Betterment Announces New 401(k) Offering for Employers

Largest Robo-Advisor Enters the $5.5 Trillion Defined Contribution Market

News provided by

Sep 11, 2015, 10:30 ET

NEW YORK, Sept. 11, 2015 /PRNewswire/ -- Betterment, the largest automated investing service, today announced the upcoming launch of Betterment for Business. The new 401(k) platform will use smarter technology to offer personalized investment advice for all participants. For plan sponsors, it will provide streamlined administration and fiduciary support. It will launch in Q1 2016.

"Based on our findings, Betterment for Business is the only full-stack, bundled 401(k) provider to launch in the last three decades—virtually since ERISA laid the groundwork for 401(k)s in the marketplace," said Jon Stein, Betterment's CEO and Founder. As such, Betterment's technology and user experience advantages over incumbents leave it well positioned to provide a best-in-class experience for plan sponsors and participants.

Plan administrators will have automated, easy-to-use tools and, importantly, peace of mind—so they can worry about their day-to-day responsibilities instead of whether their 401(k) is compliant. Plan participants will be more prepared for retirement and empowered to achieve better investment outcomes with personalized investment advice across all of their assets.

Employers will be able to enroll new participants through a seamless, paperless onboarding process. The employer dashboard will enable companies to easily administer plans and assist them in meeting their fiduciary and regulatory compliance responsibilities.

"Current 401(k) offerings—and we have examined them all—have poor user experiences, high costs, and a clear lack of advice. Not anymore. Betterment for Business will bring our smarter technology to the workplace and the millions of Americans who badly need it to meet their retirement needs," Stein added. "It's time that all Americans have low-cost, unconflicted advice and smarter technology for retirement planning."

Earnest, a San Francisco-based lending startup, has signed on as a charter customer. "At Earnest, we pride ourselves on providing our employees with important ways to promote financial health and responsibility as part of our benefits package," said Louis Beryl, CEO and Founder of Earnest. "We've offered 401(k) options to employees since early stages in our company development and are excited to grow into a smarter offering from a respected and philosophically aligned innovator like Betterment."

Participants enrolled on the platform will receive a globally diversified portfolio of index-tracking exchange-traded funds (ETFs) with personalized advice in a goal-based investing framework that currently serves more than 100,000 retail customers. Participants will also be able to easily open and customize taxable investment accounts, traditional and Roth IRAs, and trust accounts—and view all side-by-side with their 401(k) accounts. The accounts will be intelligently tax-managed, together—a service that no other provider in the market provides.

Earlier this year, Betterment announced a partnership with the Social Security Administration in order to integrate participants' Social Security benefits into their retirement planning.

Consistent with Betterment's retail service, Betterment for Business aims to lower costs and offers a simple, easy-to-understand fee structure, with no upfront fee for plan sponsors with more than $1 million in assets, and an assets under management-based fee ranging from 10 to 60bps.

Launched in 2010, Betterment manages more than $2.6 billion in assets and has continued to add new features and improve its industry-leading service. In the past year alone, Betterment has released a suite of tax-efficient features, including Tax Loss Harvesting+ and Tax Impact Preview to all of its customers, regardless of balance. Betterment also recently released RetireGuide™, an advice engine that helps to inform customers as to whether or not they are invested correctly for a comfortable retirement, and SmartDeposit, a feature that makes it easy for customers to automatically invest their excess cash without having to think about it.

To request more information on Betterment for Business, please visit www.bettermentforbusiness.com

Contact Info:

Joe Ziemer, [email protected], 212-228-1328

Arielle Sobel, [email protected], 347-395-0258

Betterment is the largest, fastest-growing automated investing service, helping people to better manage, protect, and grow their wealth through smarter technology. With more than 100,000 customers and over $2.6 billion in assets under management, the service offers a globally diversified portfolio of ETFs, designed to help provide you with the best possible expected returns for retirement planning, building wealth, and other savings goals. Betterment also helps customers get on track for a comfortable retirement with RetireGuide™, a retirement planning tool that lets people know how much they should save and if they are investing correctly.

Betterment is a CNBC Disruptor 50, FT 300 and Webby award winner, and it has been featured in the New York Times, Forbes, and the Wall Street Journal. Betterment helps people to achieve a smarter financial future with minimal effort and for a fraction of the cost of traditional financial services. Learn more here.

Determination of fastest growing automated investment service reflects Betterment LLC's distinction of obtaining the largest number of new accounts since January 1, 2014, based on Betterment's review of account numbers self-reported in the SEC's Form ADV, across Betterment's survey of automated investing services, as of January 31, 2015.

Logo - http://photos.prnewswire.com/prnh/20150910/265526LOGO

SOURCE Betterment