Betterment for Advisors has partnered with a trio of wealthtech companies on a software bundle for independent advisors, but says it’s not trying to compete with RIA networks that offer technology suites to members.
The RIA Tech Suite includes Betterment’s for-advisors digital advice platform, RIA in a Box for compliance and cybersecurity,
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RIAs already on the platform can stick with the old pricing model or transition to the new one.
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“Financial wellness is front and center [for employers], so the partnership between Betterment and Lumity made perfect sense,” says Amit Ahluwalia, Lumity’s national employee benefits practice leader.
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Advisors can now access model portfolios and client “Risk Numbers” from within the financial planning software.
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Betterment already partners with the other companies in the RIA Tech Suite and noticed a significant amount of shared customers, says Jon Mauney, general manager of Betterment for Advisors, when asked why it selected these three out of the entire market of wealthtech providers.
“The four companies involved represent a fairly complete solution for what an advisor needs to run their practice,” Mauney says. “Especially for new RIAs that are looking for a tech stack.”
The package is similar to what advisors can find at the XY Planning Network, says XYPN co-founder and Financial Planning contributor Michael Kitces. XYPN has offered Wealthbox to members since 2014, and Betterment and RightCapital since 2015, but provides a proprietary compliance tool rather than RIA in a Box. The network, which is an organization of fee-only financial planners focused on Gen X and Gen Y clients, has four additional vendors on its technology platform, Kitces says.
While RIA Tech Suite offers a discount on the monthly per-advisor fee to use the technology, XYPN members also get a discount on Betterment’s wrap fee. Some advisors on Twitter wondered if there were any additional benefits to going with the RIA Tech Suite if a better fee discount can be found elsewhere.
I use this whole stack (xy member) and I wonder what benefit this provides to me as a user of all of them? New/better integrations? Streamlined workflows across the systems? Or is it purely a discount bundle.
— Ryan Frailich, CFP®,CSLP® (@RFrailich) June 22, 2021
The discount is fine (you can get a bigger discount through other groups) but incentive for integration seems to be a bigger deal, IMO
— Bill Nickles (@billnickles) June 22, 2021
Betterment does have some tech integration with the other members of the RIA Tech Suite — the wealthtechs can grab client account data from Betterment’s custodial platform — but isn’t announcing anything new quite yet, Mauney says. However, the company is looking at how it could incorporate functionality from Co-pilot, the
“On the integration front, we’re making sure it’s easy to get to the place where information is easy to access, rather than be everything for everybody,” Mauney says, adding that building an all-in-one dashboard for advisors is tough to pull off. “You have to make a lot of choices along the way about who you want to go deep with on two-way integration, and we’re not making any decisions on that yet.”
Betterment is also not trying to compete with advisor networks like XYPN, Mauney says.
