Oct 31, 2022
Acorns Review 2022: How To Invest With Little Money In 2022.
Making Boring Passive Income
The Acorns app makes it easy to save and invest small amounts of money. When you link a credit or debit card, Acorns rounds up your purchases to the nearest dollar and invests the difference.
Side Note: You Get $5 For Signing Up
In this Acorns review, we’ll explain how it works, what the potential savings and risks are, and help you decide if it’s a good way to invest your money.
Remember your childhood piggy bank or loose change jar? How Would You Drop All Your Nickels, Dimes, and Quarters In There Until It Was Full?
If you’re like me, every time you took that change to the bank, it added up to more money than you thought.
Acorns wants to take this “out of sight, out of mind” method of saving to the next level. They round up your expenses to the nearest dollar and then invest your nickels and dimes for future goals.
The company recently added savings accounts for retirement, a debit card account, and a $10 sign-up bonus.
But can this strategy for small investments really help you get rich? Let’s Take A Look.
Acorns is a mix of a piggy bank and a robot advisor. This app rounds up your purchases on linked credit or debit cards to the nearest dollar and invests that money for you. You can now choose to increase those round-ups by 2, 5, or 10 times.
How do Acorns work?
Most other Robo-Advisors also use Dr. Harry Markowitz’s Modern Portfolio Theory as the basis for their investing services. It lets you choose from five optimized portfolios and automatically rebalances your portfolio and puts all dividend payments back into it on a regular basis.
Exchange Traded Funds, or ETFs for short, make up each Acorns portfolio. These funds put their money into many different types of assets. Over Time, The Costs Of Running These ETFs Add Up To About 0.1% Of Your Investment.
Acorns Will Invest The Money You Add To Your Account Through Round-Ups Or Scheduled Deposits Based On Your Risk Profile. If You Have The Basic Acorns Account, This Will Happen In An Investment Account That You Have To Pay Taxes On.
You Can Get Your Money Out Of Acorns At Any Time, But It Can Take 5 To 7 Business Days For Investments. And The Truth Is, You Don’t Want To Use Your Acorns Savings As A Regular Source Of Cash.
Investing Is A Game Of The Long Term. Using Money From This Account For Day-To-Day Expenses And Goals Will Make It More Likely That You’ll Lose Money In The Market.
Acorns Gives Users 2 Ways To Pick The Plan That Is Best From Them.
>> Sign Up For Acorns. And Get $5
Acorns Pricing:
Acorns Pricing Is Very reasonable When It Comes To Having A Financial App That Invest For You, Out Of Site Out Of Mind.
Acorns Pricing: Personal $3/month
All-In-One Investment, Retirement, And Checking Account, Plus A Metal Acorns VisaTM Debit Card, Bonus Investments, Financial Education, And More.
Acorns Investing:
Acorns puts investing on autopilot. You can sign up in minutes, and we’ll help you choose an investment portfolio based on how much money you want to make and what you want to do with it.
Exchange Traded Funds, or ETFs, are part of the portfolios that Acorn’s experts put together. They are like baskets of different investments, such as stocks and/or bonds, and have benefits such as diversification, lower costs, and the chance to save money on taxes.
When you invest in Acorns ETF portfolios, there’s a good chance that some of your money is in Apple, Amazon, Google, Berkshire Hathaway, and other of the world’s biggest and most successful companies.
Acorns Review: Questions Often Asked
Investors have questions because they have so many options to choose from. Here are the most-asked questions about Acorns that we’d like to answer in our review.
How Much Do Small Round-Up Investments Matter?
When it comes to putting money away for the future, every little bit helps.
Should round-up investments be the main part of your investment plan, though? No.
But even if you invest $30 a month and get a 7% return on the market, you’ll have more than $4,900 after 10 years. If you put the same amount of money into an online savings or money market account, you’d have just under $3,900. And as time goes on, the difference between investing and saving will only get bigger. That’s the power of growth that adds to itself.
What does it cost to use Acorns?
Acorns has two different plans:
Personal $3 per month for a family, and $5 per month for an individual.
Webull, which is a trading platform, is another app I would highly recommend.
Does investing with Acorns come with any risks?
Performance is not a given, just like with any other investment. Investing involves risks, which means that your portfolio’s value can go up and down over time. Even though the S&P 500 has consistently given returns of about 8% per year, changes from year to year could cause your account to lose a lot of value, sometimes as much as 10% or more.
People who use Acorns risk the most if they stop putting money into their account and keep it small. Remember that the monthly fee has a bigger impact on your overall account balance the less money you have in your account.
Instead, if you want to use your money in the next three to five years, choose a high-interest savings account.
Can I use Acorns to invest large amounts of money?
Flat-rate fees may look good to investors who don’t want to do much and have a lot of money to spend. For example, if you have over $10,000 to invest in the Invest + Later membership level and your fees drop below the levels of top Robo-Advisor competitors like Betterment and Wealthfront, Acorns seems like a cost-effective choice.
But I still wouldn’t suggest putting a lot of money into Acorns. They can’t invest in as many ways as the bigger players can. Portfolios have less variety in the types of assets they hold, and asset allocation can’t be changed outside of the five key portfolios.
Also, if you mostly invest in a taxed account (the basic level of Acorns), you don’t get the tax-loss harvesting that many competitors offer to improve long-term returns.
Lastly, you can’t get professional help with your money through Acorns. Larger Robo-Advisors give you access to Certified Financial Planners (CFPs) who can answer your most important questions. You might not have any right now, but if your portfolio grows or if the market goes down, it can be a comforting choice.
Brief Review of the Acorns App
Acorns is one of the best apps for investing small amounts of money at once. It is easy to use, has a great way for new investors to learn, and has fees that are easy to understand.
But whether the $3–$5 monthly fee is good or bad depends on how much money you have in your account. If you only put a few dollars into your Acorns account every month, that $1 a month will slow the growth of your investment.
