In the evolving financial landscape, many investors are seeking increased control over their investment strategies. A recent survey revealed that an impressive 75% of Betterment customers engage in some form of self-directed investing. This statistic underscores a growing trend among individuals who prefer to manage aspects of their investment portfolios independently, despite the convenience of automated solutions.
Betterment recognizes this desire for autonomy and has enhanced its platform to facilitate self-directed investing.
This approach combines user-friendly technology with comprehensive investment options, allowing investors to buy and sell a wide array of stocks and ETFs without incurring commission fees.
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Benefits of self-directed investing
One of the primary advantages of Betterment’s self-directed investing feature is the flexibility it offers. Investors can make choices that reflect their personal beliefs and interests. For instance, some individuals prefer to invest in companies that align with their values, while others may find satisfaction in actively managing their investments and tracking market trends.
By using Betterment, investors can manage both automated portfolios and self-directed trades from a single platform. This integration provides a cohesive view of their financial situation, making it easier to balance investment strategies. With a clear interface, Betterment empowers investors to take charge of their financial futures.
Tax implications made simple
While self-directed investing offers greater control, it also presents challenges, particularly concerning taxes. Many investors are often surprised by the tax consequences that arise from frequent trading. Discussions with users reveal that a common concern regarding self-directed investing on other platforms is managing tax implications.
To address this issue, Betterment includes a tax impact preview feature before finalizing any sale of stocks or ETFs. This tool provides insights into how a transaction might influence the investor’s tax situation, including potential wash sales, which occur when a security is sold at a loss and repurchased within 30 days. This proactive approach allows investors to make informed decisions without unexpected surprises during tax season.
Getting started with self-directed investing
For those ready to explore self-directed investing through Betterment, here are three essential steps to embark on the journey:
Step 1: Create your account
The first step involves creating an account on the Betterment platform. This process is straightforward and user-friendly, allowing investors to set up their investment profile and preferences efficiently.
Step 2: Explore your options
Once the account is established, investors should take time to explore the various investment choices available. Betterment offers a diverse selection of stocks and ETFs, enabling individuals to tailor their portfolios according to financial goals and personal interests.
Step 3: Monitor and adjust
Finally, investors should actively monitor their investments and make adjustments as needed. The platform provides tools to help track performance and assess whether the investment strategy aligns with objectives. This ongoing evaluation is crucial to successful self-directed investing.
Betterment recognizes this desire for autonomy and has enhanced its platform to facilitate self-directed investing. This approach combines user-friendly technology with comprehensive investment options, allowing investors to buy and sell a wide array of stocks and ETFs without incurring commission fees.0
