Betterment is joining WealthFront in the race of robo-advisers who want to provide full banking services for their clients.
The New York-based robo has kicked off a series of new services, including a savings account with an APY rate of 2.69% (2.42% for money deposited after this year). Additionally, Betterment has launched a checking account that does away with traditional costs like maintenance fees and overdraft penalties.
Betterment and Wealthfront have a history of going after one another directly. As reported by FinancialPlanning, WealthFront spokeswoman Kate Wauck said in a statement that, “‘It’s disappointing to see Betterement play a bait-and-switch game that you’d expect from the traditional industry – offering a short term promotional rate to lure new customers in.'”
Joe Ziemer, VP of communications at Betterment shot back that, “‘It seems implausible that a company would claim any sort of moral high ground while at the same time forcing customers into a heavily conflicted, proprietary product.'”
Ziemer is referring to Wealthfront’s risk parity fund, which customers are automatically enrolled in if they carry more than $100,000 AUM, unless they opt out.
Many financial institutions are now offering both investing and banking services, offering a one-stop-shop for customers. Is your advisery firm joining the race to become a “full-service” financial institution?
