What is Acorns Com?
Acorns Com is a financial technology company that offers a mobile application that allows users to invest their spare change automatically. The app rounds up every purchase made on linked debit or credit cards to the nearest dollar and invests the difference in a portfolio of exchange-traded funds (ETFs).
How Does Acorns Com Work?
To start using Acorns Com, users need to download the app, create an account, and link their bank account or debit/credit card. Once the account is set up, the app will start rounding up every purchase made on the linked card to the nearest dollar and invest the difference in a portfolio of ETFs. Users can also set up recurring or one-time investments.
What are the Fees?
Acorns Com charges a flat monthly fee of $1 for accounts with a balance below $5,000 and 0.25% per year for accounts with a balance above $5,000. The app also offers a checking account with no overdraft fees, no minimum balance requirements, and no ATM fees at over 55,000 locations.
Benefits of Acorns Com
Acorns Com offers several benefits, including:
1. Easy Investing
Acorns Com makes investing effortless by automatically rounding up every purchase and investing the difference. Users can also set up recurring or one-time investments to grow their portfolio.
2. Diversification
Acorns Com invests in a portfolio of ETFs, which provides diversification and reduces risk. The app also offers several portfolios based on the user’s investment goals and risk tolerance.
3. Low Fees
Acorns Com charges a flat monthly fee of $1 for accounts with a balance below $5,000 and 0.25% per year for accounts with a balance above $5,000, which is relatively low compared to traditional investment options.
4. Acorns Com Later
Acorns Com also offers a retirement account option called Acorns Com Later, which allows users to invest in a portfolio of ETFs for their retirement.
Drawbacks of Acorns Com
While Acorns Com offers several benefits, there are also some drawbacks to consider, including:
1. Limited Investment Options
Acorns Com only offers a portfolio of ETFs, which may not be suitable for all investors. Users cannot invest in individual stocks, bonds, or other investment options.
2. Limited Control
Acorns Com automatically invests the spare change, which means users have limited control over their investments. Users cannot choose which ETFs to invest in or when to buy and sell them.
3. Minimum Balance Requirement
Acorns Com requires a minimum balance of $5 to start investing, which may be a barrier for some users.
Is Acorns Com Safe?
Acorns Com is a safe and secure platform that uses bank-level security and encryption to protect users’ data and investments. The app is also a member of the Securities Investor Protection Corporation (SIPC), which protects users’ investments up to $500,000.
Final Thoughts
Acorns Com is a user-friendly and convenient way to start investing, especially for beginners or those who struggle to save money. The app offers several benefits, including easy investing, diversification, low fees, and a retirement account option. However, users should also consider the drawbacks, such as limited investment options, limited control, and a minimum balance requirement. Overall, Acorns Com is a good option for those looking for a hassle-free way to invest their spare change.
