Have you tried using the app Acorns for investing yet? I just downloaded it, and I don’t know why I waited so long! Acorns is a great way for regular folks to start an investment portfolio – it’s straightforward and you don’t have to put up thousands of dollars. So, let’s see how it works!
Using Acorns for investing
Free Five Bucks Just to Start
In order to start using Acorns for investing, you need to get the app. If you use my referral code, we can both get five extra bucks! What are you waiting for? Download it here! Then, you can refer your own friends and everyone can get five bucks. That’s a super easy way to get free money into your portfolio!
After you download acorns, it will ask you a series of questions about your risk tolerance and your investment time frame. The app will choose a balanced investment portfolio for you based on your answers.
Next you need to link a bank account. You won’t be able to set reoccurring investments or round up investments without one. If you have multiple bank accounts, you can link all of them to really maximize your round ups.
Acorns asset allocations
Acorns may not be so great for skilled investors who really like to do their own research and want to know exactly what all of their holdings are. Acorns doesn’t provide that information.
What Acorns does tell you is your allocation between small caps, large caps, emerging markets, real estate, international stocks, and bonds (both corporate and government). This is great for novices, you don’t have to do tons of research on stocks or mutual funds to decide which to invest in. The app does it for you. And it shows you a fancy graph of your allocations!
Types of accounts
There are two different types of Acorns accounts, and you can set up both if you would like. There is the Acorns core account, which is the one you will automatically get when you sign up for Acorns, and then there is the Acorns Later account, which is basically an IRA (Individual Retirement Account). I think it’s awesome that Acorns decided to offer an IRA feature; since so many people don’t have access to 401Ks through their employers, and don’t have enough money to start investing in traditional IRAs.
Ways to Invest
A great thing about Acorns is that they have tons of different ways for you to invest. Whether you are a shopper or a saver, an auto-pilot investor or an active investor, Acorns has an option for you.
My favorite way to invest with Acorns is through their round ups feature. The funny thing about this is that I hesitated to use round ups because of it! I generally use cash for all of my purchases, so I didn’t think it would be useful. Oh how wrong I was!
You see, the round ups feature isn’t just for debit card purchases. Acorns can find round ups to invest from any purchase – I’ve rounded up my monthly internet, phone, and insurance bills to add money to my Acorns account! Another great thing about the Round ups feature is that you can chose whether or not to automate it. I’ve chosen to automate and round up all of my purchases, but you can manually choose which purchases to round up as well.
You can also set up a reoccurring investment from your bank account into your acorns account every week. The reoccurring investment can be as little as five dollars a week and as much as twenty dollars a week. This is an easy way to automate your investments.
If you don’t have the cash in your budget to set up a reoccurring weekly investment, you can also manually invest any amount over five dollars as a one-time investment. You can do this as little or as often as you’d like. It’s a great way to put part of that bonus or tax refund to work for you!
Investing by Shopping Online
A super cool feature of Acorns (that I don’t really use because I don’t do a lot of online shopping, but it’s really freaking awesome for those who do!) is that you can get cash back to invest from shopping online through certain retailers. It’s basically like E-bates, but instead of getting cash back in your pocket, the money gets put into your Acorns investment account. Tons of stores have partnered with Acorns to help you invest – Air B&B, Amazon, Express, Barnes & Noble, Bed, Bath & Beyond, World Market, E-bay, and way too many more to list. The offers vary by retailer, so you’ll have to log on to see if what your favorite store offers. You also have to shop through the Acorns app, so you can’t double dip with other cash back apps like E-bates.
Learning about Investing
Another great feature of Acorns is the “Grow your knowledge” feature. This feature not only gives you information on how to use the Acorns app, but there is also a wealth of articles about credit, debt, saving money, and investing basics. This feature also has a curated section of the trending news in investing. It’s a great way to learn more about investing, and can help turn the novice into a pro.
Nothing in this world is free, and acorns is no different. Acorns charges a monthly fee for its services. Most Acorns users will pay only one dollar a month for their account. Acorns Later (the IRA) users will pay two dollars a month.
Once your combined Acorns accounts reach one million dollars, the fee structure changes. Rather than pay one dollar, you will pay .01% of your portfolio value.
Is Acorns right for you?
Acorns isn’t right for everyone. If you aren’t going to invest regularly, either through roundups or through a reoccurring investment, the one-dollar monthly fee will eat away at your holdings rather quickly. However, it’s so easy to do one of those things that this shouldn’t be an issue for most people.
Acorns is the best way for people who don’t make a lot of money to start investing. It’s one of the only programs I’ve seen that allows you to start with as little as five dollars, and invest such small amounts. We all know how difficult it is to save up the three thousand dollars necessary for most mutual funds, and it’s awesome that there is a product available for regular people who may not be able to achieve that.
Get Acorns today
What are you waiting for? Get Acorns today and start investing now! And if you already have Acorns, I’d love to hear about your experience with it!
Melanie launched Partners in Fire in 2017 to document her quest for financial independence with a mix of finance, fun, and solving the world’s problems. She’s self educated in personal finance and passionate about fighting systematic problems that prevent others from achieving their own financial goals. She also loves travel, anthropology, gaming and her cats.