As CEO of Betterment, can you share a bit about the company’s mission and how Betterment supports small businesses in their financial journey?
At Betterment, our mission is to “Make People’s Lives Better.” We offer workplace financial solutions that help small business employees plan and save for the future. In the U.S., there’s a shockingly wide retirement savings gap: over 56 million privately employed Americans lack access to retirement savings programs through their jobs(1). According to our 2024 Retirement Readiness Report, 56% of employees believe they’ll need at least $500,000 saved for retirement – yet only 38% expect to have that much saved. These concerns disproportionately affect small business employees, making our tools essential for the financial health of the modern workplace.
Tell us about the problem Betterment is solving for small businesses and how your company innovated to fill this gap in the marketplace.
Small businesses are historically underserved when it comes to financial services. When we were smaller, we struggled to find an easy-to-use and affordable retirement plan for our employees, so we built a record keeper. Our bundled 401(k) solution is easy-to-use, tech-enabled, and includes portfolios supported by more than a decade of investment expertise. Today our 401(k) anchors a broader financial offering for small business employees that includes emergency savings accounts, 401(k) student loan matching, high yield cash accounts, and financial coaching.
In honor of Small Business Saturday, can you tell us a story about a Betterment small business customer that has stayed with you?
A family-owned retail general contractor in California tasked their CFO with managing their 401(k) plan including working through their annual plan audit each year, which can be a daunting task even for much larger organizations. He turned to Betterment for both our technology and service. Betterment has been there to seamlessly assist him through successful audit seasons for the 4 years they’ve been with us. They credit us with a user-friendly interface and fast and accurate support.
From your perspective, are there any financial policy or regulatory changes that would help foster growth and innovation for small businesses? What role do you see Betterment playing in supporting these changes?
At Betterment we commend how Secure 2.0 addresses the practical trade-offs many savers face—especially those early in their careers—between building a financial foundation (such as paying down student debt or establishing emergency savings) and saving for retirement. Extending the concept of Secure 2.0 matches, like those for student loans and emergency savings, to other components of the American dream would be a powerful addition. For instance, matching 529 contributions or down-payment savings into retirement accounts could be transformative. Such initiatives would enhance financial wellness benefits that small and medium-sized businesses can offer, appealing to their workforces while also promoting retirement readiness and broader financial resilience.