Betterment Brokerage vs Vanguard Investment Funds

[PFHC]

Here's me:

• 35, aiming for FI by 42
• maxing my 401k
• putting $3000/yr into an IRA
• paying down my mortgage like a man possessed (don't yell at me, it's a personal decision, and I'm sticking with it)
• looking for a place to $3000/mo. The stipulations are this
• • I would like around $10,000 to be semi-liquid, i.e. something that could easily fund my credit card backed "emergency fun" in the case of said emergency.
  • I need it to be a taxable account in order to gtfo to FItown, USA at age 42.

I currently pour it into a Betterment brokerage account, but everyone here is all about Vanguard. What would you all suggest. Pros/cons, etc. Should I keep the semi-liquid $10k in one and my gtfo money in another?

Pardon my ignorance... I'm just a grease-monkey that is new to all this shit.

Thanks in advance!

[ROY2007]

This has been discussed at length on the forums do a quick search and you'll find what you're looking for.

[EricP]

I need it to be a taxable account in order to gtfo to FItown, USA at age 42.

There are numerous strategies in order to access money before 59.5 so there is no reason to insist on it being a taxable account when you still have tax sheltered space available.  Go ahead and finish up the IRA before you start putting money into taxable accounts.

[Jeremy E.]

You could finish your IRA contributions with $2,500 in a Roth IRA first, all of the contributions are very liquid. After that you can put it in Vanguard, Betterment or pay off your mortgage. I don't think any of those options are bad, and either way it sounds like your on a quick path to FI, Good Luck! Below are some articles that might help your decision making.

Here are some posts about Betterment,
http://www.madfientist.com/moving-my-money-to-betterment/
http://www.mrmoneymustache.com/2014/11/04/why-i-put-my-last-100000-into-betterment/
http://jlcollinsnh.com/2013/12/16/betterment-wants-to-give-you-25/

However, here is a post of why I choose Vanguard over Betterment
http://jlcollinsnh.com/2012/09/07/stocks-part-x-what-if-vanguard-gets-nuked/

[Digital Dogma]

I had my "semi-liquid" emergency fund in an ING no fee interest bearing checking account. ING was purchased by "capital one 360" since then. Im removing my money from that account due to my negative view of capital one as a company, however it does offer a small interest so I would recommend you take a look to consider that option.

[johnny847]

The value of betterment is automated tax loss harvesting. The cost is an extra 0.15% expense ratio. This is on top of the expenses of the underlying funds (all Vanguard funds)

But the problem is tax loss harvesting is only an appreciable return, in terms of a percentage of your entire portfolio, in your portfolio's beginning years. If you make regular contributions over years, then so long as the market goes up on average as we expect it to in the long run, then a large portion of your portfolio's value will come from your oldest shares. These oldest shares will have large unrealized capital gains that can never be tax loss harvested (unless we're talking 1929 level market crashes).
Whereas betterment will charge a percentage of your portfolio every single year. See the problem?

[PFHC]

The value of betterment is automated tax loss harvesting. The cost is an extra 0.15% expense ratio. This is on top of the expenses of the underlying funds (all Vanguard funds)

But the problem is tax loss harvesting is only an appreciable return, in terms of a percentage of your entire portfolio, in your portfolio's beginning years. If you make regular contributions over years, then so long as the market goes up on average as we expect it to in the long run, then a large portion of your portfolio's value will come from your oldest shares. These oldest shares will have large unrealized capital gains that can never be tax loss harvested (unless we're talking 1929 level market crashes).
Whereas betterment will charge a percentage of your portfolio every single year. See the problem?

I do see the problem for the long term. Would you see any downside to using it as a sort of savings account, one that would be used to fund the emergency credit and you could withdraw from to do home renovations, for example?

[PFHC]

You could finish your IRA contributions with $2,500 in a Roth IRA first, all of the contributions are very liquid. After that you can put it in Vanguard, Betterment or pay off your mortgage. I don't think any of those options are bad, and either way it sounds like your on a quick path to FI, Good Luck! Below are some articles that might help your decision making.

Here are some posts about Betterment,
http://www.madfientist.com/moving-my-money-to-betterment/
http://www.mrmoneymustache.com/2014/11/04/why-i-put-my-last-100000-into-betterment/
http://jlcollinsnh.com/2013/12/16/betterment-wants-to-give-you-25/

However, here is a post of why I choose Vanguard over Betterment
http://jlcollinsnh.com/2012/09/07/stocks-part-x-what-if-vanguard-gets-nuked/

My concern with the Roth is that I am often in the highest tax bracket so I am screwing myself out of quite a bit by putting my money there now, whereas with the tax deferred, I will be at the lowest tax bracket when I begin to withdraw (<$40k).

What is the particular advantage your referencing of contributing to the Roth? Just the liquidity?

[milesdividendmd]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

[PFHC]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

Great articles, thanks!

I looked into backdoor Roths a few months ago and, like your article mentions, it was not good idea due to having a sizeable traditional IRA already funded. I would have had to pay taxes on the conversion, which made it a wash.

HSA gives me pause due to the fact that, a.) I spend about $5/yr at the doctor, b.) I don't plan for that to change, and c.) I need a fund that I can withdraw from early. Waiting until 65 does not fit that bill.

Thanks for the leads, but I think my best option is going to be a tradition IRA, then use substantially equal periodic payments (I'll call them SEPP, 'cause lots of words) withdrawals along with taxable accounts to fund my life.

Thoughts on the SEPP? How much can I expect to withdraw? With a worse case anticipated $40k/yr COL, will I be able to fund that?

[PFHC]

I need it to be a taxable account in order to gtfo to FItown, USA at age 42.

There are numerous strategies in order to access money before 59.5 so there is no reason to insist on it being a taxable account when you still have tax sheltered space available.  Go ahead and finish up the IRA before you start putting money into taxable accounts.

I looked into this. Are you referring to the various methods are receiving substantially equal periodic payments (I'll call 'em SEPP)? Or are there other avenues? I hate to be bothersome, but I have been searching the web, and the info is not abundantly clear to this plebeian.

Additionally, in my tax-free accounts, I have room for $8,500. Any suggestions on what do I do with the other $27,500? Vanguard mutuals/ETFs?

Blow it on a sick motorcycle? ;)

[milesdividendmd]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

Great articles, thanks!

I looked into backdoor Roths a few months ago and, like your article mentions, it was not good idea due to having a sizeable traditional IRA already funded. I would have had to pay taxes on the conversion, which made it a wash.

HSA gives me pause due to the fact that, a.) I spend about $5/yr at the doctor, b.) I don't plan for that to change, and c.) I need a fund that I can withdraw from early. Waiting until 65 does not fit that bill.

Thanks for the leads, but I think my best option is going to be a tradition IRA, then use substantially equal periodic payments (I'll call them SEPP, 'cause lots of words) withdrawals along with taxable accounts to fund my life.

Thoughts on the SEPP? How much can I expect to withdraw? With a worse case anticipated $40k/yr COL, will I be able to fund that?

Not having medical bills is great, and is in no way a barrier to using an HSA as a stealth Roth. In fact any bills you do have should be paid for with cash in order to maximize tax free growth and withdrawals. Also, odds are someone in your family will have health bills sooner or later.

Also, Don't shut the door on the backdoor just yet. You should check if you can roll over your IRA into your 401k. If so, no pro-rata rule.

This also opens up the door to the Roth ladder, which I like better than the SEPP method.

http://jlcollinsnh.com/2013/12/05/stocks-part-xx-early-retirement-withdrawal-strategies-and-roth-conversion-ladders-from-a-mad-fientist/

[Jeremy E.]

You could finish your IRA contributions with $2,500 in a Roth IRA first, all of the contributions are very liquid. After that you can put it in Vanguard, Betterment or pay off your mortgage. I don't think any of those options are bad, and either way it sounds like your on a quick path to FI, Good Luck! Below are some articles that might help your decision making.

Here are some posts about Betterment,
http://www.madfientist.com/moving-my-money-to-betterment/
http://www.mrmoneymustache.com/2014/11/04/why-i-put-my-last-100000-into-betterment/
http://jlcollinsnh.com/2013/12/16/betterment-wants-to-give-you-25/

However, here is a post of why I choose Vanguard over Betterment
http://jlcollinsnh.com/2012/09/07/stocks-part-x-what-if-vanguard-gets-nuked/

My concern with the Roth is that I am often in the highest tax bracket so I am screwing myself out of quite a bit by putting my money there now, whereas with the tax deferred, I will be at the lowest tax bracket when I begin to withdraw (<$40k).

What is the particular advantage your referencing of contributing to the Roth? Just the liquidity?

You said you were only putting $3000 into IRA, and the rest into a trade account, however you shouldn't not use all of your IRA.

[PFHC]

You could finish your IRA contributions with $2,500 in a Roth IRA first, all of the contributions are very liquid. After that you can put it in Vanguard, Betterment or pay off your mortgage. I don't think any of those options are bad, and either way it sounds like your on a quick path to FI, Good Luck! Below are some articles that might help your decision making.

Here are some posts about Betterment,
http://www.madfientist.com/moving-my-money-to-betterment/
http://www.mrmoneymustache.com/2014/11/04/why-i-put-my-last-100000-into-betterment/
http://jlcollinsnh.com/2013/12/16/betterment-wants-to-give-you-25/

However, here is a post of why I choose Vanguard over Betterment
http://jlcollinsnh.com/2012/09/07/stocks-part-x-what-if-vanguard-gets-nuked/

My concern with the Roth is that I am often in the highest tax bracket so I am screwing myself out of quite a bit by putting my money there now, whereas with the tax deferred, I will be at the lowest tax bracket when I begin to withdraw (<$40k).

What is the particular advantage your referencing of contributing to the Roth? Just the liquidity?

You said you were only putting $3000 into IRA, and the rest into a trade account, however you shouldn't not use all of your IRA.

Not sure if I shouldn't not use all of my IRA, or if I should am? That's why I posted the question. :)

[PFHC]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

Great articles, thanks!

I looked into backdoor Roths a few months ago and, like your article mentions, it was not good idea due to having a sizeable traditional IRA already funded. I would have had to pay taxes on the conversion, which made it a wash.

HSA gives me pause due to the fact that, a.) I spend about $5/yr at the doctor, b.) I don't plan for that to change, and c.) I need a fund that I can withdraw from early. Waiting until 65 does not fit that bill.

Thanks for the leads, but I think my best option is going to be a tradition IRA, then use substantially equal periodic payments (I'll call them SEPP, 'cause lots of words) withdrawals along with taxable accounts to fund my life.

Thoughts on the SEPP? How much can I expect to withdraw? With a worse case anticipated $40k/yr COL, will I be able to fund that?

Not having medical bills is great, and is in no way a barrier to using an HSA as a stealth Roth. In fact any bills you do have should be paid for with cash in order to maximize tax free growth and withdrawals. Also, odds are someone in your family will have health bills sooner or later.

Also, Don't shut the door on the backdoor just yet. You should check if you can roll over your IRA into your 401k. If so, no pro-rata rule.

This also opens up the door to the Roth ladder, which I like better than the SEPP method.

http://jlcollinsnh.com/2013/12/05/stocks-part-xx-early-retirement-withdrawal-strategies-and-roth-conversion-ladders-from-a-mad-fientist/

That article opened my eyes. I get it. Brokerage fund should only be used to fund the five year set up period for the IRA ladder... thanks, man. Solid stuff there.

In my case, I will be maxing all my tax-advantaged accounts and still looking to invest a healthy sum.

Any ideas that I can look at with that?

Sent from my XT1094 using Tapatalk

[milesdividendmd]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

Great articles, thanks!

I looked into backdoor Roths a few months ago and, like your article mentions, it was not good idea due to having a sizeable traditional IRA already funded. I would have had to pay taxes on the conversion, which made it a wash.

HSA gives me pause due to the fact that, a.) I spend about $5/yr at the doctor, b.) I don't plan for that to change, and c.) I need a fund that I can withdraw from early. Waiting until 65 does not fit that bill.

Thanks for the leads, but I think my best option is going to be a tradition IRA, then use substantially equal periodic payments (I'll call them SEPP, 'cause lots of words) withdrawals along with taxable accounts to fund my life.

Thoughts on the SEPP? How much can I expect to withdraw? With a worse case anticipated $40k/yr COL, will I be able to fund that?

Not having medical bills is great, and is in no way a barrier to using an HSA as a stealth Roth. In fact any bills you do have should be paid for with cash in order to maximize tax free growth and withdrawals. Also, odds are someone in your family will have health bills sooner or later.

Also, Don't shut the door on the backdoor just yet. You should check if you can roll over your IRA into your 401k. If so, no pro-rata rule.

This also opens up the door to the Roth ladder, which I like better than the SEPP method.

http://jlcollinsnh.com/2013/12/05/stocks-part-xx-early-retirement-withdrawal-strategies-and-roth-conversion-ladders-from-a-mad-fientist/

That article opened my eyes. I get it. Brokerage fund should only be used to fund the five year set up period for the IRA ladder... thanks, man. Solid stuff there.

In my case, I will be maxing all my tax-advantaged accounts and still looking to invest a healthy sum.

Any ideas that I can look at with that?

Sent from my XT1094 using Tapatalk

My belief is that it is hard to beat betterment for taxable accounts.for those I think you're wise to follow Jack Bogle advice "don't just do something, Stand there! "

[johnny847]

The value of betterment is automated tax loss harvesting. The cost is an extra 0.15% expense ratio. This is on top of the expenses of the underlying funds (all Vanguard funds)

But the problem is tax loss harvesting is only an appreciable return, in terms of a percentage of your entire portfolio, in your portfolio's beginning years. If you make regular contributions over years, then so long as the market goes up on average as we expect it to in the long run, then a large portion of your portfolio's value will come from your oldest shares. These oldest shares will have large unrealized capital gains that can never be tax loss harvested (unless we're talking 1929 level market crashes).
Whereas betterment will charge a percentage of your portfolio every single year. See the problem?

I do see the problem for the long term. Would you see any downside to using it as a sort of savings account, one that would be used to fund the emergency credit and you could withdraw from to do home renovations, for example?

I do, but that's nothing against Betterment in itself. I wouldn't use stocks for any sort of savings account. They're simply too volatile.
Bond funds are merely okay, but they are susceptible to interest rate risk. I'd rather use a savings account, CD, or individual bond (but only if you were to ride out the bond to maturity would you eliminate your risk to principal).

[johnny847]

My belief is that it is hard to beat betterment for taxable accounts.for those I think you're wise to follow Jack Bogle advice "don't just do something, Stand there! "

At the risk of sounding like a broken record.

The value of betterment is automated tax loss harvesting. The cost is an extra 0.15% expense ratio. This is on top of the expenses of the underlying funds (all Vanguard funds)

But the problem is tax loss harvesting is only an appreciable return, in terms of a percentage of your entire portfolio, in your portfolio's beginning years. If you make regular contributions over years, then so long as the market goes up on average as we expect it to in the long run, then a large portion of your portfolio's value will come from your oldest shares. These oldest shares will have large unrealized capital gains that can never be tax loss harvested (unless we're talking 1929 level market crashes).
Whereas betterment will charge a percentage of your portfolio every single year. See the problem?

So if you started at Betterment, and after you've got a nice amount of unrealized capital losses you moved your assets in kind to Vanguard, you could probably come out ahead vs starting out at Vanguard and manually doing TLH.
I assume that Betterment lets you transfer your assets in kind.

But Betterment is a losing proposition for the long term.

[milesdividendmd]

No reason to repeat yourself.

As in reply 9, it would axiomatically stupid to transfer taxable accounts out of betterment as long as it is cheaper than Vanguard.

Its not difficult to figure out at the end of each year if you are net positive or negative in fees after TLH.

It may be reasonable to switch to vanguard when the fees outweigh the TLH savings, but there is no reason to do so before. That leaves money on the table.

[johnny847]

It may be reasonable to switch to vanguard when the fees outweigh the TLH savings, but there is no reason to do so before. That leaves money on the table.

Why exactly would you say it may be reasonable as opposed to it is reasonable? Where is the doubt coming from?

[milesdividendmd]

If the service and simplicity is worth 0.15 % - TLH savings to the investor (obviously.)

[johnny847]

If the service and simplicity is worth 0.15 % - TLH savings to the investor (obviously.)

So when the Betterment fees outweigh the TLH savings, what value is Betterment adding? I'm not seeing it.

[milesdividendmd]

You can do your own due diligence on what they offer.

What I personally like about their service.

Auto rebalancing
Auto investing of fractional shares so you are fully invested at all times.
Auto TLH
An evidence based low cost small value tilted portfolio that is far superior IMO to vanguards equivalent set it and forget it target date portfolios.
Excellent interface and customer service.

[Jellyfish]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

milesdividendmd, just wanted to say thanks for the links and advice. I've got a lot to learn and based upon the above think I can roll over a traditional IRA into my employer 401(k) and do a backdoor Roth.  This was a very helpful thread for me...

[milesdividendmd]

If you are in the highest tax bracket you can not contribute to a Roth IRA.

But you can and should contribute to a backdoor Roth. And you and your wife should do it every year before funding taxable IMO.

A stealth IRA or HSA is also a no brainer. Here are my thoughts on both of those.

http://www.milesdividendmd.com/the-back-door/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

As to betterment, I'm a huge fan of it for taxable accounts and this is how I choose to manage my taxable savings personally.

I have already made several years fees back in TLH, and it is quite easy to figure out your total tax savings and total fees each year.

As long as your fees are more than are offset by tax savings you will not beat betterment with a comparable portfolio from vanguard. No reason to switch now.

milesdividendmd, just wanted to say thanks for the links and advice. I've got a lot to learn and based upon the above think I can roll over a traditional IRA into my employer 401(k) and do a backdoor Roth.  This was a very helpful thread for me...

My pleasure!  Thanks.

[johnny847]

You can do your own due diligence on what they offer.

What I personally like about their service.

Auto rebalancing

See target date funds

Auto investing of fractional shares so you are fully invested at all times.

Vanguard does this too

Auto TLH

Already established this is only worth it for the beginning years
 

An evidence based low cost small value tilted portfolio that is far superior IMO to vanguards equivalent set it and forget it target date portfolios.

How much are you tilting anyways?

Excellent interface and customer service.

A matter of opinion. This is the only one where I would say maybe preferring Betterment is actually a rational decision.

[milesdividendmd]

You make the mistake of thinking that your opinion is "established" fact.  It's not, it's just your opinion.

As to how much I personally favor tilting, prior to investing my taxable account with betterment the only real change is that I used to own REITs in my Buy and hold portfolio. I would never structure my portfolio to look anything like a Vanguard target date fund. 

In my view betterments portfolio is far superior with both less Homefield bias and more exposure to proven "risk" premiums which have been statistically significantly associated with increased returns.

And with any all-in-one fund you basically forgo almost all tax loss harvesting opportunities which leaves a lot of money on the table.

What is patently obvious is that if you value paying the least amount possible, then it is wise to invest in betterment as long as your tax lost harvesting savings make it cheaper than Vanguard.

[johnny847]

You make the mistake of thinking that your opinion is "established" fact.  It's not, it's just your opinion.

What did I state previously that I asserted as fact but is opinion?

As to how much I personally favor tilting, prior to investing my taxable account with betterment the only real change is that I used to own REITs in my Buy and hold portfolio. I would never structure my portfolio to look anything like a Vanguard target date fund. 

You still didn't answer my question.

In my view betterments portfolio is far superior with both less Homefield bias and more exposure to proven "risk" premiums which have been statistically significantly associated with increased returns.

Okay, again, an opinion.

And with any all-in-one fund you basically forgo almost all tax loss harvesting opportunities which leaves a lot of money on the table.

This much is true. Sure, I can concede this one. Still though, manually TLHing can get you most of the benefit of auto TLHing, without the extra expense.

What is patently obvious is that if you value paying the least amount possible, then it is wise to invest in betterment as long as your tax lost harvesting savings make it cheaper than Vanguard.

At least we agree on that.

[PFHC]

You two need to chill. A little civil discourse would go a long ways. You don't have to agree and there isn't one right way. Sheesh.

Edit: answer my own question about tax loss harvesting.

[milesdividendmd]

You make the mistake of thinking that your opinion is "established" fact.  It's not, it's just your opinion.

What did I state previously that I asserted as fact but is opinion?

As to how much I personally favor tilting, prior to investing my taxable account with betterment the only real change is that I used to own REITs in my Buy and hold portfolio. I would never structure my portfolio to look anything like a Vanguard target date fund. 

You still didn't answer my question.

In my view betterments portfolio is far superior with both less Homefield bias and more exposure to proven "risk" premiums which have been statistically significantly associated with increased returns.

Okay, again, an opinion.

And with any all-in-one fund you basically forgo almost all tax loss harvesting opportunities which leaves a lot of money on the table.

This much is true. Sure, I can concede this one. Still though, manually TLHing can get you most of the benefit of auto TLHing, without the extra expense.

What is patently obvious is that if you value paying the least amount possible, then it is wise to invest in betterment as long as your tax lost harvesting savings make it cheaper than Vanguard.

At least we agree on that.

Right. An opinion.

The mistake isn't having opinions. It's confusing your own opinions for "established" facts, and labeling them as such.  Got it?

[johnny847]

You make the mistake of thinking that your opinion is "established" fact.  It's not, it's just your opinion.

What did I state previously that I asserted as fact but is opinion?

As to how much I personally favor tilting, prior to investing my taxable account with betterment the only real change is that I used to own REITs in my Buy and hold portfolio. I would never structure my portfolio to look anything like a Vanguard target date fund. 

You still didn't answer my question.

In my view betterments portfolio is far superior with both less Homefield bias and more exposure to proven "risk" premiums which have been statistically significantly associated with increased returns.

Okay, again, an opinion.

And with any all-in-one fund you basically forgo almost all tax loss harvesting opportunities which leaves a lot of money on the table.

This much is true. Sure, I can concede this one. Still though, manually TLHing can get you most of the benefit of auto TLHing, without the extra expense.

What is patently obvious is that if you value paying the least amount possible, then it is wise to invest in betterment as long as your tax lost harvesting savings make it cheaper than Vanguard.

At least we agree on that.

Right. An opinion.

The mistake isn't having opinions. It's confusing your own opinions for "established" facts, and labeling them as such.  Got it?

Again, you didn't answer my question. What did I state previously that I asserted as fact but is opinion?

[money_maniac]

Milesdividendmd- you are never going to convince johnny847 to use anything but Vanguard- he is a Vanguard fanboy at heart.

As for most other people, betterment is an extremely easy and cheap to use platform. It is intuitive and a way to "actively" invest through "passive" funds. The tax loss harvesting coupled with the cheap fees make is a no-brainer. As you have personal experience recouping your fees with the benefits of TLH, you are a prime example of the benefit it can provide.