Betterment and Goldman Sachs Launch Industry-First Tax-Smart Bonds Portfolio

Rhea-AI Summary

Betterment and Goldman Sachs Asset Management have launched the Goldman Sachs Tax-Smart Bonds portfolio, an industry-first offering designed to generate after-tax yield for investors in higher tax brackets. This innovative portfolio combines short-duration US Treasury bonds, high-quality corporate bonds, and municipal bond ETFs, with Betterment personalizing allocations based on individual tax situations.

The strategy adapts to market conditions and taxable equivalent yields monthly, considering events that might create volatility. This collaboration leverages Goldman Sachs' expertise in bond markets and Betterment's automation to provide a potentially lower-risk alternative to equity investing for long-term wealth building.

Positive

• Launch of industry-first Goldman Sachs Tax-Smart Bonds portfolio
• Collaboration between Betterment and Goldman Sachs Asset Management
• Personalized portfolio allocations based on individual tax situations
• Adaptive strategy considering market conditions and taxable equivalent yields

Negative

• None.

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Betterment to Personalize Strategies for Investors Seeking After-Tax Yield

NEW YORK, July 18, 2024 /PRNewswire/ -- Betterment and Goldman Sachs Asset Management are excited to announce the launch of the Goldman Sachs Tax-Smart Bonds portfolio. This industry-first portfolio leverages Goldman Sachs' expertise in bond markets and Betterment's automation. The portfolio seeks to generate after-tax yield.

Betterment to Personalize Strategies for Investors Seeking After-Tax Yield

The Goldman Sachs Tax-Smart Bonds portfolio is designed for Betterment clients in higher tax brackets, who want to access a tax-smart bond strategy which is potentially lower risk than equity investing. While high-interest cash savings products can be beneficial for shorter-term needs, taxes can reduce yields over time. This new portfolio offers short-duration bond exchange-traded funds (ETFs), with holdings that Betterment will personalize for its customers based on their tax situation.

By combining short-duration US Treasury bonds, high-quality corporate bonds and municipal bond ETFs, Goldman Sachs designed this innovative strategy to marry longer-term trends with current bond market conditions, rather than maintaining static allocations over time. This approach can adjust the strategy for events that might create volatility such as the COVID-19 pandemic and US debt ceiling debates. The portfolio strategy considers market conditions and taxable equivalent yields monthly, and Betterment may make adjustments, based on individual tax brackets, as appropriate. Betterment then personalizes portfolio allocations for its clients' individual tax situations to seek to generate higher after-tax yield.

"We are thrilled to collaborate with Goldman Sachs to bring an innovative bond portfolio to Betterment customers," said Sarah Levy, CEO of Betterment. "We continue to work tirelessly to provide investment products that support our customers in their long-term wealth-building journey."

"It is important for investors seeking to create and safeguard long-term wealth to consider after-tax returns in their portfolios," said Padideh Raphael, Global Head of Third Party Wealth at Goldman Sachs Asset Management. "This latest collaboration, combining Goldman Sachs's investment capabilities with Betterment's innovative technology platform and customer-first approach, will allow us to work together on behalf of clients who seek attractive after-tax bond yields."

For more information about the Goldman Sachs Tax-Smart Bonds portfolio, please visit Betterment's website.

About Betterment
Betterment LLC ("Betterment") is the largest independent digital financial advisor, using automated technology powered by human expertise to fulfill a singular mission: making people's lives better. With easy-to-use saving, investing, and retirement solutions, Betterment is built to help people optimize their money, no matter their level of experience or how the market is doing. Launched in 2010, Betterment helps more than 850,000 customers manage over $45 billion with curated selections of low-cost, expert-built investing portfolios; personalized guidance; and tax-smart tools. The company has received multiple awards for its investing app, including Buy Side from WSJ (2024) and Bankrate (2024). Learn more and for additional disclosure on these awards, visit https://www.betterment.com/#award-disclosure.

About Goldman Sachs Asset Management

Goldman Sachs Asset Management is the primary investing area within Goldman Sachs (NYSE: GS), delivering investment and advisory services across public and private markets for the world's leading institutions, financial advisors and individuals. The business is driven by a focus on partnership and shared success with its clients, seeking to deliver long-term investment performance drawing on its global network and deep expertise across industries and markets. Goldman Sachs Asset Management is a leading investor across fixed income, liquidity, equity, alternatives and multi-asset solutions. Goldman Sachs oversees more than $2.9 trillion in assets under supervision as of June 30, 2024. Follow us on LinkedIn.

Contact info: Media@betterment.com

Each service provider mentioned is solely responsible for the information provided on its services and fees, and for its performance of its services. Information provided by Betterment is not verified by GSAM. Inclusion of Goldman Sachs' or GSAM's name or logo on Betterment's website, advertisements, or any other communications does not indicate that the information contained therein is provided or approved by Goldman Sachs.

Betterment, not Goldman Sachs, is responsible for its advisory relationships with clients.

Assets Under Supervision includes assets under management and other client assets for which Goldman Sachs does not have full discretion. 

Goldman Sachs does not provide legal, tax or accounting advice. Goldman Sachs clients should obtain independent tax advice based on their particular situation.

Betterment, not GSAM, is responsible for monitoring wash sales and any other potential loss disallowance as a result of disposition of a security in the portfolio.

Investment returns may vary. Not a guarantee of future performance; investing involves risk, including loss of principal. To review historical performance, please visit https://www.betterment.com/goldman-sachs-tax-smart-bonds-portfolio.

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SOURCE Betterment

FAQ

What is the Goldman Sachs Tax-Smart Bonds portfolio launched by Betterment and Goldman Sachs (GS)?

The Goldman Sachs Tax-Smart Bonds portfolio is an industry-first offering that combines short-duration US Treasury bonds, high-quality corporate bonds, and municipal bond ETFs. It's designed to generate after-tax yield for investors in higher tax brackets, with Betterment personalizing allocations based on individual tax situations.

How often does the Goldman Sachs Tax-Smart Bonds portfolio strategy adjust?

The portfolio strategy considers market conditions and taxable equivalent yields monthly, with Betterment making adjustments based on individual tax brackets as appropriate.

Who is the target audience for the Goldman Sachs Tax-Smart Bonds portfolio?

The portfolio is designed for Betterment clients in higher tax brackets who want to access a tax-smart bond strategy that is potentially lower risk than equity investing.

What makes the Goldman Sachs Tax-Smart Bonds portfolio unique?

It's an industry-first offering that combines Goldman Sachs' expertise in bond markets with Betterment's automation to provide personalized, tax-efficient bond strategies for investors.