Integrate with Betterment 401(k)

You’ll need to have admin permissions in both Gusto and Betterment before you connect your company’s accounts. If you’re setting up a 401(k) for the first time, get started with Betterment here. Once you've set up or transferred your 401(k) with Betterment, follow these steps to integrate the benefit with your Gusto payroll.

1. Sign in to your Betterment admin account.
2. Go to the Pay section.
3. In the card that says “You’re eligible for an integration with Gusto,” click Start setup. 
4. Click Go to Gusto.
5. Click Let’s do this.
6. Click Go to Gusto.
7. Enter your Gusto admin credentials and click Sign In. 
8. Click Authorize.

Once you click “Authorize,” your Gusto and Betterment accounts are connected. 

Next steps

1. Betterment’s onboarding team will review your account to make sure the connection is set up correctly.
2. After Betterment’s review, you’ll receive an email from them asking you to look over any employee data imported from Gusto.
3. If you do not have Gusto-managed health benefits, you’ll need to change or add employment status changes in Betterment:
   • Sign in to Betterment and go to Employees.
   • Select Needs Review.
   • Next to each employee's name, click Resolve to update their employment type.
4. Next you’ll have the opportunity to create accounts for any employees who need them. 
5. The first time you run payroll after setting up the integration, you’ll need to review and approve the details in Betterment. 

The first time you run payroll after setting up the integration, you’ll need to approve the payroll deductions in Betterment. Subsequent payrolls you run will be automatically approved.

1. Run payroll in Gusto.
   • On the “Review and submit” screen, click Download a full summary to see a full breakdown including the new 401(k) contributions and deductions.
2. Sign in to Betterment.
3. Go to the Pay section.
4. Under “Payroll integration setup guide,” click Review payroll.
5. Click Continue.
6. Review your team’s 401(k) participation and contributions. 
7. Click Approve payroll.

In Betterment, payroll activity is logged on the Pay section under “Activity.” Click the blue arrow next to a payroll to review employee and company contributions. 

When an employee is about to become eligible to participate in the 401(k) plan, Betterment will email you to approve their eligibility and invite them to sign up. Click the prompt in the email or log in to your Betterment dashboard to begin.

1. Sign in to Betterment.
2. In the left-hand menu, click Tasks.
3. Click Upcoming participant eligibility.
4. Click on the name of the newly eligible employee you want to approve.
5. Click Edit eligibility.
6. If the eligibility date is correct, you can confirm.
   
   • Keep in mind that if your company has a new hire waiting period, your employee's eligibility date may be after their hire date.
7. If they should not enter the plan until a later date, select Not eligible and enter the date they should enter the plan.

Once you approve an employee's eligibility date, they’ll receive an email from Betterment inviting them to sign up and start contributing to their 401(k). 

If contributions haven't started yet for a new hire, it's likely because they're not yet eligible to enroll per your company's plan settings. This could also be because the new hire enrolled after your payroll admin already ran payroll for the pay period. 

When you want data about your company’s 401(k) plan and contributions, admins can download a few different kinds of reports from Betterment. 

1. Sign in to Betterment.
2. In the left-hand menu, go to Resources.
3. Under the “Reports” tab, click Run a report.
4. Choose a report type from the dropdown.
5.  Select a timeframe.
6. Click Run report. 
7. Refresh your browser window to load the report.

Running payroll after the plan's start date

Once the plan's start date has passed, running payroll in Gusto will automatically deduct employee contributions and record company contributions. The day after the check date, Betterment debits the company for both the employee deductions and company contributions. Betterment invests the funds in employees’ 401(k)s the following day. If you have questions about debits or plan funds, please contact Betterment.

Missing payroll deductions

There are a few reasons why there may not be payroll deductions:

• Your plan may not have started yet—check your Betterment account to confirm the start date.
• The employee may not yet be eligible for the benefit per your plan's eligibility settings.
• The employee has not enrolled.
• Your company may have run payroll before the enrollment or deduction change was processed. 
• Taxes are applied before deductions. The employee may have had $0 in net pay after taxes.
• Reimbursements are not eligible for 401(k) deductions. 
• The employee may have reached the IRS annual contribution limit. 

Employee data syncing

A sync runs between Gusto and Betterment multiple times per day.

Changing someone's employment type

If you have Gusto-managed health benefits, you can change someone's employment status in Gusto. Admins will then receive an email to approve their updated Betterment eligibility.

If you do not have Gusto-managed health benefits, make employment status changes in Betterment:

1. Sign in to your Betterment admin account.
2. Go to Employees
3. Select Needs Review.
4. Next to an employee's name, click Resolve to update their employment type.

New hires 

Here's what happens when you hire someone in Gusto:

1. The new hire's info automatically syncs to Betterment.
2. Admins will receive an email when it’s time to approve their Betterment eligibility.
3. Once they fulfill any eligibility requirements (such as a new hire waiting period), Betterment invites them to enroll.
4. Their deductions will be automatically added to payroll.

Important: If contributions have not started for a new hire, they may not be eligible to enroll yet, or they may have enrolled after payroll was run for the pay period.

Change contributions or policy settings

Reach out to Betterment to change any of your company's policy settings. 

Important: Changing the company match for a specific payroll is not permitted per 401(k) plan policies. The company match cannot be blocked on any payroll, including off-cycle payrolls. 

Loans 

If your plan allows participants to request loans, employees can reach out to Betterment to apply.  Once the employee reaches the repayment stage of the loan, Betterment will notify them with instructions. If Betterment collects the repayment through payroll deductions, the employee can expect to see post-tax loan deductions on their paystubs. Refer to the terms of your loan or contact Betterment to confirm your repayment method. 

Payroll data not syncing

In order for payroll data to sync, Gusto must be set as your payroll provider in Betterment. If you’ve changed your payroll provider since starting your 401(k), contact Betterment to update it.

Employee dismissals

When an employee is dismissed, their dismissal date syncs to Betterment. The employee will receive steps to roll over their 401(k) to another provider or keep it with Betterment.

Regular 401(k) contributions will be made on a dismissal payroll. 

Severance payments are not eligible for 401(k) deductions. You must use the Gusto-provided severance earnings type to automatically block deductions and contributions for severance payments. 

If your plan allows participants to request loans or distributions, you may receive an email requiring you to approve them through the Betterment dashboard. Click the prompt in the email or log in to your Betterment dashboard to manage requests.

1. Sign in to Betterment.
2. In the left-hand menu, click Tasks.
3. Click either the “Pending loan requests or “Pending distribution requests” task.
4. Choose the pending request you want to review.
5. Select either Approve loan or Reject loan.

The employee will receive an update via email with next steps. Once the employee reaches the repayment stage of the loan, Betterment will notify them with instructions. If Betterment collects the repayment through payroll deductions, the employee can expect to see post-tax loan deductions on their paystubs.

Q: Why was my employee’s paycheck missing 401(k) benefits?

A: See "Troubleshoot missing payroll deductions" for more information.

Q: I have a question about a notification in my Betterment portal. Who should I contact?

A: Contact Betterment for more information. 

Q: I have a question about an employee’s enrollment or an election synced to Gusto. Who should I contact?

A: Contact Betterment for more information. 

Q: I have a question about plan funds. Who should I contact?

A: Contact Betterment to discuss plan funds or debits for plan funds.  

Gusto and Betterment work together to help you manage your plan. Here’s how Gusto and Betterment can help.

When to contact Gusto 

Contact Gusto for questions about:

• 401(k) calculations on payroll
• Why 401k deductions were not applied
• Payroll corrections with Betterment 401(k)

Examples:

• “How was my employee’s 401k deduction calculated?”
• “Why weren’t there deductions on my employee’s check?”
• “My employee was overpaid, and I need to reverse their payroll.”

When to contact Betterment

Contact Betterment for questions about:

• Your 401k plan
• Syncing benefits to Gusto
• Plan funds, including debits
• Employee eligibility
• Changes to your 401k plan

Examples:

•  “When does our plan begin?”
• “Our company set up a new Betterment plan. When can I expect our benefits to reflect in Gusto?”
• “My employee enrolled but their benefits have not synced to Gusto yet. When will their benefits sync?”
• “My employee updated their elections in Betterment. When will the new amounts sync to Gusto?”'
• “Why was I debited this amount for 401k funds?”
• “When can my new hire enroll?”
• “We would like to update the employer match.” 

How to contact Betterment

Here are a few ways you can get more help:

• Check out Betterment’s Help Center
• Schedule a call with Betterment directly: Sign in to your plan sponsor dashboard, go to Resources, then click Support.
• Email [email protected]