Betterment, a wealth and savings platform, and Capitalize, a platform for digital retirement account transfers, have announced a new partnership. The collaboration aims to assist Betterment customers in locating and consolidating retirement savings accounts.
Through this partnership, Betterment will integrate Capitalize’s Embedded Rollover API directly into its platform. This integration will enable Betterment customers to digitally identify and transfer employer-sponsored retirement accounts, such as 401(k)s, into Individual Retirement Accounts (IRAs) held at Betterment. This process is designed to allow customers to leverage Betterment’s investment portfolios and manage their assets within a single account.
Mike Reust, President at Betterment, stated that retirement is a critical aspect of building wealth. He noted the historical complexity of account rollovers and expressed enthusiasm for partnering with Capitalize to offer a more intuitive method for customers to consolidate their 401(k)s.
Gaurav Sharma, CEO and Co-Founder of Capitalize, commented on the partnership, highlighting a shared commitment to addressing gaps in the retirement savings market. He emphasized helping individuals effectively consolidate their 401(k) savings through innovative technology.
Millions of Americans utilize 401(k) accounts for retirement savings. However, transitions between jobs often lead to confusion, resulting in actions like premature withdrawals or leaving accounts unattended. Research indicates that over 30 million 401(k) accounts are left behind, with fees and static asset allocations potentially diminishing savings over time. While many individuals intend to roll over their accounts, only 22% complete the process without assistance.
By embedding Capitalize’s rollover technology, Betterment aims to facilitate the digital location of legacy retirement accounts, initiation of rollover requests, and consolidation of retirement savings, all within its platform. This feature will be available to Betterment’s retail customers in the coming weeks.
Capitalize is a platform that aids individuals and financial institutions in digitally locating and transferring retirement assets like 401(k)s. Its APIs are adopted by financial institutions to enable native rollover experiences. Capitalize has received recognition from publications such as TIME and Forbes for its contributions to the fintech sector.
Betterment is a wealth platform offering technology-driven solutions for investing, saving, and retirement. It provides automated and self-directed investing, personalized financial advice, and high-yield cash management accounts. Betterment serves retail investors, small to mid-sized businesses through Betterment at Work, and independent RIAs via Betterment Advisor Solutions, managing over $65 billion in assets for more than 1 million customers.
