This article is for admins who want to integrate Betterment 401(k) with Gusto.
Betterment1 makes it easy to offer employees a 401(k) plan at a low cost. When you integrate Betterment with Gusto, the platform automates your 401(k) management. It automatically syncs data, sets up new employees, and manages contribution rate settings.
We deduct 401(k) contributions from employees’ paychecks and deposit the funds into your company’s bank account. You then pay Betterment in one lump sum.
You need admin permissions in both Gusto and Betterment before you connect your accounts. If you’re setting up a 401(k) for the first time, get started with Betterment. After you set up or transfer your 401(k) with Betterment, follow these steps to integrate it with your Gusto payroll.
To connect to Gusto from Betterment:
Go to Pay.
In the card that says “You’re eligible for an integration with Gusto,” click Start setup.
Click Go to Gusto.
Click Let’s do this.
Click Go to Gusto.
Enter your Gusto admin credentials and click Sign In.
Click Authorize.
When you click Authorize, your Gusto and Betterment accounts are connected.
Complete setup in Betterment
After you connect your accounts, complete these steps to finish your setup:
Betterment’s onboarding team will review your account to make sure the connection works correctly.
Betterment will email you and ask you to review any employee data that Gusto imported.
If you do not have Gusto-managed health benefits, you need to update employment status changes in Betterment:
Go to Employees.
Select Needs Review.
Next to each employee’s name, click Resolve to update their employment type.
Next, you can create accounts for any employees who need them.
The first time you run payroll after you set up the integration, you need to review and approve the details in Betterment.
The first time you run payroll after setting up the integration, you need to approve the payroll deductions in Betterment. Betterment will automatically approve your future payrolls.
To approve your first payroll in Betterment:
On the Review and submit screen, click Download a full summary for a complete breakdown of 401(k) contributions and deductions.
Go to Pay.
Under Payroll integration setup guide, click Review payroll.
Click Continue.
Review your team’s 401(k) participation and contributions.
Click Approve payroll.
Betterment logs payroll activity in the Pay section under Activity. Click the blue arrow next to a payroll to review employee and company contributions.
Betterment emails you when an employee becomes eligible for the 401(k) plan. You need to approve their eligibility, so Betterment can invite them to sign up. Click the link in the email or sign in to your Betterment dashboard to start.
To review and approve new hire eligibility:
In the left menu, click Tasks.
Click Upcoming participant eligibility.
Click on the name of the employee you want to approve.
Click Edit eligibility.
If the eligibility date is correct, confirm it.
Note: If your company has a new-hire waiting period, the employee’s eligibility date may come after their hire date.
If the employee should not enter the plan until a later date, select Not eligible and enter the date they should enter the plan.
After you approve an employee’s eligibility date, Betterment will email them an invitation to sign up and start contributing to their 401(k).
If contributions for a new hire have not yet started, the employee might not be eligible under your company’s plan settings. The employee might also have enrolled after your payroll admin already ran payroll for the pay period.
You can download reports from Betterment to get data about your company’s 401(k) plan and contributions.
To run a report in Betterment:
In the left menu, go to Resources.
Under the Reports tab, click Run a report.
Choose a report type from the dropdown.
Select a timeframe.
Click Run report.
Refresh your browser window to load the report.
After Gusto and Betterment are connected, admins can manage their 401(k) plan directly through both platforms.
Run payroll after the plan starts
After the plan starts, we automatically deduct employee contributions and record company contributions when you run payroll. 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, contact Betterment.
Troubleshoot missing payroll deductions
Payroll deductions may be missing for several reasons:
Your plan has not started yet. Check your Betterment account to confirm the start date.
The employee may not yet be eligible, per your plan’s eligibility settings.
The employee has not enrolled.
Your company ran payroll before we processed the enrollment or deduction change.
We apply taxes before deductions. The employee had $0 in net pay after taxes.
We do not deduct 401(k) contributions from reimbursements.
The employee reached the IRS annual contribution limit.
Sync employee data between Gusto and Betterment
We sync data with Betterment multiple times per day.
Change an employee’s employment type
If you have Gusto-managed health benefits, you can change an employee’s employment status in Gusto. Admins will then get an email to approve their updated Betterment eligibility.
If you do not have Gusto-managed health benefits, make employment status changes in Betterment:
Go to Employees.
Select Needs Review.
Next to an employee’s name, click Resolve to update their employment type.
Add new hires
When you hire someone in Gusto, their information automatically syncs to Betterment. Here’s what happens next:
Admins will get an email when it’s time to approve their Betterment eligibility.
After the new hire meets any eligibility requirements (like a new-hire waiting period), Betterment invites them to enroll.
We automatically add their deductions 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 you ran payroll for the pay period.
Change contributions or policy settings
Contact Betterment to change any of your company’s policy settings.
Important: 401(k) plan policies do not allow changing the company match for a specific payroll. You cannot block the company match on any payroll. This includes off-cycle payrolls.
Handle loans
If your plan allows loans, employees can contact Betterment to apply. Once the employee reaches the repayment stage, Betterment notifies them with instructions. If Betterment collects the repayment through payroll deductions, the employee will see post-tax loan deductions on their paystubs. Check the terms of your loan or contact Betterment to confirm your repayment method.
Fix payroll data not syncing to Gusto
For payroll data to sync, you need to set Gusto as your payroll provider in Betterment. If you changed your payroll provider since starting your 401(k), contact Betterment to update it.
Handle employee dismissals
When you dismiss an employee, their dismissal date syncs to Betterment. The employee will get steps to roll over their 401(k) to another provider or keep it with Betterment. Dismissal payrolls include regular 401(k) contributions.
Note: We do not deduct 401(k) contributions from severance payments. You must use the Gusto-provided severance earnings type. This automatically blocks deductions and contributions for severance payments.
If your plan allows participants to request loans or distributions, you may get an email asking you to approve them through the Betterment dashboard. Click the link in the email or log in to your Betterment dashboard to manage requests.
To approve or reject loan and distribution requests:
In the left menu, click Tasks.
Click either Pending loan requests or Pending distribution requests.
Choose the pending request you want to review.
Select either Approve loan or Reject loan.
Betterment will email the employee an update with the next steps. After 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 will see post-tax loan deductions on their paystubs.
Q: Why was my employee’s paycheck missing 401(k) benefits?
A: Go to the Troubleshoot missing payroll deductions section of the article for more information.
Q: I have a question about a notification in my Betterment portal. Who should I contact?
A: Contact Betterment for help with notifications in your Betterment portal.
Q: I have a question about an employee’s enrollment or election synced to Gusto. Who should I contact?
A: Contact Betterment for help with employee enrollment or elections.
Q: I have a question about plan funds. Who should I contact?
A: Contact Betterment to discuss plan funds or debits.
Gusto and Betterment work together to help you manage your plan. Here’s who to contact for different questions.
When to contact Gusto
Contact Gusto for questions about:
401(k) calculations on payroll
Why we did not apply 401(k) deductions
Payroll corrections with Betterment 401(k)
Examples:
“How did Gusto calculate my employee’s 401(k) deduction?”
“Why were there no deductions on my employee’s check?”
“My employee was overpaid. I need to reverse their payroll.”
When to contact Betterment
Contact Betterment for questions about:
Your 401(k) plan
Syncing benefits to Gusto
Payrolls syncing to your 401(k) plan
Plan funds, including debits
Employee eligibility
Changes to your 401(k) plan
Examples:
“When does our plan begin?”
“Our company set up a new Betterment plan. When will our benefits show 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 did Betterment debit this amount for 401(k) funds?”
“When can my new hire enroll?”
“I want to update the employer match.”
“When will this payroll sync to Betterment?”
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]
1 Paid non-client of Betterment. Views may not be representative; see more reviews at G2. Learn more about Gusto’s relationship with Betterment.