Betterment calculates net worth by aggregating your linked accounts and applying rules that distinguish assets from liabilities. The platform pulls balances in real time, then standardizes the data to show a single, evolving picture of your financial position.
Understanding how this works helps you trust the number you see and use it to guide decisions about cash flow, risk, and long term goals. The following sections detail the technical and behavioral factors behind the calculation and how you can interpret the results.
| Data Source | How Betterment Reads It | Classification | Refresh Cadence |
|---|---|---|---|
| Bank Accounts | Read account balances via Plaid or institution APIs | Asset or liability based on account type | Daily, with near real time updates |
| Investment Accounts | Pull market value, including cost basis and cash positions | Asset at market value | Multiple times per day for liquid holdings |
| Loan and Credit Card Accounts | Import outstanding principal and recent transactions | Liability, including accrued interest | Daily, reflecting payments and new balances |
| Retirement and Custodial Accounts | Sync via secure read only credentials | Asset at current market value | End of day or near real time, depending on provider |
How Account Linking And Authentication Work
Betterment relies on secure, read only connections to pull data from banks, brokerages, and loan providers. These connections use tokenized credentials so that your username and password are never stored on Betterment servers, reducing exposure and improving reliability.
Supported Institution Types
During onboarding, you select institutions and grant limited access. The platform then normalizes provider specific formats into a common data model that feeds the net worth calculation.
Asset Valuation And Currency Conversion
Assets are marked to market using the latest available price, which for stocks and funds is usually the previous close or an intraday midpoint. For cash holdings, the value remains at the reported balance, while crypto positions are converted into your reporting currency using real time exchange rates.
Currency conversion adds a layer of precision, ensuring that accounts in different currencies contribute consistently to a single net worth figure. Exchange rate sources are reputable third party feeds with timestamps attached for auditability.
Liability Aggregation And Interest Handling
Liabilities are aggregated across loans, credit cards, and lines of credit using the outstanding principal plus any accrued interest. If you link payment accounts, scheduled payments can reduce balances on the expected payoff date, which changes the net worth impact over time.
Betterment handles compounding schedules and grace periods by relying on institution reported balances, which typically reflect the most recent statement cycle. This keeps the net worth number aligned with what your lenders track.
Exclusions And Manual Adjustments
Not every account you own automatically flows into your net worth dashboard. Prepaid cards, stored value accounts, and certain business accounts may be omitted if they cannot be linked securely or reliably. You also have the option to add manual adjustments for items like jewelry, art, or anticipated inheritances, clearly labeled as user entered so they do not misrepresent automated data.
Key Takeaways And Practical Steps
- Link only the accounts you want included and review authentication periodically for security.
- Understand that daily fluctuations are normal due to market pricing and currency changes.
- Use manual adjustments sparingly to capture assets or liabilities that automated imports miss.
- Monitor the trend line rather than day to day noise to evaluate true progress.
- Check data sources and refresh schedules for any account that seems out of date.
FAQ
Reader questions
How often does Betterment recalculate my net worth after a large market move?
Betterment updates net worth multiple times per day for investment accounts, so a sharp market move typically appears within hours, though exact timing depends on exchange settlement and data provider schedules.
Why does my net worth sometimes drop even though I did not spend money?
Declines can occur when linked investments fall in value, when currency movements reduce the value of foreign holdings, or when newly imported loans show higher interest accrual than expected.
Can I exclude certain accounts from the Betterment net worth calculation?
You can only exclude accounts by not linking them in the first place. For items you own but do not want included, use manual adjustments to offset balances or avoid adding the account credentials. Most pending transactions are reflected in net worth based on institution provided balances, which typically include authorized holds. Settlement timing varies by bank, so small timing differences may appear until the transaction fully clears.