Thank you for that calculator! I will utilize it. I'll also check out your post in the other thread.
Why do you believe that Betterment's ETF line-up is too complicated? I really like the wide exposure it provides.
It seems fine-tuned to perform well in backtesting during specific periods, so they can show off pretty charts about their portfolios (past) performance, leading people to believe they can expect similar (future) performance by giving them your money.
For example, they put all taxable bonds in Tax-Exempt ETF - MUB. If they were operating in our best interests, this would make no sense. Comparing it to an equivalent non-Tax-Exempt fund:
MUB is currently yielding 2.01%
Its equivalent non-Tax-Exempt fund is currently 2.77%
Putting 2.01% into the Tax Equivalent Yield Calculator, and moving the Income slider to the right until I beat 2.7%, shows that using a Tax-Exempt bond doesn't make sense unless I make $240,000 a year:
Do you earn over $240,000 a year? Do you think the majority of people investing with Betterment earn over $240,000 a year? Then this decision doesn't make sense. If I had to guess, I'd say it's good marketing.
Vanguard is
legally obligated to act in our best interests. Betterment is not.
See the difference?