In the realm of investing, safety is paramount. Understanding how your chosen platform protects your assets allows you to engage in investing with greater confidence. At Betterment, we employ a variety of sophisticated security measures designed to shield both your account and your investments from potential threats. Below, we outline the essential ways in which we ensure your information remains secure and your investments protected.
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Account protection strategies
To safeguard your Betterment account, we implement several proactive measures, including two-factor authentication (2FA).
This process acts as an additional security barrier, requiring not only your standard password but also a secondary verification method, such as a code sent to your mobile device. This means that even if an unauthorized individual obtains your password, they would still be unable to access your account without this crucial second step.
Encryption for data security
Every interaction you have with Betterment, whether through our website or mobile application, is protected by encryption. This technology scrambles your data, ensuring that any information exchanged between your device and our servers is unreadable to potential eavesdroppers. This measure reinforces the integrity of your personal data, making it exceedingly challenging for malicious actors to gain access.
Password hashing to guard your credentials
When you create a password for your Betterment account, it undergoes a process called hashing. This method transforms your password into a unique string, which is stored securely. Consequently, even if our systems were compromised, your actual password remains concealed and unusable by unauthorized personnel.
Investment security measures
In addition to account protection, we also focus on securing your investments. One way we ensure this is through clear visibility of your holdings. Our commitment to transparency means you can easily verify that all your investments are accurately represented. You’ll find detailed records of trades made on your behalf, including the number of shares and the specifics of fractional shares sold, as well as their financial implications.
Independent audits for peace of mind
Betterment undergoes regular evaluations by independent auditors. These professionals meticulously reconcile every dollar and share we report with our actual holdings. Their rigorous checks often include random account audits, confirming that the statements provided to customers align with our internal records. If any discrepancies arise, they are promptly addressed.
Separation of funds for additional security
Another critical aspect of our security practices involves the segregation of funds. Your investments are maintained separately from Betterment’s operational funds. This means that in the unlikely scenario of financial difficulties within our company, your assets remain untouched and secure.
Furthermore, your Betterment investments benefit from SIPC insurance, which provides coverage up to $500,000 per customer, including a limit of $250,000 for cash claims. While this insurance does not guard against market fluctuations, it serves as a safety net in the event of brokerage failure, adding an extra layer of security to your financial journey.
How you can contribute to your security
While we take extensive measures to protect your account and investments, you also play a vital role in maintaining security. Always be vigilant for suspicious communications, such as unexpected calls, emails, or texts that may contain phishing attempts. Remember, Betterment will never ask for your password or 2FA code outside of a secure login process or when changing personal information in our app.
Choosing a strong, unique password for your Betterment account is essential. If you ever receive unexpected or questionable messages, or if you have concerns about security, please reach out to us at [email protected]. Together, we can ensure that your investing experience is both secure and rewarding.
