Acorns Investing: Scam Or Legitimate Investment Opportunity?

Acorns is a micro-investment platform that can be downloaded from the Google Play Store or Apple App Store. It is a legitimate company that has been featured in Forbes, ABC News, WIRED, and CNN Tech. It was founded in 2012 by a father and son team, Jeff and Walter Cruttenden, and has had 2 million downloads since its launch.

Acorns is an automated app that rounds up your purchases to the nearest dollar and invests the spare change. It also allows users to set up recurring investments and make unlimited withdrawals. The app is free to download, but there is a monthly fee of $1 for balances below $5,000 and a fee of 0.25% per year for balances of $5,000 or more.

Acorns has received positive reviews for its ease of use and ability to help people save and invest without much effort. However, there have been some complaints about issues with signing up, rounding up purchases, and a lack of response from customer service. Overall, Acorns appears to be a legitimate and safe way to save and invest, but it is important to understand the fees and how the app works before signing up.

How does Acorns work?

Acorns is a micro-investing app that allows users to invest small amounts of money at a time. It is designed for novice investors who want to get their feet wet in the stock market. The app offers a robo-advisor platform, tax-advantaged IRAs for retirement, and a checking account. Its main feature, Round-Ups®, allows users to invest their spare change from everyday purchases. For example, if you buy a coffee for $2.75, Acorns will round up to $3.00 and automatically invest $0.25.

Acorns offers different subscription tiers, with the basic plan starting at $3 per month. There are no account minimums, and you can get started with just $5 and your spare change. Acorns will then recommend an expert-built, diversified portfolio based on your money goals and risk tolerance.

Acorns offers several types of accounts, including:

• Acorns Invest – Personal investing account
• Acorns Later – Retirement Account
• Acorns Checking – All-digital banking
• Acorns Early – Investment account for kids

The app also provides additional features such as Round-Ups®, which automatically invests your spare change, and Recurring Investments, which allow you to set up automated contributions.

Acorns is built on the principles of micro-investing, allowing users to start early and invest often without making big changes to their everyday lives. The app aims to make investing accessible, simple, and easy, particularly for those who are new to investing.

Is Acorns a scam?

Acorns is a micro-investing app that lets people automatically invest their spare change by rounding up the purchases they make with a linked credit or debit card. The app is legitimate and not a scam. It is currently valued at $860 million and has over 5 million users.

Acorns is a good option for beginners interested in micro-investing and building a diversified portfolio of stock and bond ETFs. It offers a hands-off experience from start to finish while considering financial goals, risk tolerance, and time horizon.

However, Acorns' investment selection is limited to ETFs and doesn't offer tax-loss harvesting. So, if you're interested in a broader range of investments or more advanced tools and features, other apps may be a better option.

Acorns has three subscription plans with monthly fees of $3, $6, and $12, which offer varying features such as IRA accounts, custodial accounts, and checking accounts. The app also provides impressive high-yield checking and savings accounts with competitive interest rates.

While Acorns is legitimate, there have been some complaints and concerns raised by users. Some issues include difficulty signing up, problems with the rounding-up feature, lack of response from customer service, and high fees on small balances due to the flat monthly fee structure.

Overall, Acorns can be a useful tool for beginners interested in micro-investing and those who want an easy way to save and invest their spare change. However, it may not be the best option for more experienced investors seeking a broader range of investment options and advanced features.

Acorns fees

Acorns is a micro-investing app that charges a flat monthly fee for its services. The fee is determined by the subscription tier, which varies depending on the features you want to use. The fees are as follows:

• Acorns Bronze: $3 per month
• Acorns Silver: $6 per month
• Acorns Gold: $12 per month

The basic Acorns Bronze subscription gives you access to investment portfolios, banking features, and bonus investments when you shop at partnered brands.

Acorns Silver offers additional features such as an emergency fund, bonus Acorn matches of up to 25% on your contributions, and access to live expert Q&As.

Acorns Gold includes all the features of the previous tiers, plus Acorns Early (custodial accounts for kids), the ability to add individual stocks and ETFs to your portfolio, a $10,000 life insurance policy, and educational courses.

It's worth noting that Acorns does not charge a management fee or commissions on trades. However, the monthly fees can be relatively high compared to other investment apps, especially for small account balances.

Other Costs to Consider

While Acorns does not charge a fee for withdrawing your money, it's important to keep in mind that there may be tax implications when you withdraw funds, depending on your location and tax status.

Additionally, if you opt for the Acorns debit card, there may be ATM fees for using out-of-network machines.

Whether Acorns is worth the cost depends on your individual needs and investment goals. The app is designed for beginners and passive investors who want a simple, automated way to invest their money. If you struggle to save and invest consistently, the Round-Ups feature can be a useful tool to help you build your investment portfolio over time.

However, if you have a larger account balance or prefer more flexibility and investment options, you may find that other investment platforms offer better value for your money. It's essential to compare the features and fees of different investment apps to determine which one best suits your needs.

Acorns pros and cons

Acorns is a micro-investing app that allows users to invest their spare change by rounding up purchases made with a linked credit or debit card. It is a legitimate money app software that is well-financed and backed by some big-name investors. It is also insured by SIPC, the investing and brokerage world's equivalent of FDIC insurance. While it is not a scam, it is important to understand the pros and cons of using Acorns before investing.

Pros

• Low minimum to get started: There is no minimum to open an account, and you only need $5 to start investing.
• Easy to use: Acorns is designed to be mobile-first and has an easy-to-use interface, making it simple for beginners to navigate.
• Automatic saving and investing tools: Acorns offers a unique "round-up" feature that allows you to invest your spare change. You can also set up recurring deposits and take advantage of cash-back rewards.
• Personalized, diverse ETF portfolios: Acorns offers a range of portfolios based on your risk tolerance and financial goals. You can also add a Bitcoin-linked ETF to your portfolio.
• No account minimum: There are no minimums to set up an Acorns account, making it accessible to those with lower balances.
• Educational content: Acorns provides educational videos, tips, and courses to help investors grow their knowledge.
• High-yield checking and savings accounts: Acorns offers impressive high-yield checking and savings accounts with competitive interest rates and no minimum balance requirements.

Cons

• Fees: Acorns charges a flat monthly fee of $3, $6, or $12, depending on the plan you choose. This can be expensive for small account balances, especially if you are only contributing through round-ups.
• Limited investment selection: Acorns offers a limited range of investment options, primarily ETFs, and does not allow direct investment in Bitcoin or other cryptocurrencies.
• No tax-loss harvesting: Acorns does not offer tax-loss harvesting, which can reduce the amount of tax you pay after selling investments.
• No access to human advisors: Acorns does not provide access to financial advisors, which may be a drawback for some investors.
• High fees for fund transfers: Acorns charges a steep fee of $35 per ETF to transfer funds to another broker when you close your taxable account.

Acorns vs other investment apps

Acorns is a micro-investing app that allows users to invest their spare change. It is a legitimate app that is backed by big-name investors and endorsed by celebrities such as Ashton Kutcher and Dwayne Johnson. It is a secure, modern investment app with competitively priced trades and a user-friendly interface.

Acorns is ideal for beginners and passive investors who want a simple, mobile-first platform to build a diversified portfolio. It offers a hands-off experience, automatically investing spare change from linked credit or debit cards once it reaches $5. The app has a low minimum of $5 to start investing and charges a flat monthly fee of $1, $3, $6 or $12, depending on the subscription tier.

However, Acorns has limited investment options and strategies compared to other apps, and the monthly fee can be significant for small balances. Here is how it compares to some other investment apps:

• Stash Invest: Stash offers a similar service to Acorns, with automated investing and round-ups. However, Stash also allows users to trade on their own, offering access to stocks, ETFs, and cryptocurrencies. Stash has a monthly fee of $3 or $9, depending on the plan.
• Robinhood: Robinhood caters to active traders and offers a wider range of investment options, including stocks, ETFs, options, cryptocurrencies, IPOs, and ADRs. It does not charge commissions on investments and has a $5 monthly fee for its Robinhood Gold service.
• SoFi: SoFi offers both automated and DIY investing. The DIY option allows users to trade stocks and ETFs with no commission fee and access to fractional shares. SoFi also provides access to human advisors and has no fees on automated accounts.
• Betterment: Betterment is an all-in-one personal finance app offering banking, investing, and retirement planning. It uses low-cost ETFs and charges an annual fee of 0.25% of assets under management.
• Wealthfront: Wealthfront is another robo-advisor with a minimum balance of $500 and no account fees for the first $10,000.
• M1 Finance: M1 Finance is a "super app" offering investing, borrowing, saving, and spending features. It provides automated and DIY investing options and allows users to create their own portfolios with any stock or ETF.
• Public.com: Public.com is a free platform offering commission-free trading in stocks, ETFs, and cryptocurrencies. It has a social aspect, allowing users to follow other traders and see their trades.
• Qapital: Qapital is a personal finance app with automated investing and budgeting tools. It has a rule-based system that allows users to set up creative rules for their investments and savings.
• Webull: Webull is an investment app for beginners and experts, offering extended trading hours, paper trading, custom screeners, and technical indicators and charting tools. It has no minimum investment requirement and does not charge trading commissions.

Acorns is a good option for beginners who want a simple, automated way to invest their spare change. However, for those seeking greater flexibility, more investment options, or lower fees, there are several alternative apps to consider.

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