07 Dec

TD Ameritrade Review – Holds Up To The Competition

td ameritrade review

You might have heard mumblings of how your coworker lost or gained a fortune from trading stocks, but have you ever considered that you might be able to dip your toe into trading as well? Brokers like TD Ameritrade make it easy for you to start trading and learning more about the stock market using a comprehensive set of tools.

What Is TD Ameritrade?

TD Ameritrade is an Omaha based brokerage firm. The TD in TD Ameritrade stands for Toronto-Dominion Bank, which is the firm's largest shareholder. TD Ameritrade specializes in providing services for individuals and institutions that invest online.

Target Investors

The world of investing can be daunting for anyone that’s not well versed in how everything works. Fortunately, that’s where TD Ameritrade comes in. It’s a perfect fit for long term investors and active traders. The firm offers constant professional guidance through phone, email, online, and in person communication methods.

Additionally, you TD Ameritrade customers are given access to multiple tools, research insights, and educational videos and courses that can help with filling in any gaps in your investment knowledge.  

Account Minimum

TD Ameritrade does not require a minimum amount of money to open a new account with them. However, they do need a $2,000 deposit so that you can qualify for margin and options privileges, even if you're taking advantage of a promotional offer.

Commission Fees & Other Costs

TD Ameritrade has very reasonable commission fees so that you can trade through their firm. The commission fees are as follows:

  • For Internet trades: $6.95 and an additional $0.75 fee per contract.
  • Options exercised and assignments: $19.99
  • Interactive Voice Response Phone System: $34.99 and an additional $0.75
    fee per contract.
  • Broker-assisted trades: $44.99 and an additional $0.75 per contract.
  • A fee of $49.99 for no-load mutual funds.

There are other costs included in TD Ameritrade’s services including:

  • A $25 fee for bonds.
  • Futures trading carries a $2.25 fee per contract.
  • Certificate Withdrawal Delivery fee of $500.
  • An outbound full account transfer fee of $75.
  • A $25 fee for domestic and international wire transfers.

Trading Platforms and Usability

TD Ameritrade offers many different trading platforms for their customers to use.

Web Platforms

TD Ameritrade recommends this platform for investors of all skill levels. You can pull trading insights from Twitter using social signals, as well as track social sentiments. Additionally, in the customizable dock for TD Ameritrade’s web platform, you can learn valuable stock information that’s generated by Yahoo! Finance. Investors are also given access educational resources, planning tools, and third-party research.

Trade Architect

TD Ameritrade offers this trading platform for active traders who might like to utilize customizable, interactive charts made by as well as identify stock trends with options screeners and independent research.

The Trade Architect platform has an added perk of being able to stream live news from CNBC so that you can stay in the loop.

thinkorswim

This professional level trading platform is designed for serious traders. It comes equipped with technology that can monitor your potential risk/reward ratio, elite tools that perform analyses and test strategies and onboarding tools. The onboarding tools will be a great buy for any serious trader that wants to get started quickly, the thick Manual and Swim Lessons tools.

Mobile Trading

TD Ameritrade is putting maximum usability first, as there are plenty of mobile tools that a novice or expert trader can utilize. From one of TD Ameritrade’s optimized apps, traders can manage their current investments and seize new trading opportunities. TD Ameritrade has the added advantage of having the number one trading app in the app store.

General Tools

TD Ameritrade is equipped with additional tools to allow their traders, regardless of their skill level, to get the most out of their investment with the brokerage firm.

Heatmaps

TD Ameritrade has been careful to consider the wants of all types of investors. There are some investors that are attracted to the prospect of investing in semiconductors. Semiconductors are small but powerful building blocks that are used in the creation of automobiles, smartphones, computers, and industrial equipment.

In the thinkorswim platform, TD Ameritrade gives traders the option to use a heat map that will reflect a graphic of semiconductor companies. The size of the square used on the heat map will inform the trader of the company’s market cap, and the color will reflect the company’s price movement.

Integrated Watch Lists

If you use the web platform on TD Ameritrade's website, you can create a personal watch list. TD Ameritrade's advanced technology will be able to let you view real-time updates and stats about the trade option's that have piqued your interest. There's a bonus in the watch list feature; you can view earnings estimates, news, charts, and fundamental research on stocks that you've added to the list.

Live-Streaming CNBC

Want to be kept up to date on current stock trends? TD Ameritrade allows you to live stream CNBC through the thinkorswim platform. If you're a seasoned trader, you'll want to consider learning more about the platform. Traders with the thinkorswim tool will be able to keep up with breaking news regarding business news, stock market trends, and investment information.

myTrade Community

The myTrade Community tool is a valuable asset for traders that are new to investing. When a trader utilizes the myTrade Community tool, they’re able to get insight generation from professionals in the investment community, as well as share ideas with other traders that use TD Ameritrade for their investments.

Idea Generation

TD Ameritrade wants to help you find your next lead. The brokerage firm will provide tools that and valuable research that can help you narrow down what you might like your next investment opportunity to be.

Education & Research Tools  

TD Ameritrade is equipped with several education and research tools that will help traders of all skill levels with their investments.

Education

TD Ameritrade has an Education Center so that their customers will always be equipped with knowledge that can help them succeed in trading and investing.

The Education Center houses a few subcategories that will help traders select a learning curriculum that caters to their current interests and current investment knowledge. The learning curriculums are split into three categories like Rookie, Scholar, or Guru Essentials. However, you can always search TD Ameritrade’s videos and create your own curriculum to aid you in your trading.

TD Ameritrade allows you to take some of their educational videos for a test drive, head over to their website if you're interested in viewing their videos on investing basics, retirement planning, saving for college, a glossary of trading terms, and account types.

Third-Party Research

TD Ameritrade gives their traders the option to use third-party research to assist them throughout the trading process. TD Ameritrade believes that if their traders are armed with as much information as possible, that they will be more successful in the long run. You can obtain vital trading information from some of their third-party research tools like CFRA Columns, CFRA Portfolios, Market Edge, and reports from Research Team Company Reports.

Market Edge

Stay in the loop with Market Edge. You'll receive weekly and easy to read reports that detail analysis' of the stock market. The program also offers you thorough market commentary that can assist you with evaluating your trade strategies for the current and future market.

ETF Market Center

ETFs are exchange-traded funds. Exchange trade funds are baskets of securities that trade like the stocks that you would see on an exchange. In the ETF Market Center, you can narrow down your search for investments by industry, (healthcare, industrials, real estate, technology, utilities, energy, financial services, and more) invest in global and emerging markets, and identify ETFs with a specific stock.

Social Signals

Social signals is a trading tool that TD Ameritrade offers that will save you any time that you may have spent investigating product trends on social media. Social signals gather insights from Twitter to help you find new investment opportunities. The social signals tools then gather all of these in once place.

Stocks Overview

The stocks overview tool helps you locate stocks that might pique your interest. You can use this tool to see which stocks are high and low, what's moving, and it allows you to see what's trending on social media and keep up with stock related news.

Stocks Charts

Using customizable charts, you can set the parameters on the tool to help you find trends that and opportunities that suit your investment strategy.

Screeners

TD Ameritrade offers screeners that are filters to help you invest in or follow a trade. You can search for mutual funds, ETFs, stocks, and options using filters like lifecycle, lowest expense ratio, highest alpha, strong buys, and more.

Premier List

You can identify the best mutual funds using the Premier List tool. The Premier List tool is an unbiased, third-party tool that allows you to search for no transaction fee funds that cover over 45 different categories. This list is redone on a quarterly basis and is created by trade experts at Morningstar Investment Management LLC.

CD Center

TD Ameritrade's CD center offers you some tools that can help you research the right CD for you, and view TD Ameritrade's brokered CDs, which offer many choices at very competitive rates.

Bond Wizard

The Bond Wizard can help you find bonds and CDs that can assist you in meeting your long term investment goals. The Bond Wizard works by asking you a few questions and generating a list of potential investment options based on your answer.

Market Java

You’ll be able to sit down with a cup of coffee and the most recent market updates with the daily morning-report. TD Ameritrade has made it so that you’ll be able to keep up with significant changes in the stock market, market conditions, and how the stock market has done internationally while you were sleeping.

Account Types

To best suit your needs and long term goals for investing, TD Ameritrade wants to help you find the right account type for your investments.

Standards

You can have a standard account that gives you access to objective research, comprehensive investment products, and trading platforms. You can have a joint standard account or an individual one, and TD Ameritrade gives you the option to upgrade for forex trading, futures, and options.

Retirements

Traders that are hoping to have a sizable retirement account have the options of choosing from a Rollover IRA, Traditional IRA, or Roth IRA. There are several tax advantages to this kind of account, and TD Ameritrade promises to work with you to find the right method to aid you in your retirement planning.

Specialty

If your financial needs are a bit broader, TD Ameritrade recommends a specialty account to help you address your plans for your financial future. Specialty accounts include pension plans, business partnerships, and individual trusts.

Managed Portfolios

TD Ameritrade offers a set of professionally managed portfolios that can help you save time and pursue your long term financial goals regardless of whether or not they change over the years.

Margin Trading

Traders can borrow money from TD Ameritrade with this account so that they can increase their securities' buying power up to 50%. If you're hoping to elevate your trading status, this is one way to get there.

Quality Of Their Customer Service

TD Ameritrade is making a strong effort to stress that they take your business and your investments very seriously. They’ve made it a point to be available to answer any questions that you may have whenever you need. You can call or email TD Ameritrade on a 24-hour basis, or you can visit a branch.

You can find a branch location near you by searching for one in your zip code on the TD Ameritrade website.

Shortcomings Of TD Ameritrade

TD Ameritrade offers a lot of perks to their customers, but they do fall short compared to the competition in some areas. For example, their flat fee of $6.99 per trade is more expensive compared to other online brokerages. Additionally, the $44.99 and the $49.99 fees on no-load mutual fund trades when you're assisted by one of their brokers are still more expensive than average.

Lastly, the full range of apps and tools can be overwhelming for new customers. Since TD Ameritrade tries to appeal to traders of all skill levels, the apps and extra research tool could leave customers confused as to where they fit in.

Is It The Right Choice?

Are you a seasoned investor? Or are you just hoping to get started with building your investments? If you're an experienced investor, TD Ameritrade is going to be a better fit for you because you'll have a better idea of how to properly utilize the additional research tools, analytical tools, and exclusive features.

New investors might have trouble navigating everything that comes with TD Ameritrade’s programs, as well paying for TD Ameritrade’s trade fees since they have yet to make any money from their investments.

07 Dec

LearnVest Review: Great Money Management Plan?

learnvest review

Planning your financial future can be a daunting and challenging task. Most of us don't even like to talk about money for too long, much less sit down and ponder how much or how little money we might have in the future.

Additionally, meeting with a financial planner can come with a hefty price tag, but this doesn't mean that you have to wait until you start earning six figures to meet with one. Nowadays, we have access to online financial planning that is more affordable than a traditional setup with a financial planner.

What Is LearnVest?

LearnVest is one of the online financial planning companies that promise to make planning for your financial future easier. LearnVest is still pretty young, as it's only been around since 2009. It offers budgeting tools and additional resources and the advice of an online financial planner for an additional fee. In 2015, it merged with NorthWestern mutual which helped it move away from its startup roots, and turn into an even larger company that was able to offer more to their customers.

Features Of LearnVest

LearnVest has a lot of features that to help you adequately plan for your financial future. Read on about some of these features below:

 

  • Paid or Unpaid. LearnVest maximizes its ability to offer you low-cost financial planning by providing a paid and a free version of the service. With the free version of the service, you'll get access to LearnVest's budgeting tool, and a dashboard will reflect how it can help you manage your budget.  
  • Knowledge Center. LearnVest has a Knowledge Center that includes hundreds of articles and videos that go over details about financial planning that you might need to know. It's a broad and general overview, and this is offered in both the paid and the free version.  
  • Personalized Financial Advice. You can receive financial advice unique to you. This is a premium LearnVest perk, and you'll receive guidance regarding your finances as well as access to the information in the Knowledge Center. LearnVest premium charges one time-setup fee of $299 with a monthly fee of $19 for the lifetime of your subscription. LearnVest keeps your finances in mind by giving you the option of paying this hefty start-up fee in three payments of $99 or two payments of $149.
  • Smart Profile. This is used when you first sign up for the service. You'll input information such as how much you earn each year, what your current goals are, and what your budget is at that time. Additionally, you'll link a savings account, credit card, retirement account, or checking account to your profile. You'll also input info like student loans if that applies to you. Following that, you'll be able to have a fifteen-minute phone call with your financial planner.
  • Active Financial Planners. Depending on what your goals are, your financial planner is going to go with you every step of the way to ensure that you're making the right moves. You'll be assigned budgeting homework and the financial planner will tell you whether or not you need to open new accounts to keep your finances separate. This is a premium feature.

 

There are many other long term features that come with setting up an account with LearnVest; the premium option will yield more of the benefits of having a personal financial planner.  

The Fees

While LearnVest is cheaper than a traditional financial planner, it still comes with a few hefty fees. For example, you still have to pay a large upfront fee of $299, and you'll be paying $19 each month after that. However, this is still a steal given that the average yearly price of a financial planner can go up to $1,9000. Of course, you can always stick with the free option, but you won't have access to phone calls and advice from your financial planner.

How To Sign-Up And Get Started

You might be curious as to how you might sign up for LearnVest. There aren't any requirements, and you can sign up and try out the free version, and you can move to the paid version whenever you'd like.

Here's how you'll get started (this is how to sign up works if you have the paid version if you have the free version, then the steps regarding a one on one with your financial planner won't apply to you):

  1. You’re going to fill out all of your financial information and tell your Planner a little a bit about yourself in the Smart Profile feature that was mentioned above.
  2. You and your planner will discuss your money goals and evaluate your current habits. This where you'll find out if you're on the right track or if you'll need more help from your financial planner to help you reach your goals over time.
  3. You'll get a customized program that LearnVest promises will give you a 360-degree view of your finances.
  4. From there, you’ll receive step by step instructions that will help you get on the right track to meeting your financial goals. Once you’re set up, you’ll be prompted to have a phone call with your financial planner.
  5. Over the following month(s), you'll receive tasks (example: opening another bank account, closing an old spending account, re-evaluating your credit cards) that will help you make the progress that you need to make to stay on track.

Pros And Cons

LearnVest is an excellent tool for those of us that have been dragging our feet when it comes down to looking at our finances. However, LearnVest isn't without its disadvantages, and there are certainly a few of those to go right beside the company's wins.

Pros

 

  • Tasks to help you stay on track with your financial goals. Your financial planner will review the state of your finances with you, and they'll be working on ways for you to improve your finances or move more steadily towards your goal. They will set up tasks for you to complete, and you'll receive an email when your new task is ready. The tasks can be anything from going on a spending diet for a few weeks to a month or just watching an educational video about finances.
  • Use it at home or on the go. Are you feeling unsure about buying that new piece of furniture for your sitting room? ThinkVest's mobile app can certainly help with curbing your impulse spending habit, especially since you can open the app at any time and you'll be able to see how your current finances are affecting your goals. You'll get a more detailed view from the desktop version of the website when you check in at home.
  • No meetings necessary. Your financial planner will make it their goal to get back with you as soon as possible. You may not go more than 24 hours without hearing back from them if you have a question. You can email your financial planner whenever you like.

 

Cons

 

  • You’ll have to wait for information on your Credit Score. LearnVest's competitors like Mint will show you how your budget, cards, and finances relate to your credit score. Unfortunately, you'll have to log on to credit score website to be able to keep track of this; it would be helpful to have it all in one place.
  • No face to face interaction. It's not unreasonable to want to have a face to face meeting with the individual that knows everything about your finances and will be guiding you for the foreseeable future. You'll never meet with your financial planner in person, or over web chat. However, you will communicate with a helpful and friendly financial planner via phone or email.
  • If you have multiple investments, LearnVest can’t help you manage them. If you’d like to see how your current investments relate to your financial goals, you’ll have to keep up with those through some other medium, or on your own. LearnVest is simply there to help you manage your finances regarding retirement accounts, saving accounts, credit card debt, student loan repayment, and saving for your long term goals.
  • Limited Features in the Mobile App. While the mobile app is an excellent idea for LearnVest to incorporate into their services, you’ll find that some LearnVest features are pretty limited on the app. You may not be able to catalog all of your purchases at once, but you can always log on to LearnVest’s website to view all of your information.

 

How It Compares

LearnVest certainly has the potential to knock it's competitors, like traditional financial planners, out of the water. It has low rates and is extremely accessible, whether you'd like to access it on your phone or the computer. LearnVest also puts itself ahead of its competitors by allowing you to connect with your financial planner via email whenever you need. However, you might want to know what the competition is offering before you invest.

YNAB

YNAB gets its name by using an acronym for “You Need A Budget,” and you probably do need their help if you're looking into the right budget app for you. YNAB believes that you can achieve financial success and security by following four simple rules. These rules are:

  • Every dollar you spend should have a purpose. So, all of your money is saved and divided into categories so that you never have an excess of extra cash that you might overspend with. Examples of those categories are the budget for your vacation savings, the budget for your clothes purchases or a budget for how much you eat out.
  • All expenses should be accounted into your budget, even if they don't happen frequently but they occur outside of a one-time purchase. For example, if you get your nails done every two months, that should still be counted in your budget, regardless of the fact that you're not going as often as once a week.
  • Flexibility will help you with managing your finances so that you can pull from other categories if you come up short in another one.
  • Your finances should be set up so that you'll always spend and live off of what you earned in the month before so that you can crush the paycheck to paycheck cycle.

YNAB offers live classes to help you manage your finances, and it only costs $5 each month, and it's free for a year for students. You will not get a personal planner the way that you would with LearnVest.

Inuit Mint

Mint is a good option for students that can't afford to pay for a monthly financial planning service. The Mint app helps you put all of your financial accounts in one place, it will remind you when bills are due, generate your credit score for free, and you can link it to your checking or savings account and have your information protected by their 256-bit encryption level.

One major advantage that Mint has over LearnVest is that you can see your credit score as well as your spending habits, savings account and more, but all in one place. To elaborate, LearnVest will handle all other aspects of planning your financial future, but you won't be able to see your credit score and how it relates to your finances on their app or from their website. However, Mint is not promising to have an actual person go over your finances and tell you where to make a few changes.

If you're comfortable with just keeping track of your finances, so that you know what causes your paycheck to dwindle each month, then an app like Mint might be a good fit. If you want something a bit more comprehensive, then LearnVest is the better choice because it's analyzing your spending habits as Mint does, and/ helping you plan for your financial future.

Is LearnVest Right For You?

LearnVest forces you to address your financial fears head-on and to address any crucial mistakes that you might be making so that they can help you fix them, one step at a time.

Additionally, LearnVest is a great alternative if you need an actual financial planner to guide you because the price is far less high than recurring, in-person meetings with a financial planner. If you don't think that you need a financial planner just yet, apps that only track your spending might be a better fit until you're ready to make a transition to a program like LearnVest.

03 Oct

Wealthfront Review 2018 – Best Way to Automate Investing?

wealthfront logo

Making Investing Simple? – Wealthfront Review

Everyone wants to invest to secure their future, but learning about the market is a lot of work. Even with online stock brokers, you’ll have to do a lot of independent research to get the most out of your investment. Because of this fact, robo-advisors are becoming more popular in the hands-off investing community. These advisors help handle your portfolio and make decisions, so you don’t have to. They put your money to work for you.

Wealthfront is one such robo-investor that is gaining popularity. Ahead in this Wealthfront review, we’ll take an in-depth look at the service and let you know if it’s worth investing your money with them. Good advice is always welcome, and Wealthfront is in the business of investment advice.

What is Wealthfront?

Wealthfront was founded in 2008 under the name kaChing. It was a mutual fund analysis company to start but eventually moved in the direction of wealth management. Now, they’re an automated investment firm, managing more than $5 billion in assets.

Wealthfront operates under the statement that software is better than people in many cases. From online ordering to requesting an Uber, software has made almost everything more efficient and accurate. They believe that the same goes for financial advice. Wealthfront’s software can determine the best investment strategy for each user, more so than a human advisor could. The software has all of the data at its disposal, with no human element that can often screw things up.

How Wealthfront Workswealthfront path

To get started with Wealthfront, you’ll first have to create an account and fill out a questionnaire. The survey you’ll take will assess your risk tolerance and decide which investment strategy is right for you as an individual. From there, the software takes over. Wealthfront rebalances your portfolio through thresholds, keeping you true to your risk analysis and as tax-efficient as possible.

Wealthfront supports accounts such as IRAs, Roth IRA’s, individual and joint non-retirement accounts, 529 college savings plans, and trusts. Their Tax-Loss Harvesting feature will allow you to keep as much of your money as possible by automatically moving money without changing the strategy with which Wealthfront will invest your money. If you have over $100,000 in your account, then you’re eligible for tax-optimized direct indexing, which further limits your tax burden through software optimization.

For those with a balance of at least $500,000, they offers Advanced Indexing, which exposes your portfolio to tested factors which aim to improve your Wealthfront returns while staying true to your identified risk exposure. With these strategies, Wealthfront can put your money to work passively. You’ll hardly have to pay attention to your investments, as their software programs make decisions for which you’d have to pay a human advisor a hefty fee.

If you’re a smaller investor and have less than $5,000 to invest, Wealthfront will employ a different strategy. Because there is less money to work with, Wealthfront will deviate from the risk analysis they take at the beginning. This strategy means that they might be taking more of a risk than you’d like, but they have a chance at a higher profit in the long-run. According to them, their algorithm shows that this deviation allows smaller amounts to grow faster with little difference in long-term performance.

Pricing

wealthfront fee

Robo-advisors are far cheaper than human advisors, and appear as though they’re consistently more accurate. Wealthfront gets you off on the right foot by managing the first $10,000 of your investment for free. After that, Wealthfront fees are 0.25% annually. This fee is in-line with the robo-advisor standard, as other competitors use the same payment structure.

If you want to invite a friend to invest with Wealthfront, they also offer a referral benefit for both you and the person you send over. For each person you refer, Wealthfront waives the referral fee for another $5,000. This will apply to both you and the person you refer, allowing them to start with $15,000 of fee-free investment.

Try Wealthfront

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Steps to Get Started

  1. Fill Out the Questionnaire
  • As you create your account, Wealthfront will ask you a series of questions to determine the best portfolio for you.
  • You can always change your answers at a later date
  • At the end of your application, Wealthfront provides you with a recommended portfolio and risk score
  1. Look at the Investment Plans
  • Based on the answers you provided, Wealthfront will tell you how they plan to invest your money.
  • Make sure you agree with how they intend to invest before continuing.
  1. Open an Account
  • If you’re happy with your answers and the following investment strategy, open your account.
  1. Fund your Account
  • The account minimum is $500, so deposit at least that much.
  • Transfer an existing account, deposit, or wire transfer the money into your new account.
  1. Passively Invest
  • Allow Wealthfront to do the work for you and monitor your investments passively.

Pros and Cons of Wealthfront

Pros:

  • Low management fees
  • Tax optimization
  • Easy-to-use portfolio review tools
  • Tailored investment strategy

Cons:

  • Customer service only available during business hours
  • Low cash balance

wealthfront retirement

Public Perception (Other Wealthfront Reviews)

There doesn’t seem to be much in the way of complaints about the service in other Wealthfront reviews. We haven’t seen anyone warning of losing their entire investment through the management service. Users appear to like the tax strategies more than anything, as they allow users to save as much money as possible at a low management fee. Customer service could be better – especially since they aren’t 24/7 like some competitors – but overall people seem to have had a positive experience using Wealthfront.

wealthfront projection

Competition

Betterment is the main competitor to Wealthfront. Both services use the same management fee, but Betterment has more requirements, especially when it comes to the promotion. Instead of a flat $10,000 of free management, Betterment gives one year of free management with a deposit of over $500,000. Below that, investors will get up to nine months depending on the size of their deposit.

A regular Betterment account charges 0.25%, but a premium account (over $100,000) will put you in the 0.4% fee range. If you’re a heavy-hitter, though, you’ll be able to take advantage of the removal of the management fee for accounts over $2 million (though this is a tiny percentage of their users).

Personal Capital is another competitor of Wealthfront’s. Their management fee is considerably higher at 0.49%-0.89%. This service is geared more towards big-spenders, with a minimum account balance of $100,000. Any amount under $1 million is going to cost you 0.89% in fees. It’s not until you get to over $10 million that you’ll receive the 0.49% rate, and that’s still far more than Wealthfront’s 0.25%.

Join Wealthfront

Should You Get Wealthfront?

If you’re interested in getting a robo-advisor to help secure your investments, Wealthfront is a particularly good option. The Wealthfront fees are low, and their promotion is realistic. You won’t have to commit a significant amount of money up front, which means you’ll have more flexibility if you decide Wealthfront isn’t for you.

Investing your money is a big decision, and Wealthfront allows users to invest $10,000 before ever seeing a management fee. When you eventually do experience a fee, it will be a far cry from what some of the competitors are charging. Hopefully, this Wealthfront review helped you make a decision, and we wish you best of luck in your future investments!

Click Here to Sign-Up

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02 Oct

Betterment Review 2018 | Makes Investing Simpler or Just Wastes Time?

betterment review

A Legit Way to Invest? – Betterment Review

betterment logos

Whether you are looking to create a retirement plan or meet a financial goal, Betterment offers a service to increase your investment dollars. This company is a great starting point for beginner investors because it has no minimum deposit and a fee which is lower than many other companies. In a world with growing number of robo-advisors, Betterment is one of most competitive options out there. This Betterment review will discuss how you can get an improved experience that encourages the growth of your money!

What is Betterment?

More than anything, Betterment is a robo-advising company with the capacity to offer low-fee and no-hassle retirement options for individuals to secure their financial future or reach a financial goal. Betterment focuses on consumers that are coming to their platform for hands-off investing, retirement money, goal-based investment, and automatic rebalancing.

The company offers automatic rebalancing which keeps funds split proportionally between stocks, bonds, and cash investments. The company supports IRAs, Roth IRAs, Trusts, and Taxable accounts. Because of their approach to seeing investing as a long-term plan, Betterment works to lower taxes, fees, and diversifying your portfolio.

Betterment is offering up to 1-year managed for free depending on the amount of money put in your account within 45 days of making the account. (Your deposit amount must be greater than $500,000 to qualify for a full year free).

How Betterment Works

Currently, Betterment offers a free 15-minute call for potential customers looking to get started with the process. Help your money mature in the best way possible with a financial advising service.

portfolio breakdown

There are two types of accounts available on Betterment, either Digital or Premium. Digital accounts get personalized financial advice, automatic rebalancing, tax-saving strategies, and all information in one place. The Premium plan goes beyond the Digital offerings because clients get in-depth advice on investments, unlimited access to financial planning professionals, and even a one-on-one relationship with a planner. Other key services offered by Betterment are:

  • Betterment Advisor Network: The CFPs in Betterment’s network are vetted by the company to maximize your money. You get to know your advisor personally.
  • Automated Portfolio Rebalancing
  • Smart Deposit: Works with existing auto-deposits to invest excess cash from your checking account
  • Betterment Premium: This plan option offers access to CFP professionals and licensed financial experts.
  • Tax Loss Harvesting: This is a process which involves selling a security that has experienced a loss and then replacing it with a similar asset. It keeps your portfolio balanced and decreases your loss.
  • Two-Factor Authentication: Protect your account by enabling two-factor authentication.

Pricing

betterment pricingThe Digital option has a flat account management of just 0.25% annually. This service has no account minimum. Betterment Premium has a higher price than the Digital option but also has an account minimum.

A minimum balance for a Premium client is $100,000 with a .40% annual fee. The Premium service comes with all of the Digital plan benefits and advice on investments with unlimited access to Certified Financial Planners.

According to this fee structure, the more your money grows and passes a minimum balance, the less of a percentage you pay on investments.

Steps to Get Started

Just sign up for Betterment on their website to monitor financial accounts in one place. When signing up for an account, all you need to do is start with an investment plan. Give your age, basics about your work, and your annual income. The website is easy to use and helps you go from there. After consolidating your accounts into this platform, your money works for you, all in one place.betterment mobile

Betterment is an easy to use interface, all you need to do is go to the website and click the “Get Started” button. Then follow these steps:

  • Enter your age, retirement status, and annual income
  • Choose an investment goal including “Safety Net,” “Retirement,” and “Investing.”
  • Add your email address and password to start an account
  • Fill out your contact information
  • Enter information to verify your identity, which complies with the USA PATRIOT ACT
  • Add your financial background including your employment status, annual household income, estimated investable assets, and answering questions
  • Determine if you wish to roll over an old 401(k) or an IRA
  • Answer regulatory questions including your status as a broker-dealer and company shareholder
  • Set your account security questions and solutions and the account is created!

After account creation, fill out information about your savings and investing strategy:

  • To set your plan, you must first confirm your email address
  • Betterment gives a recommendation of stocks versus bonds based on your age
  • Check out different strategies if you don’t like the recommended allocation with the “See other strategies” button
  • Review your allocation by determining if you are willing to take on less or more risk
  • Click ‘Finish Set Up,’ and you are ready to go!
  • Set up your deposit details with an amount, frequency, a recurring payment, and the date of the withdrawal

Join Betterment

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Pros and Cons of Betterment

Ready to change your financial future for the better? Selecting a robo-advisor for growing your investments prepares you for situations like retirement, emergency costs, or even a planned vacation.

Pros

betterment assistantOne of the biggest advantages of using Betterment is they do not manage funds of their own. Often, financial advisors make recommendations based on the strength of a fund and also if it is a fund of their own. Betterment doesn’t get commissions for recommending certain funds and doesn’t manage their own funds. This means a client is always getting an unbiased and fair opinion about their investments. Other pros of choosing this service include:

  • The option to create a joint account with a spouse
  • A primary, set fee with small and a transparent structure
  • No cost for trading, transfer, or rebalancing
  • Get personalized advice from experts whenever you need it
  • Betterment helps lower your taxes because of its algorithm
  • There is no charge for an account with no balance
  • It is easy to cancel your account and no charge for doing so
  • All accounts are in one place
  • Customer support seven days a week
  • Founded in 2008 with a launch in 2010, they’ve been around for a while
  • There is a mobile app that is easy to use
  • Boasting a return that is 2.66% higher than a typical investor

Cons

There are a few negatives associated with having a Betterment account. These include:

  • Does not support all types of accounts
  • A small percentage of users qualify for the free account management for a year
  • Customer support is available on Eastern time
  • To fully understand the product, some people need to conduct research

Public Perception

Both in professional and customer Betterment reviews, the service is rated highly. In a recent customer review Mariah of Orlando, Florida said, “The customer service was great…Anytime I called, the workers were always very friendly and helpful with answering my questions.

The customization options are great. I like that they offer many and that I was able to choose which one was the closest to matching me and what I could afford at the time.”

For people that like figuring out their investments and working with website features, Veronica of Chicago, IL says, “The ease of use is very good. Navigating the services it offers and other areas within are very much self-explanatory, which I admire since I favor being able to figure things out on my own.”

betterment retirement

Competition

The competition is stiff when it comes to Robo-Advisors. The space is rapidly expanding, and there are many companies out there. The competition Betterment faces include:

  • Wealthsimple: There is no account minimum for this company, but management fees are on average, higher than Betterment.
  • Acorns: There is no account minimum, and this option is free for college students. This company has fewer assets under management than other groups.
  • WiseBanyan: This company boasts being the only free service, but the company is newer than most and hasn’t proven the effectiveness of its fee structure.
  • Charles Schwab: The service is free but they require an account minimum of at least $5,000, and they require a certain percentage of your funding to be in cash.

Should You Get Betterment?

As you've read in this Betterment review, this service is the right option for individuals looking to invest and watch their money grow. In fact, they boast better returns than the typical investor because of their smart rebalancing strategy. You have nothing to lose by getting started with investing through Betterment investing. Set and achieve goals with this company on your side.

Try Betterment

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images: betterment.com

28 Sep

Stash Review – Can I Really Start Investing With JUST $5?

stash review

Is It Worth My Time? – Stash Review

Is Stash legit? Among the new class of investing apps, our Stash Review attempts to shed some light on an interesting investment option.

stash app investing simplified

These days the concept of investing money has become increasingly intimidating, understandably. There’s a massive amount of outlets to invest your money into and finding the right one to place your hard earned cash is frustrating.

Enter Stash Invest.

What is Stash? Founded in February of 2015, with the aim to simplify the investing process, Stash Invest is an opportunity for investors to ease into the stock market, using an accessible mobile app platform. The target users for this app are first-time/inexperienced investors with an interest in easing into investing with smaller amounts. Keep reading for our full Stash Invest Review.

How It Works

Upon signing up, users are asked to answer a few questions, a process that takes roughly two minutes. These questions identify the user as a conservative, moderate or aggressive investor.

Starting with a minimum investment of $5, investors are provided 30 themed offerings to choose from. These offerings are separated by risk tolerance and investor interests.

Here are some examples of these themed offerings:

  • Clean & Green – Investments centered around creating a better future for our planet.
    • Sample Holdings: Electric Power Development Co, Meridian Energy LTD, Xinyi Solar Holdings Ltd, Vestas Wind Systems
  • American Innovators – For individuals interested in investing in tech companies.
    • Sample Holdings: Apple Inc, Facebook Inc, Microsoft Inc, Google Inc, Cisco Systems Inc
  • Enjoy Yourself – Centered around investments in entertainment/travel companies.
    • Sample Holdings – Delta Airlines, CBS Corp, MGM Resorts International, Las Vegas Sands Corp, Twenty-First Century Fox Inc.

stash invest auto

 

Behind the scenes, these themed packages are actually ETFs that are controlled by popular investment firms like BlackRock, Vanguard and Charles Schwab.

Stash provides a pleasant user interface that clearly shows you what you’re investing in, vastly simplifying investing. Taking a microsavings approach, the app invites you to invest small amounts rather than saving up hundreds of dollars ahead of time. 

 

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Try Stash

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What Are the Fees?

Knowing the fees involved is crucial when choosing any investment service. Similar to its service, the fees are straightforward and easy to understand.

Users are charged $1 per month on accounts with under $5,000 and a 0.25% fee per year on accounts over $5,000.stash prices

These fees are meant to get inexperienced investors to try investing without a significant financial commitment. Many have noted in other Stash Invest Reviews, that these fees are reasonable. As users expand their investment portfolio in Stash, they change over to the 0.25% annual fee upon reaching $5,000.

 

Steps to Get Started

  1. Get Stash on your device
    • Start by learning more on their site
    • Download the Stash app on your Android or iOS device
  2. Create a profile
    • Follow through the Stash profile guide
    • You will answer contact questions as well as identify your risk tolerance
    • This process will take approximately 2 minutes
  3. Pick your first investment
    • Using the answers from the survey, Stash offers suggestions for your first investment
    • The offerings are divided up into three different risk categories:
      • Conservative
      • Moderate
      • Aggressive
    • These are ETFs with names like Delicious Dividends, Small but Mighty and Blue Chips
  4. Attach your funding account
    • During this step, you link to your checking account through one of two ways:
      • Enter your bank username and password
      • Use a micro-deposit verification process
  5. Identity Verification
    • Complete requested verification (required by law)

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Sign Me Up

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The Pros and Cons of Stash Invest

Pros

  • First and foremost, the primary advantage to Stash is its ease of use (especially compared to other investment apps). It can turn anyone into an investor in under 30 minutes. The entire process from sign-up to investing, is logical and simplified.
  • Adding additional investments is simple and small amounts can be invested on a regular basis. This allows the user to quickly diversify their current portfolio or add funds to current offerings.
  • It enforces the investment methodology of buy, hold and add. Meaning, it encourages users to select offerings and commit. This allows for long term growth and eliminates the stress of managing when to buy and sell stocks.
  • With offerings split under headers such as I Believe, I Want and I Like, users can invest in markets that they like, such a tech companies, or things they believe in, such as clean energy.
  • Reasonable fees that encourage first-time investors to try out investing.

Cons

  • Stash focuses on ETFs rather than individual stocks. Offerings are simplified and easily packaged in this way, but it limits personalized investment choices.
  • Account fees are charged to the checking account on file rather than from investments. It can be inconvenient to see funds exiting your checking account rather than managing such activity within the app.
  • Investing in your interests may be a pro, but it’s also a con. Following your passions in making investment decisions isn’t necessarily the best idea, yet this mentality is a significant part of Stash’s set up.
  • The fees ($1 under $5000, 0.25% over $5000) aren’t intimidating, certainly a pro as your investments grow, but as noted in other Stash reviews, for starting/small investments such fees can be counterproductive to growth.

stash review logo

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Stash Retire

An honest Stash review wouldn't be complete without discussing all of the services that Stash offers. One of the newest services they offer are retirement investment opportunities.

One of my original cons of Stash (and remains an issue for similar apps such as Acorns) was that they only offer taxable accounts. Using a taxable account is great as a supplemental investment strategy, but it certainly isn't how to invest for retirement. Many popular online stock brokers such as Betterment and Wealthfront offer a variety of retirement account options, such as traditional IRAs and Roth IRAs.  Using these types of accounts are the proper way to start investing money for retirement.

Stash recently introduced Stash Retire to accommodate these needs. Stash Retire now allows users already investing with Stash, to add an additional retirement portion to their account (a taxable account and a retirement account). This retirement account is a Roth IRA and setting it up is similar to setting up the app. You will  choose between two investment options for your account, which are as follows:

  • Recommended Investment Mix
    • Conservative, Moderate, Aggressive
    • Consist of stocks, bonds and cash
  • Park My Cash
    • Bond fund that generates monthly dividends to maintain initial investment

After setting up your investment choice, you'll have access to adding any of your favorite ETFs that are available in your Stash Invest account, to your Stash Retire portfolio. The minimum to open a Stash retirement account is $15 and the fee is $2 per month for accounts up to $5,000 and 0.25% for accounts over $5,000. Although Stash may not offer the variety of account types as Betterment or Wealthfront, the fact that they now offer the Roth IRA accounts for iOS and Android users, gives Stash the competitive edge (at least in account options) over similar app-based investment services.

Competition

The primary competition for Stash, among millennial oriented investment apps, are Acorns and Digit. All three apps offer easy-to-use interfaces and each cater to a particular need.

Whereas Stash allows the user to invest in and maintain a variety of portfolios, Acorns has the user pick between 5 investment categories ranging from Conservative to Aggressive. From there the user doesn't have to do any maintenance, as Acorns works by rounding up all debit/credit card purchases to the nearest dollar and investing that spare change into the selected investment portfolio. Therefore, the Acorns app is much more hands-off than Stash. Check out our Acorns Review to learn more.

Digit, on the other hand, isn't an investment service in the way that Acorns and Stash are. Digit works by analyzing your spending habits, and then pulling money from your checking account and placing it into a savings account based on that information. Once in the savings account, that money isn't actually invested (nor does is accrue interest). It is simply a free savings tool.

There are a variety of app-based investment services that can meet almost any unique need. Though, if you are looking for a more involved (yet simple) interaction with your investment portfolio, Stash is a great choice.

Is Stash Invest Worth It?

To summarize this Stash Review, it is a great way for first-time/inexperienced investors to learn how to invest, especially if they're not sure what to invest in. Among the millennial-targeted, simple investing apps that have rose in recent years, Stash holds its own. Offering a simple and creative user interface, users can browse through their portfolio with ease while getting statistics on their account growth.

Not without its faults, Stash Invest does have some shortcomings. The process of investing may be a little too easy, as selection in independent stocks isn’t available. In addition, being led by your interests rather than research when investing can ultimately lead to poor investments.

If you are a looking for investments for beginners, Stash is a great choice. It streamlines the investment process and takes out the stress, by showing you things to invest in. Even compared the best investments apps, such as the Acorns app, it holds its own. If you are a seasoned investor, perhaps stock brokers like TD Ameritrade or Etrade are a better fit.

Whether you’re looking to try investing or expand your independent stock portfolio, Stash is at least worth a look.

 

Now that you've read our Stash App Review click here to try it out!

 

 

images: stashinvest.com

25 Sep

Stash vs. Acorns: Deciding the Best (and Easiest) Investing App

Ease Into Investing | Stash vs. Acorns

Investing is not a popular habit to pick up. Between balancing work life and personal life, there seems to be no time at all to decide which stocks to buy and sell.

Following the millennial-oriented trend of making things simpler and intuitive, Stash and Acorns offer a way to easily begin investing. These app-based services allow anyone to try out investing without immense financial risks. Both Stash and Acorns allow anyone to check-in/make changes to their portfolio without stress. Analyzing Stash vs. Acorns will allow you to decide the best app to use to start (or continue) investing.

trying Stash

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The Rise of Investment Apps

Online investment brokers, such as Wealthfront and Betterment, have offered the ability to acquire and trade stocks for years. The issue that has arisen with this, is that many novice investors struggle to decide where to invest their money. The research to decide things, like the best ETFs for their needs, can be very time-consuming. Stash and Acorns both use robo-advisor features to do the difficult investment work for you.

Acorns for Android and iOSPlatform

Although both of these services are designed to be used on your Android or iOS device, both Acorns and Stash offer web access as well. These apps both provide a pleasant user interface that allows for easy access to account reporting, investing/withdrawing cash, changing ETF selections, etc.

Portfolios

The portfolio selection between Stash and Acorns is structured similarly. Both apps allow the user to pick between a professionally selected group of ETFs to place their money. Beyond that concept, the differences in the portfolios are as follows:

Stash Invest ETFs

  • Most of the investments on Stash are ETFs (group of securities that work to track an index, typically with a theme). Roll with Buffet is the only investment bundle that isn’t a typical ETF like the other choices.
  • Upon signing up for Stash, the user is asked to complete a short assessment that classifies the user as a conservative, moderate or aggressive investor.
  • From there, the Stash Invest user is provided a recommended list of ETFs that fit their risk threshold. These ETFs are themed and so allow the user to invest in packages that interest them. Here are some examples of these themed packages (Stash offers around 30 portfolio options in total):
    • Blue Chips (Conservative) – Consists of popular and impactful tech companies such as Apple Inc., Microsoft and Amazon.com.
    • Clean & Green (Moderate) – Investments in clean energy companies such as First Solar Inc., Gamesa Corp Technologica and Vestas Wind Systems.
    • Modern Meds (Aggressive) – Made up of investments in biotech and pharmaceutical companies such as Exact Sciences Corporation, Vertex Pharmaceuticals Inc. and Regeneron Pharmaceuticals Inc.
  • Investments, as low as $5, can be placed into one (or more) of the above ETFs.

Acorns ETFs

  • Like Stash, Acorns consists of ETFs, though their portfolio options are much more limited.
  • Also similarly to Stash, after signing up, the Acorns user is asked to complete a short assessment that decides the user’s risk tolerance.
  • Though the similarities stop from there, as Acorns has the user pick one (and only) one of the below ETF categories:
    • Conservative
    • Moderately Conservative
    • Moderate
    • Moderately Aggressive
    • Aggressive
  • As you can see, Acorns may have significantly less ETF choices, but instead they allow the user to simply invest their money into a risk category.

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Stash Your Cash

Beyond the similarity in platform and portfolio design, there are stark differences between these two services. Stash Invest offers a slightly more involved approach with your investments.

Overview

using the stash appAfter signing up and choosing a starting ETF, how you maintain your account is up to you. Your initial $5 investment is placed into the ETF of you choice (perhaps American Innovators or Enjoy Yourself). From there, Stash will maintain that ETF and document any/all growth your investment accrues. The Stash app encourages you to add to your account on regular intervals (this can be automated). You can decide to keep adding money to your initial ETF choice or you could choose to invest in another ETF and build-out your portfolio. You have complete control over how much/when you invest your money and what particular ETF you’d like those funds to go into. To get more info, check out our Stash Review.

Knowing the Fees

As Stash isn’t a free service, you need to be aware of the fees involved. As you begin investing, Stash charges $1 per month for accounts under $5,000 and 0.25% annually for accounts over $5,000.

Join Stash

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Investing Your Spare Change With Acorns

Whereas Stash gives you a variety of ETFs to use and allows you to choose when to invest into them, Acorns investing works much differently by taking a robo-advisor approach.

Overview

using AcornsUpon signing up, completing a profile and choosing a risk threshold (ranging from conservative to aggressive), the hard work is done. Acorns links to your bank account(s) and debit/credit cards. For each purchase you make, Acorns rounds that sum up to the nearest dollar and invests that change into your selected ETF. There is no work necessary on the user’s side, as the Acorns app rounds-up purchases and invests that “spare change” simultaneously. You simply set up an account, and watch your investment grow. This is a much more hands-off approach to investing than that of Stash. It even has incentives, such as Found Money, where Acorns partners, like Nike and Apple, place cash back from purchases into your account. Check out our Acorns Review to learn more.

Knowing the Fees

The fees are exactly comparable to Stash in that Acorns is $1 per month for accounts under $5,000 and 0.25% annually for accounts over $5,000.

Join Acorns

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Deciding the Best Investment App

So which is the superior service in regards to Acorns vs. Stash? Well, as you can see from the comparison above, it really comes down to your needs.

If you are looking for a variety of ETFs, control over when you invest/how much and developing a ETF portfolio full of variety, then Stash is likely the better choice for you.

On the other hand, if you are looking for a completely hands-off micro investing approach that doesn’t offer an overwhelming amount of ETF options, then Acorns may be just the right fit.

One thing to keep in mind is Acorns (at this time) only offers taxable accounts. If you are looking to build a retirement fund, Stash now offers Roth IRA accounts in addition to their taxable accounts.

The most important decision to make is not deciding the winner in Stash vs. Acorns, but rather, when to get started investing. When it comes to investing, it’s never too early, and these apps will certainly help get you started.

 

images: stashinvest.com & acorns.com

22 Sep

Acorns Review 2018: Legit Spare Change Investing App or Scam?

acorns review

Is Acorns Safe? – Acorns Review

Is Acorns worth it? There certainly are many app-based investment services currently, though our Acorns review will explain why it may be worth a second look.

Spare change has been getting lost from purchase to purchase as long as we can remember. It falls out of our pockets, litters our car and even gets consumed by the living room couch. The way we pay has been rapidly innovating and now many of us find ourselves paying with our cards much more frequently than cash.

Although you may be reducing how much spare change you physically have, Acorns offers an option for your “digital” spare change.

Among the plethora of millennial targeted investment services, many favor Acorns as their first step into investing.

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What Is Acorns?

invest with acornsAcorns was founded by a father and son team in Newport Beach, CA in February, 2012. The goal of the service is to remove any intimidation from the investing process and offer an easy starting point for new investors.

Using the Acorns iPhone or Android app, users can employ intuitive investment strategies that focus on forming long-lasting investment habits. Acorns was made with millennials in mind, providing a mobile app interface and easy-to-use investment service. However, this service is great for anyone who has difficulty saving, isn’t an investor or just doesn’t want to put in the work of investing themselves.

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How Does Acorns Work

Acorns investing utilizes a robo-advisor technology that employs the ideology of investing your spare change by rounding up all purchases you make with your debit/credit cards and immediately investing that change into an investment portfolio.

This “spare change” investing may not lead to millions in retirement cash, but it certainly is a great way for new investors to integrate investing habits into their daily spending.round up using the acorns app

The process of rounding purchases up the to nearest dollar and investing the left over change, is labeled “round-ups” by Acorns. For example, if I were to pay $29.25 to fill up my gas tank, Acorns would round that purchase up to $30 and invest the remaining $.75 into an investment portfolio.

After downloading the Acorns app, you’re asked to create a profile that asks a variety of questions to formulate your ideal investment portfolio. You are then asked to link your bank account(s) and debit/credit cards. After that, you are presented with a variety of customization options. You will choose how much you’d like to round-up by and your investment portfolio choice. There are 5 investment portfolios to choose from and they range from conservative (bonds and cash) to aggressive (equities). The service then begins monitoring your purchases and rounding up those amounts. When spare change accumulates to $5, it invests it for you (this amount can be customized).

Below is an overview of the benefits of being an Acorns investor:invest everyday with acorns

  • Automated Investing – round up purchases and invest that change automatically
    • Add in recurring daily, weekly or monthly investments
    • Place one-time additions to your account
  • Smart Portfolios – choose from 5 different portfolios that were created with the help of Nobel Prize-winning economist, Harry Markowitz
  • Link Unlimited Cards – link any and all of your debit and credit cards for round ups
  • Transfer Anytime – invest or withdraw anytime
  • Found Money – shop with Found Money partners, such as Apple, and they will automatically invest incentive cash back into your account
  • Grow Magazine – a personal finance magazine written to expand money knowledge
  • Security – user data is secured with 256-bit encryption and that data is never stored on your device
  • Referrals – Acorns will add to your account when you get your friends to join

 

Pricing

Pricing for the service is fairly competitive, comparative to other services in the market. Acorns fees for the service are as follows:

  • Account under $5,000 – $1 per month
  • Accounts of $5,000 or more – 0.25% annually
  • College students – free for up to four years with a valid .edu email address

To offer perspective, competitor services such as Betterment’s Digital plan costs 0.25% annually from the start whereas Personal Capital has a minimum balance of $25,000 and charges 0.89% for the first $1 million. The spectrum of investment services is very wide and there’s a unique solution for every need (some investment needs are more expensive than others). For new investors, Acorns offers advantageous and competitive pricing.

Try Acorns

Steps to Get Started

    1. Download the Acorns app
      • Available for both Android and iOS
    2. Set up an account
      • Answer the necessary questions in the signup process. These questions are personal and meant to craft the best portfolio for your situation.
    3. Connect bank accounts and credit/debit cards
      • Ease of connecting your bank account really depends on what bank you use. Although the process is easier for some banks, overall it’s a simple procedure.
    4. Customizations and portfolio choice
      • Select how much you’d like to round up by (typically just to the next dollar)
      • The 5 portfolio options are as follows:
        • Conservative
        • Moderately Conservative
        • Moderate
        • Moderately Aggressive
        • Aggressive
      • These portfolios were created with ETFs from investment management companies like Vanguard, Pimco and BlackRock
    5. Using the service
      • Begin making purchases and automatically investing the “round-ups”
      • Make one-time or recurring additions to your account

acorns app on any device

Pros and Cons of Acorns

Pros

  • The fees for the service are reasonable. $1 per month for accounts under $5,000 and 0.25% annually for accounts $5,000 and over. These fees are minimal for investors just starting, yet when those investments build, they are rewarded with a “reasonable” permanently fixed rate. Better yet, college students, which make up a large portion of the target customer base, are free for four years. This is certainly a great perk for novice investors without a consistent income.
  • Offered benefits like Found Money, give great opportunities to build your account. When making purchases with partnered companies such as Apple, DirectTV or Nike (to name a few), you are rewarded with cashback that’s invested into your account from that purchase.
  • Offering up a variety of educational material, such as their Grow Magazine, it’s clear Acorns is passionate about making their customers more financially informed.
  • With no minimum investment, Acorns can be joined without any intimidation.
  • Certainly the biggest “pro” is the actual investment service. The round-up and investment process is fully automated, allowing the user to grow their portfolio without even thinking about it.
  • The entire user experience is straightforward and easy. The app is user friendly and offers complete control and account reporting.

Cons

  • Only offering taxable accounts is certainly a limitation. Whereas other robo-advisors allows IRA and 401(k) options, Acorns is limited to earning money in a taxable account. Although that’s great for side investments, most of our contributions should be directed towards financing retirement.
  • By only offering 5 portfolio options, the investment procedure is simplified, but this becomes a limitation because as investors gain experience, they may be interested in more customized portfolios. These portfolios are also limited in that they cover less asset classes than competing robo-advisor portfolios.  

Get Started

Public Perception (Other Acorns Reviews)

Since the start of Acorns in 2012, it has garnered generally positive feedback in various Acorns reviews. As we've discussed in our Acorns review, many praise the app’s simplicity and ease of use. They also appreciate how it’s great for encouraging first time investors by making the investing process incredibly easy.

looking at iphone

Though, many of these Acorns reviews do discuss the service’s limitations. One is that there are only a few portfolio options. Customization of the current portfolio choices is something yearned for by more experienced investors. Another complaint is that it only utilizes taxable accounts. Those investing for their retirement may look elsewhere for this reason alone. Overall, the public perception is positive and with mostly 4/5 star reviews, it’s clear this service is appreciated.  

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Competition

When analyzing similar services that target millennials, the primary competitors are Stash Invest and Digit.

The Stash app utilizes a similarly easy-to-use interface but it doesn’t actually doing any auto-investing for you. The user gets to choose their own portfolio and add funds accordingly. The Stash portfolio options are significantly higher than the 5 choices Acorns offers. Stash offers the first month free but after that they charge the same fees of $1 per month under $5,000 and 0.25% for $5,000 and over. Check out our Stash Invest Review for more.

Digit works much differently in that it analyzes your spending patterns and automatically pulls out cash to save from your bank account based on that info. Therefore, Digit is simply saving that money for you, for free albeit, with no interest. Digit certainly has the advantage as it’s free to use, but it isn’t actually investing anything. It’s great if you’re just looking to save money, but for investing, Acorns is the way to go.

acorns logo

Should You Get Acorns?

Whether or not you should get the Acorns investment app really comes down to your particular situation. If you are a first time/novice investor looking to get started, Acorns is a great choice. Every aspect from the signing up to interacting with the app is intuitive. It’s particularly great for college students as they typically aren’t dealing with a lot of money to invest and it’s free for 4 years with an .edu email address.

Though for experienced investors looking for a variety of investment portfolio choices and account options, Acorns may not be a the right fit. Though, it can be advantageous to anyone looking to begin small investments in taxable accounts.

Well, is Acorns legit? From everything I've discussed in this Acorns app review, I'd have to say that it's an innovative service that can turn anyone into an investor. Acorns is worth a look simply for the benefits the service offers and as it takes a micro investing approach, you aren’t making life changing financial decisions.

Click here to try out Acorns.

 

images: acorns.com