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Edit: technically they lowered fees for <$10k and raised fees for >$100k

• madcaptenor 10y ago
  Also, they're charging no fees above $2M. Since the old fee on accounts over $100k was 0.15%, and the new fee (for the "digital" tier) is 0.25%, this means that they're lowering fees on accounts above (0.25%/0.15%)*$2M = $3.33M. Is Betterment trying to get into this high-net-worth space? They can't have too many customers right now, given that their average account size is $29K. (https://www.fastcompany.com/3067717/new-money/betterment-adds-human-advisors-casting-doubt-on-pure-play-robo-investment-models https://www.fastcompany.com/3067717/new-money/betterment-add...)
  • tedmiston 10y ago
    I thought the $2M was a weird magic number. I'm curious if there's a deeper significance to choosing that.
    • rbcgerard 10y ago
      My guess is that they basically want to have a flat fee but don't want to discourage a big account, if you figure that if you retire in your mid 60s, you probably need 8x-13x your annual income in retirement savings, $2m would cover the bulk of the market... also, $2m is the area where you start competing with the lower end of the high net worth wealth management market...