Nerdwallet’s Rating of Acorns
Nerdwallet’s acorns editors rate online brokers and robo-advisors based on account fees and minimums, investment options, customer support, and mobile app features. Acorns is a popular investing app that lets you automatically invest your spare change from purchases made with a linked card.
You can also earn bonus investments with Acorns Found Money, a rewards program that’s similar to a cashback credit card. This is a feature that most competitors don’t offer.
No minimum deposit
Acorns is an investment app that helps users manage their money with its’micro-investing’ feature. It rounds up purchases made on linked debit and credit cards, and tucks the change away into an account that invests it in a diversified portfolio of ETFs. It also acts as a robo-advisor, managing the portfolio on behalf of the user. It has a zero minimum deposit to open an account, and the service begins investing once you have accumulated at least $5 in round-ups.
Like other robo-advisors, Acorns takes the reins of your investments by considering your goals, income, and time horizon. The app then recommends a portfolio that reflects your risk tolerance. You can choose to accept the recommended portfolio, or opt for a different one with greater or lesser risk.
In addition to its automated investment services, Acorns also offers banking accounts that earn 3% APY and savings accounts with 4.85% APY. These accounts are insured by the FDIC and allow customers to deposit cheques, and withdraw funds at more than 55,000 fee-free ATMs. Customers can also access customer support via live chat, phone, and email.
Acorns has partnered with more than 450 companies to offer its customers cash back. The service uses a Google Chrome and iOS Safari browser extension to track purchases and reward users automatically. Its mobile app offers a variety of other features, including the ability to set savings goals and track spending. Its website also includes helpful articles and videos on personal finance topics.
No minimum balance
The no minimum balance option is an excellent feature for new investors who want to get started with a robo-advisor. It gives users the freedom to choose a savings goal, including large purchases such as houses and vehicles. They can also save for retirement, and can set a daily or weekly deposit amount. The service also offers a free Chrome extension that allows you to earn bonus investments while shopping online.
Unlike many of its competitors, Acorns doesn’t charge an annual fee. Instead, it charges a monthly fee that starts at $3 per month. The fee can significantly cut into your investment returns, especially at small account balances. In addition, Acorns does not have a comprehensive tax strategy.
The Acorns app automatically invests your “spare change” with each purchase you make on a linked debit or credit card. This spare change is transferred to a diversified portfolio, which the app manages like a robo-advisor. The app is available for both iOS and Android devices, and investing can take place in real time.
The Acorns IRA offers a traditional, Roth, or SEP IRA plan based on your answers to a simple suitability questionnaire. You can also choose a Smart Deposit, which will automatically invest a percentage of your paycheck into your Acorns Invest or Later accounts. The service also offers a 1% or 3% IRA match for Silver and Gold members, respectively.
Acorns NerdWallet Review
No fees
Acorns is an app that lets users save spare change by automatically investing the change from purchases made using a linked bank account. The company monitors the account and invests it in exchange-traded funds based on the amount of change accumulated each day. Its no-minimum investment is a selling point, though Nerd Wallet found its management fees and accounts fee to be slightly higher than competitors.
The service charges $1 a month for an individual account and has additional costs for accounts with high balances. This compares to 0.25% per year for Betterment and Wealthfront. Acorns also offers a savings feature with partner companies such as Hulu, Airbnb, and Blue Apron that gives users a percentage of their purchases back to the app.
In addition to its core portfolio, Acorns has a sustainable investment option that uses ETFs screened for environmental, social, and governance (ESG) criteria. It also offers IRA accounts for individuals and families, including Roth, traditional, and SEP IRAs.
Acorns has a range of subscription tiers, starting at $3 a month. Its subscription fees are waived for college students. It also offers a custodial account for children, which can be used as an emergency fund or to help them build their financial skills. It also has a feature that allows you to create a budget.
No minimum investment
Unlike Betterment and Wealthfront, which have minimum investments of $100,000, Acorns allows users to invest with as little as $5. Its microsavings feature rounds up purchases to the nearest dollar and automatically invests the extra change in an investment portfolio. It also allows investors to set up automatic, recurring investments every day, week, or month. Acorns also offers a sustainability portfolio, which includes ETFs that are screened for environmental, social, and governance criteria.
The app’s robo-advisor service, Acorns Invest, offers expert-built, diversified portfolios based on your money goals and risk tolerance. Its core plan costs $3 per month, while its Silver and Gold plans charge $6 or $12 a month. The service’s IRA account options include Roth, traditional, and SEP IRAs, as well as an UTMA/UGMA custodial accounts for children.
In a recent review, Investor Junkie called Acorns “one of the best microsavings services available.” The app’s no minimum deposit requirement and its ability to provide ongoing financial guidance make it a good choice for people who want to start investing without having to spend too much time or effort. However, the app’s high fees can eat into your return on investment.
In addition to a no-minimum investment option, Acorns allows you to connect several different bank accounts and earn from its partners when you make purchases using a linked card. The company’s Acorns Earn program offers retailer kickbacks and a 2% cash back bonus on qualifying purchases.
