In this Betterment Everyday Savings review, we’ll explain how the account works, explore the best ways to use it, and determine if it is a good fit for your savings needs. Enjoy!
Betterment Everyday Savings is a straightforward way to help you save and reach your financial goals. It boasts one of the top interest rates of any high-yield savings account and gives you more bang for your buck than traditional banking options.
Still, since it’s a relatively new product, you might not be familiar with Betterment’s Everyday savings account. Although the company primarily focuses on robo-advisor investment services, they’re no stranger to helping account holders save their money.
The Betterment Everyday Savings account is an upgrade to the Smart Saver account which was previously offered. With the old account, they put your money into low-risk investments, and your cash wasn’t FDIC-insured. However, they’re transitioning all of their current Smart Saver accounts to the new and improved Everyday Savings, and they’re hitting the ground running.
There’s no risk because your money is now FDIC-insured. They don’t have a minimum balance requirement and you earn up to 2.04% APY on your money!
With interest rates like that, it’s no secret that moving your money to Betterment Everyday is a smart move. After all, why wouldn’t you want to earn more from your money by doing nothing at all?
But first, you should know what you’re getting into. Here’s an in-depth look at what you need to know before opening a new account.
Betterment Everyday Savings at a Glance
- Grow your money with high-interest savings
- FDIC-insured up to $1,000,000
- Internet banking made easy across the U.S.
- Partners with well-known banks to maximize savings
Betterment Everyday Savings: Pros and Cons
|Betterment Everyday Savings: Best Features||Betterment Every Savings: Where They Fall Short|
|Super-high interest rate||Low name recognition|
|FDIC-insured up to $1,000,000||Have to sign up for the Everyday Checking waitlist to earn the maximum rate|
|Unlimited withdrawals||Joint accounts not offered yet|
|Transfers take just 1 to 2 business days|
|No monthly fees|
|Low initial deposit requirement|
Who Is Betterment?
Betterment has been around since 2008 and most people recognize them for their robo-advisor investment services. However, the Everyday Savings account is a recent option and it’s outstanding.
Betterment isn’t a bank, but they are registered with the SEC as an investment adviser. So, can they have a savings account? Good question. Betterment partners with some top-notch banks in the industry to offer an option for a great savings account. As of September 30, 2019, Betterment Everyday Savings program banks include:
- ConnectOne Bank
- Georgia Banking Company
- Seaside National Bank & Trust
- Third Coast Bank SSB
- Valley National Bank
- Wells Fargo Bank, N.A.
Even though Betterment partners with these banks to provide you with a first-rate savings account, you never have to deal with any of them yourself. Betterment takes care of all of that on the backend so you can focus on your money. Plus, your deposits are FDIC-insured up to $1,000,000 which is above and beyond the typical $250,000 you see at a single bank.
To take their banking offerings to the next level, they plan to release a fee-free checking account soon. Sign up for the waitlist to get notified when it becomes available.
Betterment Everyday Savings Highlights
The new Everyday Savings account from Betterment has no fees on your account balance and offers superior interest rates up to 2.04% APY. New accounts can be opened with a $10 minimum deposit.
If you’re struggling to save, knowing your cash can earn more interest is an incentive to step it up a notch. Just $5,000 in the account will earn almost $120 of interest in a year, which is basically $120 in free money.
There’s just one catch: You must sign up for the yet-to-be-released Everyday Checking waitlist to cash in on the higher interest of 2.04% APY. If you don’t want to, that’s okay. Your money still earns 1.79% APY, which is a significant advantage over many other accounts you’ll find.
Even better, unlike other high-yield savings accounts, the Everyday Savings account offers unlimited withdrawals.
At most banks, federal law doesn’t let you make more than six withdrawals per month on a savings account. However, the structure of the Everyday Savings account is different, so it doesn’t fall under the six withdrawal rule.
That means you can transfer money in and out of the account as many times as you want without worrying about penalties or paying extra fees. Though keep in mind you want to save money, not spend it.
Adding money is easy when you link a bank account to your Betterment account. Once your money is there, it’s protected by the FDIC for up to $1,000,000. This is an important consideration because the previous Betterment Smart Saver accounts weren’t FDIC-insured. They were investment accounts, not savings accounts.
Betterment’s Everyday Savings is a true savings account. Your cash isn’t invested but can still grow as it earns interest. Since it’s FDIC-insured, there’s no risk at all to keep your savings at Betterment.
How to Use a Betterment Everyday Savings Account
Everyone has different money needs, and Betterment Everyday Savings is extremely flexible. With no restrictions on how often you can transfer money back and forth, the account has unlimited potential.
Vacation Fund – Taking out a loan to pay for your vacation or putting it on your credit card is never a good idea. Instead, set up a separate account to reach your travel goals. You’ll be free to enjoy a fantastic escape without the guilt of creating more debt.
Emergency Fund – Keeping your emergency fund in a separate account is a smart choice whether you’re still building it or already have the recommended 3 to 6 months’ worth of living expenses. By keeping the money separate, you aren’t tempted to spend it on things it wasn’t meant for.
Down Payment – Buying a house or a car? Those don’t come cheap. Have a special place to stash your money when saving for a down payment. Your cash will grow faster with the higher interest rate, too.
Big Purchases – Savings accounts are the perfect way to save for big purchases. If you’ve got your eye on a boat or are thinking of splurging on new furniture, set aside a little cash each week to make your dreams a reality.
Benefits of Using Betterment Everyday Savings
- Excellent Interest Rate – Betterment Everyday Savings pays the same interest no matter how much (or how little) money you have in your account. You earn 2.04% APY on all balances when you sign up to be on the waitlist for the upcoming Everyday Checking account. Otherwise, you’ll earn 1.79%, which is still substantially more than the national average.
- Unlimited Withdrawals – Most savings accounts let you take out money a maximum of 6 times per statement cycle, but you don’t have to worry about that with this account. With Betterment, there’s no limit to how many transfers you make.
- Low Initial Deposit Requirement – Betterment Everyday Savings helps you make the most of your money, and you only need a minimum deposit of $10 to build your savings.
- No Fees – There are no fees on your account balance and no minimum balance to maintain.
- FDIC-insured – Any money you put into your Everyday Savings is covered up to $1,000,000 in FDIC insurance.
Where Betterment Everyday Savings Falls Short
With no fees, unlimited withdrawals, and the high interest rate, Betterment Everyday Savings is tough to beat. Nothing in life is perfect, however, and there are a few spots where Betterment Everyday could improve.
The most obvious downside is the low name recognition. Betterment got its start as an investing platform and is branching out to offer more products. If you’re not into investing, there’s a good chance you’ve never heard of Betterment.
Still, their Everyday Savings is a stellar product. As word spreads, the company will give bigger banks a run for their money.
Earning a whopping 2.04% APY rate on your savings is a huge draw of this account. Unfortunately, you might not realize that you have to sign up for the waitlist for their upcoming Everyday Checking account to get that rate.
If you don’t, you’ll earn a lower amount of 1.79%. It’s still a good return on your money, but it isn’t as high as it could be.
Is Betterment Everyday Savings Right for You?
Online banking has a lot of benefits over brick and mortar banks including lower fees and higher interest rates. Still, some people prefer to do their banking in person. If that sounds like you, Betterment Everyday Savings might not be a good fit.
However, having an online account is easy to set up and to manage. Betterment Everyday Savings streamlines the process even further by allowing unlimited transfers in and out of the account.
If you’re on the fence, consider giving online banking a shot.
An Everyday Savings account is a great place to store your emergency fund. It’s also a good place to stash cash for your vacation fund or other savings goals. As a bonus, you’ll earn a great interest rate with no extra work or risk.
How to Open the Everyday Savings Account
Betterment makes opening an Everyday Savings account easy. You only need a few minutes to get it set up. Before you start, it’ll be helpful if you have your driver’s license and Social Security number close by.
- Open an Everyday Savings account here.
- Opt to join the waitlist for the Everyday Checking account to boost your interest from 1.79% APY to 2.04%.
- Enter your email address and pick a password, then fill in your personal information.
- Connect an existing bank account to deposit at least $10 to your new account.
Frequently Asked Questions
No. Betterment is an investment firm registered with the SEC. Money deposited into Betterment Everyday Savings is held at partner banks.
Yes. Because Betterment Everyday Savings spreads your deposit between multiple banking partners, your deposits are insured by the FDIC for up to $1 million.
To open a Betterment Every Savings account, a minimum deposit of just $10 is required.
No. There are no minimum balance requirements and fees are not charged on your balance.
Although savings accounts at traditional banks limit you to six transactions per month, Betterment Everyday Savings provides unlimited withdrawals.
Betterment Everyday Savings Review: The Bottom Line
With a super-low opening deposit of $10, anyone can take advantage of what Betterment Everyday Savings has to offer. The biggest benefit is the 2.04% APY that’s available when you sign up for the soon-to-be-released Everyday Checking waitlist.
Keep in mind there’s no obligation to open an Everyday Checking account. You can still get a good rate without signing up for the waitlist, though you may want to look around for a higher rate. Although, it might still be worth considering Betterment, as their checking account promises no account fees, overdraft fees, or minimum balance requirements. That’s hard to beat.
Even if you stick to the Everyday Savings account, you still come out ahead. You can move your emergency fund there to earn more interest right away. When you’re ready, adding money for your vacation fund or other financial goals is easy to do with the click of a button.