• What is Cash Reserve? It’s like a holding area for money you plan to invest later. Don’t think of it as a long-term saving spot.
  • Where Does Your Money Go? Betterment Securities, acting for you, puts your money in special bank accounts at different banks. These are called “Deposit Accounts”.
  • Is Your Money Safe? Yes, up to certain limits. The government’s FDIC insures these Deposit Accounts. If a bank in the program goes under, your money (and any interest it earned) is safe up to $250,000 per bank.
    • Example: If you put money in the Cash Reserve and Betterment spreads it across 8 banks, you could have up to $2 million ($250,000 x 8 banks) insured.
  • What if I Don’t Want My Money in Certain Banks? You can choose to exclude some banks. But remember, if you exclude banks, you might have less FDIC insurance coverage overall.
  • Will I Earn Interest? Yes. The banks decide the rate, and it can change daily. You’ll see how much interest you earn at the start of each month.
  • Any Fees? Betterment Securities doesn’t directly take a cut from Cash Reserve. But they do earn from the banks in the program.
  • How Do I Track My Money? Every month, Betterment Securities will give you a statement showing:
    • Money you put in or took out.
    • Your account balance at each bank.
    • The interest you earned.
    • The interest rate of each bank.
    Don’t expect a statement from the individual banks. If there’s a mistake, tell Betterment Securities.
  • Taxes? The interest you earn will probably be taxed. Every year, Betterment Securities will send you a tax form called Form 1099-INT. Speak to a tax advisor about any tax questions.
  • Changes to the Program? Betterment can change the terms. They’ll tell you if they do. Always check their website for the latest info.

Please note: This is a summary and simplification of the real detailed program. Always consult the actual terms and conditions or a financial advisor for full details and advice.

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