Acorns is a company committed to every aspect of investing. The company uses professionals from a range of industries to help influence all investment decisions. Financiers, as well as the best mathematicians, work with Acorns to diversify each portfolio.
Acorns is a very different setup that traditional investment firms, so it does take a little getting used to. However, it is a great way to automate savings since Acorns helps you save ‘spare change' in a sense by rounding up purchases made on linked debit and credit cards and moves the savings to your investment portfolio. Check out our thoughts on the platform.
Getting Started
Opening an account with Acorns is fairly consistent with other companies in the field. An easy to navigate sign up process welcomes investors to the company. New users will need a credit card or debit card as well as a currently open checking account. After verification, the Acorns team will begin setting up a portfolio for investors. Keep in mind that while it costs nothing to open an account, $5 is required to start investing.
Enrollment
The site has several requirements for new accounts. Users must be US residents that are over 18 years old. Any members of the military with US addresses that are out of the country during tours of duty are accepted.
Quick Deposit Options
Acorns prides itself on quick deposit options that make it easy to reinvest or add funds for those special stock purchases. Credit cards, as well as PayPal accounts, may be used to handle all deposits. The recurring deposit feature allows users to set up regular payments at scheduled intervals. A rounding up program takes spare change from an account holder's other purchases or bills to establish subtle deposits that add up over time.
ETFs
All portfolios are invested in exchange-trade funds or ETFs. Six carefully chosen ETFs are used to make up a portfolio. These funds are traded much like stocks and consist of stocks, bond, and commodities.
Apps
Acorns realizes that technology is at the forefront of modern investments. That's why the company gives users the chance to control and monitor their accounts through an easy-to-use app. According to Fortune, this feature is helping younger users becomes investors. “Of Acorns’ 650,000 registered customers, 75% are under the age of 35.” This app features a wide range of selections that cover everything an account holder would need. Information used on the app is stored and users can be assured that every detail is safe if any issues occur.
No Minimums or Commissions
Unlike some online investment companies, there are no minimum investments to qualify for Acorns' services. Commissions are also not assessed to any transaction. That means fewer worries about advice from the site's staff of professionals.
Remember, the goal of Acorns is to build wealth using spare change. So it makes sense there are no account minimums.
Referrals
Referrals are accepted for this company. Users who refer a new investor must present their personal invitation goal to receive rewards. The rewards can be up to $100 a year and are paid after new users complete their applications.
Fees
This service charges set fees for monthly and yearly use. As of 2017, accounts with a balance of under $5,000 dollars are assessed a fee of $1 while those over $5000 are charged .25% of their total balance. Students that can prove they are enrolled in a college or university may invest for free. All users also receive free withdrawals on their account.
It's important to note that these fees can get pretty expensive as a percentage of your account. Really focus on building your portfolio to minimize the bite that these fees have.
A Great Choice for First Time Investors
Acorns provides a great start for first-time investors. Their easy-to-use features and straight forward approach to investments make new investors comfortable about stepping into the world of stocks and bonds. Anyone with a limited income may also benefit from this service. The lack of minimum deposits and account balances helps anyone with a small amount of funds become an investor.
However, the percentage fees are a real downside to investing with Acorns and can seriously eat away your returns over time.
See how Acorns compares to other investing firms using our Online Stock Broker Comparison Tool.
Acorns
Pros
- Free for college students
- Helps you invest with pocket change
- $1/month for accounts under $5,000
Cons
- 0.25% for accounts of $5,000 or more
- No tax strategy advice available
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I started using Acorns last year. I like this app. My current total investment is just under $500. This is a fantastic amount of money, considering I don’t even realize the money missing from my checking account.
That’s awesome – such a great start to building a nest egg.
This sounds like a great way for folks just getting started with investing to dip their toe in the water. I like that you can get started with no minimum!
Yes, I think high minimums are a roadblock to many people. Not having to worry about that is huge.