I’ve looked at theoretical performances of
models from Betterment, WealthFront, and Vanguard. I’ve also learned quite a bit about each
simply by interacting with their web sites. In addition, Personal Capital, the
firm whose advisor started this process for me, is responsible for convincing
me to use the approach of allocating my investments over different asset
classes and rebalancing periodically.
So, am I ready to pick between these alternatives? No. Clearly
I have decided to manage my own investments. I am in the process of designing and
implementing my own investment plan. It’s a lot more work than I anticipated.
At the same time, I am looking at these issues for someone else. This person is
pretty much the opposite of me. She is young, employed, and with less money to
invest. It’s become apparent that the effort that I’m making is not feasible
for her. So, one of the above choices might be a better approach in her case.
In the interim, I have not been able to eliminate any of the
four alternatives that I’ve encountered. That’s because there is something to
like about each.
Vanguard is the least expensive of the group. If you use one
of the other three, then you will end up with substantial investments in the
Vanguard products anyway.
Betterment has a lower cost of entry and may be easier to
use than the others.
WealthFront offers more asset classes than the two previous
choices. I particularly like the inclusion of a real estate ETF in the mix.
I am quite fond of Personal Capital. They seemed to have a
more substantial approach. This is likely because they involve human
interaction. But, this comes with a price, the highest cost.
So my jury is still out. Hopefully not for long though.
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