Are you new to investing? Don’t worry, this app will do all the work for you — and it could earn you 38% more money over time. This was originally published on The Penny Hoarder, which helps millions of...
What do you really want? What are your actual financial goals?
A better car? A post-pandemic dream vacation? An emergency fund? A healthy college fund for the kid? A comfortable retirement?
To reach your goals, you’re probably going to need to invest. That’s by far the best way to grow your money. Because just sticking your cash in a savings account won’t do much for you anymore. These days, you’ll likely earn practically zero interest on your savings that way.
Now, what’s the best way for you to get started investing?
If you’re new at this — or even if you’re not — you should look into an investing platform called Betterment. Over the long term, and by following Betterment’s recommended investment advice and using their automated features, their investing technology could help you earn an estimated 38% more than the typical investor.
How Betterment Could Help You Earn About 38% More as an Investor
Launched in 2010, Betterment is considered the pioneer of robo-investing. Today, it has half a million users, and it manages more than $20 billion in assets.
It’s easy to use; it has low fees; and it does all kinds of important and tricky work for you.
How does it work? Here are the basics:
First, answer some quick questions about your age and income and when you hope to retire. Based on your answers, Betterment will recommend a portfolio of low-cost index funds that track the stock market as a whole.
You can set up auto-deposits to steadily feed your investments.
New to investing? You can start slow, if you want. A lot of investing apps require you to keep $1,000 in your account at all times. With Betterment, there’s no minimum account balance and you just need a $10 initial deposit to start.
Plus, this is an affordable way to invest. Betterment charges an annual management fee of 0.25% of your investments. For example, if you invest $1,000, you pay them $2.50 a year to manage it. That’s a fraction of what traditional investment advisors charge.
How does Betterment do this? It uses sophisticated technology to steer your investments. Their platform is built for long-term investors who want a professionally managed portfolio at a low fee.
Helping You Reach Your Financial Goals Faster
Over time, investing in the stock market will earn you an average annual return of 7%, adjusted for inflation, according to authorities, such as the U.S. Securities and Exchange Commission.**
Betterment says it has ways of beating the average, though. The company’s algorithms automatically do all kinds of investing strategies, like tax loss harvesting at the flip of a switch and rebalancing your portfolio when it gets out of whack.
Don’t know what any of that means? You don’t have to. This is a “set it and forget it” strategy, and we mean that in the best possible way. You get the ball rolling and then let Betterment do its work.
If you follow Betterment’s recommendations, you could increase annual returns by an estimated 1.48%, the company says. Over the long term, that makes a huge difference. If you’re investing for retirement and you follow Betterment’s recommendations for 30 years, you could have an estimated 38% more after-tax money in retirement compared to investing on your own.
Imagine having about 38% more money when it’s time to retire. Imagine what a difference that could make.
Of course, you can invest for other goals besides just retirement. And here’s why Betterment shines.
When you sign up for a Betterment account, it’ll suggest some goals based on your answers. For example, maybe you’ll want an emergency fund that could pay your bills for several months in a pinch.
You can add your own personal goals, too, and Betterment can help you invest to achieve them.
Get started here. It takes just a few minutes, and you could be on your way to hitting your goals.
Mike Brassfield (mike@thepennyhoarder.com) is a senior writer at The Penny Hoarder. You better believe he invests.
**The long-term return of the stock market, as measured by the S&P 500 index from 1957 to 2018, is about 7.96%.
Investing involves risk. Performance not guaranteed.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
