Give donations better with Betterment
Robo advisory platform Betterment says it is not only making it easier to give to charities, it is also giving consumers more reasons to do so, reports Julie Muhn at Finovate (Banking Technology’s sister company).
Starting 28 November, on “Giving Tuesday”, Betterment investors will be able to donate shares of long-term investments from their taxable accounts directly to charitable organisations.
While the act of giving may grant users a warm heart, Betterment has made a point to emphasise the self-serving part of the equation – tax benefits. Investors who donate can eliminate capital gains tax on the contributed shares and can also deduct the value of the gift on their tax return. To make the process as easy as giving cash, the company does four main things:
- Tracks how much of your account is eligible to give to charity (i.e., it sorts for stocks that you’ve held for more than one year);
- Estimates the tax benefits before you complete your gift;
- Moves assets of up to $1 million from your account to a charitable organisation’s account without any paperwork;
- Emails a tax receipt after the donation is complete.
At launch, investors can give to eleven charities, including Unicef USA, Wounded Warriors Family Support, Hour Children, Against Malaria Foundation, DonorsChoose, GiveWell, Save The Children, Feeding America, Big Brothers Big Sisters of NYC, World Wildlife Fund, and Breast Cancer Research Foundation. Betterment is soliciting user requests for new charities to be added.
Founded in 2008, the New York-based company recently received a $70 million investment from Sweden’s Kinnevik, bringing Betterment’s total capital to $275 million and boosting it up to a valuation of $800 million.