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Betterment Gifts: A Better Gift Registry

This article was written by in Family and Life, Investing. 6 comments.


I introduced Betterment to readers last year as an alternative method of maintaining a brokerage account. For an annual fee of 0.15% to 0.35% of your assets invested with Betterment, the company provides a goal-focused way of investing for retirement and saving for future financial goals. The service handles asset allocation automatically based on goals, making this process ideal for hands-off investors.

Jon Stein, the founder of Betterment, has been preparing for his wedding. His approach to saving is such that receiving typical wedding gifts is not that important to him. He’d rather receive cash that he and his fiancée can use towards their larger goals. While there are a number of options for creating wedding gift registries, there hasn’t been a successful method of creating and maintaining a public cash gift registry that tracks friends’ contributions.

SmartyPig is fairly close. SmartyPig is a goal-oriented savings account with more in common with certificates of deposit. You can define custom goals and invite friends to contribute. But only Betterment uses the registry metaphor like the gift registries hosted by wedding websites like TheKnot or by retailers like Macy’s.

With Betterment’s gift registry, you could break goals into chunks of $50 gifts, for example. One saving goal you may already have in Betterment may be to buy a new house. To encourage your friends and family to contribute to this goal rather than buying you household items is to identify what you may need and ask for contributions. You may know you’re going to need to finish the basement in your new house. With the gift registry, you can include the finished basement as an item on the list, with the funds collected going towards your Betterment goal of buying a new house.

If you know the finished basement is going to cost $10,000, you can ask for 100 donations of $100 a piece. Betterment will track the number of gifts you receive towards this goal.

For a great example, see the gift registry for Betterment founder Jon Stein and his wife Polina. You can see the couple’s specific savings goals — a patio furniture set, a barbecue grill, and a down payment for a new house for example — and contribute to each goal in chunks of $50, $100, or $200.

New and current members can start the gift registry by visiting gifts.betterment.com. Visitors will be prompted to enter the type of event related to the registry, a wedding for example. On the same page, you will be able to enter specific savings goals related to that event and split each goal into reasonable dollar amounts for gifts. After this is complete, you will be able to share your registry with the public.

Unlike some other gift registries this is a completely free service. You do not need to pay a fee to publish the gift registry, there is no fee to collect contributions, and friends and family who wish to contribute do not need to worry about being charged a fee on top of their contribution. That’s not to say Betterment doesn’t profit from this service; funds that are contributed count towards the management fee, 0.15% to 0.35% of managed assets per year, a fee that Betterment charges on a quarterly basis.

Asking wedding guests for cash to be used towards a savings goal is certainly more practical than assembling a gift registry full of items that may not be necessary. When a young couple is getting started with their lives together, perhaps early in their career, other financial goals may be more important than having the finest silverware and china. There may be a stigma, however, with asking for cash from guests. A gift registry like this seems to find a happy medium between the traditional gift registry and a more practical approach to personal finances. Yet, some couples may be uncomfortable with the idea of asking guests for monetary contributions.

The the guests’ perspective, a close family member or friend might prefer to be associated with a useful object, so that the couple thinks of the contributor whenever that object is used or displayed. Giving a gift of money doesn’t have the same lasting effect, but there is no longer the concern about whether the couple would just end up returning the physical gift to the store for the cash, anyway.

A wedding isn’t necessary for creating a gift registry with Betterment. Visitors are encouraged to tie the registry to an event, and the tradition of gift-giving is most often associated with some type of life event, but that’s not a necessary component. Early retirement or financial independence can be considered an event, and this is a legitimate savings goal. Potential contributors, on the other hand, may be more willing to help if there is some sort of celebration attached.

For a limited time, Consumerism Commentary readers can receive a free gift of $25 towards a savings goal when they open a new Betterment account. Open an account, then visit gifts.betterment.com to create a registry.

Would you ask your wedding guests — or friends or family with or without an occasion — for gifts of cash? If you’re wary about asking for cash, does a registry like this make the request more palatable? Would you prefer to stick to traditional wedding registries?

Published or updated September 17, 2012. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 6 comments… read them below or add one }

avatar Jenna, Adaptu Community Manager

I think it is fine to accept cash at a wedding, but not to ask for it. And definitely not through an electronic system. Seems a little tacky. Maybe you could put it all in a fund and share with people what you are doing with the money, or a child’s college saving plans or charity, but it just seems a little weird for a wedding.

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avatar MB @ 12 Year Career

I think it could also be argued that traditional wedding registries are tacky, especially with some of the completely frivolous items that I’ve seen on some of them.

We went with a system similar to the once described in this article, but we didn’t push it on people. In fact, I think our guests would have only found it if they went to our wedding website and chose to look at our registry information. And then, at the top of the registry was a note informing guests that “your presence is enough of a present for us” and “we both lived on our own for a few years, so we do not need any household items”.

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avatar Evan

Since I am from the Northeast almost all wedding gifts are done by check or cash. I would love to have this option so I didn’t have to worry about remember a check and a card, but I don’t think I would ever use it until it became a lot more socially accepted.

As far as any other event (maybe a baby baptism) it would just seem weird. “I am having a house warming, please pay me with gifts here lol”

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avatar Brittany, Betterment Team

Hi All, Brittany from Betterment here. I just wanted to clarify that Betterment Gifts is all about providing people with a smarter option in situations for which they would likely receive gifts anyway. Think about a wedding: did you know that 93% of couples register for wedding gifts (per a 2011 study conducted by Brides Magazine)? Family members and friends often want to give gifts in celebration of the event. Betterment Gifts provides an intelligent alternative to getting a fruit bowl or gravy boat you may never use. What’s tacky is that there are plenty of cash registries that charge high transaction and usage fees to the gift-giver or receiver! What’s even tackier, is that, per Life at Home in the Twenty-First Century, 75% of Americans said they’ve so filled up their garages with stuff, they cannot fit their cars in! Through Betterment Gifts, you replace the clutter from consumable gifts with contributions toward important life goals. If your friends and family will be giving you gifts for a major milestone, why not receive something smarter?

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avatar Kolelemook

I think opinions from folks who are not making money off the process are more valuable!

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avatar andrea1983 ♦226 (Cent)

It’s good ideal. I think it is fine to accept cash at a wedding, but Seems a little tacky. Maybe you could put it all in a fund and share with people what you are doing with the money, or a child’s college saving plans or charity, but it just seems a little weird for a wedding.

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