Like a Ronco rotisserie oven, retirement accounts are now something that investors can "set and forget."
In the latest example of this trend, New York-based robo-advisor Betterment on Tuesday unveiled SmartDeposit, a new automatic investment deposit tool.
SmartDeposit automatically checks customers’ bank account balances and determines when it’s appropriate to invest.
“We aim to automate the investing process here at Betterment and with SmartDeposit we enable customers to reach their financial goals without worrying or thinking about their finances,” said Dan Egan, Betterment’s director of behavioral finance and investing. “Our goal is to continue to automate in areas where we know customers benefit.”
The new tool transfers money from a customer’s bank account into Betterment if their balance is above a set, customizable threshold.
The excess cash is removed and placed into a globally diversified portfolio of ETFs that is customized to each client’s needs.
The tool automatically accesses customer’s account balances at least once per week and notifies them before each transfer. Customers must set an account threshold of at least $1,000 to avoid potential overdrafts.
Customers can access money from their Betterment account at any time, but they are responsible for any tax implications incurred through withdrawals. When faced with major expenses or life changes, customers can cancel or adjust their SmartDeposit settings.
The SmartDeposit tool currently works with accounts from 11 different banks, and Betterment says it is working to add more to their platform.