Stash Vs Betterment (Pros & Cons Of Each)

I've been investing with both of these apps for about two years now and they are very very different So if you're looking for guidance on which one to go with you're in the right place So keep watching for a detailed honest review. What is up everyone? I'm rose and welcome back to my channel My channel is all about stock investing for beginners So if you're new here, feel free to subscribe and hit the notification bell for new videos like this every week in this video I'll compare betterment versus stash in terms of investment approach or how your money gets invested also in terms of safety and a discussion of the risks involved cost and Finally of funding options and account types offered. So let's get started before signing up for any investing app. It's important to understand How is your money going to get invested staff and betterment have very different approaches to investing? So let's talk about that Stash is a platform that simplifies investing for the everyday person So what's cool about this app is that they completely eliminate typical financial jargon on their interface For example when you're scrolling through the list of investments on the stash interface You'll see that everything is in really easy to understand language this small but mighty ETF if you click into that you'll see that it's actually an ETF that gives you exposure to a bunch of companies that have small Capitalizations now if you're a beginner, if you saw an investment called small cap companies, you're not gonna know what that is So that's kind of the good thing about stash is that they list everything in terms of everyday language that anyone can understand This is cool Because for most people what they say is what is most intimidating about getting started investing is navigating through a bunch of financial Jargon, so stash completely takes out all this intimidating technical language to make choosing investments as easy as possible for you Now the thing with stash is that it's totally up to you to do your own research And pick what stocks you want to buy on the other hand betterment will create a portfolio for you For example, here's my betterment portfolio. They created this for me based on basic inputs my my timeline the target amount and Etc. So my money is invested in all these ETS and I'm actually not the one picked them versus ATS – my money is invested in just two ETS that I've picked the women who lead and the do the right thing fund and You know It was kind of like shopping in a grocery store and I was just picking what ETF's I wanted in my stash portfolio Investing at stash is like having someone hand you an empty grocery basket and they tell you here Just put whatever you want in it and then investing at betterment is like having someone who's very knowledgeable And qualified just hand you a ready-made basket that has a bunch of goodies already in it Do you want to pick your own investments or do you want someone to do it for you? It's definitely more fun to choose your own stocks the way you can do on stash But that also means you have to do your research and you have to know what you're doing I could easily see someone who doesn't know what they're doing Just kind of put all their money into stocks and then they're hoping they'll have enough in there to buy a house in five years But the thing is if you need to cash out on your investments in five years You should have most of your money invested in bonds not stocks So there needs to be a lot of intent Intentionality and thought behind how you invest your money and the average person doesn't know how to do this So that's where a betterment wins over stash for beginners You don't know what factors to consider when choosing your own investments so letting betterment create the portfolio for you is better than shooting in the dark and trying to figure it out on your own other things you'd Need to consider as an investor is things like taxes, you know short-term versus long-term capital gains so that should factor into when you buy and sell and this is all stuff that you wouldn't necessarily know how to do if you're just Starting out betterment will take care of all those things for you. They do something called thrift loss harvesting So they'll only buy and sell investments in a way that is That makes sense for your tax situation to minimize your tax bill now with stash. They're not gonna do any of that so if you don't You know know about the tax considerations you should have as an investor Then I think betterment would be better for you get it betterment better now Let's talk about safety and some of the risks involved with each app They're both registered with the SEC Which means that both betterment and stash are legit and they can't lie and cheat you they're also insured by the S IPC which means that even if the but he goes bankrupt you'll get your money back because they have insurance These are basic requirements for any investing app So I'm happy to say that both stache and betterment are covered in that sense But I also want to make a comment about investing risk as with any type of investing There's no guarantees that you'll make money all investing involves a risk of loss But the question is do know what you're doing over time informed investors make money so You know stash and betterment are no different in that regard Whether you make or lose money will depend on how good of an investor you are So if you make an investment just because you feel like it and then you sell it when you get scared Then you're probably gonna lose money So regardless of whether you go with stash or betterment, what's risky or not? depends ultimately on you and how you use the app now for a quick comparison of cost betterment charges an annual percentage fee of 0.25 percent and stash charges a monthly fat flat fee fab fee $1. So if you had say 1,000 dollars to invest then betterment would charge you an annual fee of $2.50 and then at stash you'd pay a $1 a month or annual fee of $12 a 12 dollar fee on $1,000 is 1.2 percent. Annually, that's almost five times more than betterment You also have to keep in mind the level of service that you're paying for So stache doesn't really do anything other than presenting investments to you in easy-to-understand language They do have a lot of in-app education and articles to help you learn But they're not really doing any investment management for you you know with betterment you're getting full service advice and 24/7 portfolio management and they're buying and selling and you know adjusting your portfolio at all hours of the day So you definitely get a much higher level of service and I think more bang for your buck at betterment and finally Let's talk about funding options and account types offered by each app – offers roundups So that's a really cool funding option where you can invest with your spare change by rounding up your debit card and even your credit card purchases Betterment on the ot