Acorns App?

[alaskacobalt]

I have been using a relatively new app now called Acorns for a little over a month now and really like it.  It basically monitors whatever accounts you have that you want monitored and will take your transactions and round up to the nearest dollar, then when it hits $5, it will pull that from a designated account and put it into your portfolio.  You can also set it to automatically pull money, daily, weekly, or monthly.  A lot like a 401k really, but somewhat simplistic on features.

Has anyone else been using this?  I'm curious what kinds of results people have seen.  I have only had it for about a month or so like I said and have about $200 in the account.  It's hard to really gauge how well you are doing because of the regular microtransactions, but I figure I have made about a 10% return so far... but a month isn't exactly a very telling amount of time.

[ken]

I don't follow the logic on this. All you are doing is transferring money from one account to another. You haven't really 'gained' anything. Maybe you are psychologically fooling yourself because you don't see the money leave your spending account. That is similar to automatic investing. Do what you have to in order to set money aside but don't confuse that with a return on an investment. Your actual return will be the return of fund or asset the money gets invested in.

[BEN_BANNED]

but I figure I have made about a 10% return so far... but a month isn't exactly a very telling amount of time.

I've been using Acorns for about as long as you have and have about a 2% return so far.

What's your allocation?

[GGNoob]

The only problem with Acorns is the fees. $1 a month and 0.50% of assets. If you only have $25 of round-ups a month, that $1 acts as a 4% load fee.


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[wtjbatman]

I don't follow the logic on this.

I have no interest in this app, because I have gotten started and created a solid investment plan already, and don't need to try and save pennies on the side. Buuuuut... really, you don't follow the logic at all? You don't see the value to someone who hasn't yet learned to save and invest, or to someone who finds it difficult to transfer $200 a month into their savings but really just needs this kick in the pants to get going?

You brought up the best reason in your post. It's a psychological thing. Which is what nearly all investment advice is about. For example, if the point of investing while in the accumulation phase is total return, then everyone should be 100% stocks (or possibly 90/10 or 80/20). Yet many people are 70/30 or 60/40. Why is that? Because of risk aversion. There is no logic there, it's all about emotions. People can be emotional when they "lose" money, so they invest more in bonds so that when equity markets drop they feel like they aren't losing as much money.

That's the idea behind this app. It's not for us, it's for those who haven't yet made the plunge into saving/investing.

[BEN_BANNED]

The only problem with Acorns is the fees. $1 a month and 0.50% of assets. If you only have $25 of round-ups a month, that $1 acts as a 4% load fee.


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Yep, the fees are pretty steep.

One of the positives of the app is it allows you get into a broad array of ETFs for only $5. Once you accumulate some money in your Acorns account you can simply withdraw it and open a Vanguard brokerage account.

I'm simply trying to get a better return on a small amount of money than I would from my bank's saving account. So far so good.

[GGNoob]

The only problem with Acorns is the fees. $1 a month and 0.50% of assets. If you only have $25 of round-ups a month, that $1 acts as a 4% load fee.


Sent from my iPhone using Tapatalk

Yep, the fees are pretty steep.

One of the positives of the app is it allows you get into a broad array of ETFs for only $5. Once you accumulate some money in your Acorns account you can simply withdraw it and open a Vanguard brokerage account.

I'm simply trying to get a better return on a small amount of money than I would from my bank's saving account. So far so good.

But you can do that with $10 for free at Wisebanyan or for a 0.35% fee at Betterment.

[BEN_BANNED]

The only problem with Acorns is the fees. $1 a month and 0.50% of assets. If you only have $25 of round-ups a month, that $1 acts as a 4% load fee.


Sent from my iPhone using Tapatalk

Yep, the fees are pretty steep.

One of the positives of the app is it allows you get into a broad array of ETFs for only $5. Once you accumulate some money in your Acorns account you can simply withdraw it and open a Vanguard brokerage account.

I'm simply trying to get a better return on a small amount of money than I would from my bank's saving account. So far so good.

But you can do that with $10 for free at Wisebanyan or for a 0.35% fee at Betterment.

I already have a WiseBanyan account that I funded with money from my closed Betterment account. LOL!

At this point I'm just playing around with the Acorns account. My opinion of it might change in 6 months or so.

[ClaycordJCA]

Why not simply set up monthly, automatic electronic transfers from your checking account into a brokerage account?  I do that with Fidelity and ETrade. I'm sure Vanguard has the same feature. Same concept, but no fees.

[BEN_BANNED]

Why not simply set up monthly, automatic electronic transfers from your checking account into a brokerage account?  I do that with Fidelity and ETrade. I'm sure Vanguard has the same feature. Same concept, but no fees.

Not everyone has the coin for the initial amount to open a brokerage account.

With Acorns the $5 here and the $5 there  with no trading commissions adds up over time.

[mustachianism_is_aredpill]

Wachovia (RIP) used to have a Way 2 Savings account that did something similar. Every time you use your debit card, they transferred $1 from your checking account to your Way 2 Savings account. The treat: the account earned 5% interest!

Caveats:

1. The only way to put money into your Way 2 Savings account was $1/debit card transaction and up to $100/monthly otherwise (I set up an auto-transfer)
2. The 5% interest was only for the first year. After that, it reverts to a much lower interest rate
3. The account wasn't FDIC insured

Unfortunately Wells Fargo gutted the program after taking over. You get peanuts on that account now, so I shut mine down.