'Spare change' investment apps clearly have the potential to be useful for beginner investors or even college students who have a limited income and want to avoid complex processes and services. This can limit your options if you have specific long-term investment goals. There is no option to enroll in a tax deferred account like a Roth IRA. These apps tend to only offer one type of taxable account to investors. You can find better fees elsewhere if you aren't limited in terms of how much you can invest. These apps aren't really designed to hold exceedingly large investments. As you can see, the more money you have invested, the higher the fee will be with spare change apps. Your fee would be even more with Acorns' slightly higher fees. But for a balance of $50,000, with a fee of 0.25% annually, that adds up to $125. As mentioned above, Stash and Clink charge a fee of one dollar per month for balances under $5,000-this would be $12 a year fee. Sometimes this isn't worth it in the long run. If you start to invest more into spare change apps, you end up paying more money. If you can afford to invest $100/month for example, why not set up a recurring transfer for that amount instead? Especially if you're looking to retire on your investments one day. In other words, while your fee is small, it's taking up five percent of what you contributed for the month. If you use an app like Acorns and round up $0.30 of spare change for 60 transactions for the month, you've only invested $18 or $17 after you account for the monthly fee. The idea of investing spare change sounds easy and effective, but you also have to consider your personal goals for investing. What's better, it only takes a second to choose because Stash does all the research and categorizing for you. Acorns allows you to invest spare change using their 'round up' system which rounds up all the purchases you make on your debit card to the nearest dollar.įor socially responsible investing, Stash allows you to invest in companies that support causes you're interested in like green energy, tech, and more. You can set up recurring transfers to your account and invest without even thinking about it. It's easy to see your earnings, and some apps can even project your earnings years down the road if you continue to make monthly contributions.Īnother huge benefit with apps like Acorns, Stash, and Clink is that they are all automatic. The money you invest will be placed into a portfolio of Exchange Traded Funds (ETFs) based on the level of risk you choose.
Once you set up your account, you won't have to worry about picking and trading stocks. You can set up your account in minutes and track the progress of your investments and review your options. Pro: Simple to useĪpps themselves tend to be user-friendly and these micro investment apps are no exception. However, once your balance exceeds $5,000, using these apps becomes less ideal and we'll explain why in the cons section. This is ideal for beginners who are just getting started with investing. Acorns charges $1.25 a month for balances under $5,000 and 0.275% annually on balances over $5,000. Stash and Clink charge one dollar a month for balances under $5,000 and 0.25% annually on balances over $5,000. Acorns, Stash and Clink all charge a monthly fee of one dollar for balances under $5,000. Pro: Low fees for smaller accountsĪnother benefit of using these micro investing apps is that there are low fees for smaller accounts. With these apps, you can easily cut out your morning coffee (or other costly, unneeded expenses) for a few days and round up the money to start investing. Check out our Acorns and Stash reviews for more information! With the Clink app, you can start investing with as little as $1- the idea is to invest $1 per day. With either app, you can start investing with just $5. Since there's already a notion that you need a ton of money to start investing, spare change apps like Acorns and Stash debunk that myth easily.
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