, you have to understand the underlying core insight. Remember that millennials grew up with technology and multiple financial crises. Since banks and investment houses were one of the prime reasons for the financial crisis, all these financial crises contributed to the growing distrust of the millennials towards banks and financial institutions.
Growing up with technology, millennials are accustomed to apps and anything digital, unlike the latter generation. Thus, millennials are more likely to trust digital banking as compared to the brick and mortar traditional bank.
3. Personalized Advice
One of the reasons why millennials are starting to invest with Betterment is because they can get personalized financial advice from it. You can input your financial behavior and preferences. Then, an algorithm will compute and assess the ways you can invest.
You can even input a specific goal, and the algorithm will show you steps on how to achieve it. When you input your investment goals, you can include a time horizon, schedule for deposits, and portfolio allocation. The system can figure out how much you need to invest on a regular basis and which investment tools to use to reach your goals.
4. Retirement Planning
Millennials are very forward-looking. Therefore, planning for retirement is something that they already think about. Betterment already offers a tool that’ll help them with retirement planning. The system will give you some advice and help you achieve the goals you set for retirement.
With this feature, you’re also allowed to add in factors including tax, social security income, and pension plans. This will help you personalize your retirement plan. By doing this, you’ll be able to get a more accurate plan to achieve your financial goals once you hit retirement.
5. Convenience and Saving Time
When you’re always on the go, time and convenience are very valuable. This is what Betterment provides for you.
First of all, you use all the features on a mobile app, which is available for both iOS and Android. So, even though you’re not at home, you can access and use the services from Betterment from anywhere you are.
On the other hand, Betterment also offers customer service that’s contactable using various channels. If anything goes wrong, you can be assured that it’ll get solved immediately. Betterment’s customer service is available to contact via email, phone, or live chat from Mondays to Fridays from 9 AM to 8PM on weekdays and Saturdays to Sundays on weekends from 11 AM to 6 PM.
The future of the financial world lies in technology and innovation. These are just some of the reasons why millennials are starting to invest with Betterment.
With millennials embracing robo-advisers and digital banks, this shift of behavior is what everyone should get on.