Investing the change with Acorns
If you’ve ever had to nod along while your friends talked about Acorns, this blog is for you. It’s also for you if you have never done any investing but you’re interested in trying it out.
You should think about managing and growing your money as a competition. Sometimes you are competing against the opposition that wants to take your money. Sometimes it’s a friendly competition to do better than people you know. Sometimes you are competing against yourself to save rather than spend. This is the mindset that is going to drive results.
Acorns can help you beat yourself by investing what you would have otherwise spent. It can also help you beat the opposition by giving you a greater return on your money than they might have given you. If you’re intrigued, here is what you need to know.
What is Acorns?
Picture every purchase you make rounding to the next whole dollar in a savings account. This is typically called a ‘save the change’ program. Next, think about robo-advisors. These companies provide digital financial advice using algorithms with minimal human intervention. Now, imagine those 2 had a baby. That baby would be Acorns.
How does Acorns work? It’s pretty simple, and that’s what makes it good. You either go to the website or download the app and answer a few questions about yourself. This is how they recommend one of five diversified portfolio options. You finish up by linking your accounts and telling them how much you want to invest. Linking your accounts couldn’t be easier. You select your bank or credit card and log in like you normally would at that site. You can start with as little as a $5 deposit, and decide if that’s for one time or a recurring transfer. From there, Acorns will round up each purchase you make and invest the difference. You can withdraw your money at any time free of charge.
How much does Acorns cost?
If you deposit less than $5K, it costs $1 a month. If you decide to go bigger with more than $5K, they will charge you an annual fee of 0.25% of your invested balance. What’s great about Acorns is if you are under 24 or have a valid .edu email address, it costs you nothing at all.
If you deposit less than $5K, it costs $1 a month. If you decide to go bigger with more than $5K, they will charge you an annual fee of 0.25% of your invested balance. What’s great about Acorns is if you are under 24 or have a valid .edu email address, it costs you nothing at all.
Is Acorns the wrong choice for you?
There are several reasons why it might be. If you want a lot of options to invest in, there are only 5 portfolios that span from conservative to aggressive. There are also only 6 asset classes. While their fee seems low, when you compare it to how much you are going to make, there isn’t much special about it.
Is Acorns the right choice for you?
If you haven’t started investing yet but growing your net worth is important, Acorns is for you. You aren’t going to get rich quick or anything, but you will get 2 major benefits by joining up. You’re going to build money separate from daily spending accounts without realizing it. More importantly, you are going to get your first taste of investing. The earlier you start doing that, the more significant your net worth is going to be in the future. You may also want to join Acorns if you like to keep a finger on the pulse of disruptive FinTech.