Rewards When You Spend
Acorns members have access to a Chrome browser extension that helps you earn points while you spend. You can also earn points by looking for a job or inviting friends. More than 12,000 partners participate in this program, so chances are, youll be earning rewards for activities youd be doing anyway.
Acorns Review 202: How Does Acorns Work And What Are The Fees
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Do you remember the piggy bank most kids used to have, or probably still keep even now?
Where would you drop all your spare coins in the hope that they would come in handy on a rainy day?
Think of Acorns investment app as a digital piggy bank, and a better one at that because it is an investment platform, not a savings one.
Moreover, it is likely to come through for you in a bigger way on that rainy day than the good old piggy bank could.
To put it differently, Acorns is doing to the piggy bank what email did to the post office mail.
In this Acorns review, we will be delving deeper into this app to find out more about how it works, and how you can utilize it to transform the idea of investing from a big decision to a small one.
Acorns Review 202: Pros Cons And How It Compares
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The investing information provided on this page is for educational purposes only. NerdWallet does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks or securities.
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Final Thoughts On Acorns
The genius of the Acorns investment app is and has always been the ingenious way they found of helping masses to invest their spare coins in a simple and stress-free manner.
Up until then, entry into the investment market was paved with numerous barriers in the form of prohibitively high fees and buy-in prices.
How To Open An Acorns Spend Account
Log in to your existing Acorns account. The fastest way to sign up for Acorns Spend is if you are already an Acorns customer. If you log in to your account, you can pre-order the Acorns Spend debit card in a few clicks. The first 100,000 Acorns Spend debit cards sold out in four days, but the company is still accepting pre-orders for additional cards as of February 8, 2019.Open an Acorns account online. If youre not already a customer, youll have to sign up for an Acorns account to access Acorns Spend. You can access the application at this link. Once there, click Dont Have an Account? Youll need to provide your email address and create a password to open an account.
To finish opening your account, youll need to connect your spending cards, such as your debit and credit cards, so that Acorns can set up the round-up portion of the process. Next, youll provide personal information, such as your address and Social Security number. The last step of the process is to choose your investment allocation.
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How Are Acorns And Robinhood Different
The most blatant difference between the two must be that Acorns offers only managed portfolios and is a hands-off investing platform while Robinhood is a do-it-yourself, rolled-up sleeves investing kind of app.
Acorns also charges a monthly fee to access their service, while Robinhood, you can use for free, although they do have a $5/m premium account.
Furthermore, Robinhood still doesnt have phone support or human and robo-advisors, while Acorns has phone support but doesnt have live chat, or human advisors.
Acorns is different in that its geared towards passive investors while Robinhood is for active ones.
How Does Acorns Spend Work
The original Acorns investment app was built around the idea of round-upsi.e., rounding up the spare change left over after each purchase, and depositing that change into an investment account where it could earn money and add up to big bucks over the years. Users manage round-ups from within the app, by either manually approving each purchase to round up or by enabling automatic round-ups . These round-up funds are then set aside until a balance of $5 is reached, at which point the money is transferred from your checking account to your Acorns portfolio
Where Acorns Spend is different is in the real-time aspect of the round-ups. While the traditional Acorns user must wait until their round-up balance reaches $5 before the funds are transferred and invested, users of the card will have their round-up funds transferred immediately into their accounts following a purchase. Though this seems like a small improvement, over the course of a few years or decades, this can have a tremendous impact on investment growth: The longer your money is in the market, the longer it can grow.
But beyond this, Acorns Spend comes with a number of other perks designed to help customers save and invest even more money, putting it in competition with the big banks.
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Acorns Features & Services
To boost your Acorns balance, you can set up recurring deposits of larger amounts, get referral bonuses and earn extra cash to invest by shopping through Found Money, the core Acorns appâs rewards program, though these features arenât as heavily advertised as the opportunity to invest your change. The services are popular, however, says Acorns CEO Noah Kerner, with a typical customer investing over $60 per month.
âThe majority of our customers take advantage of Acornsâ full suite of tools and services, making the small $1 per month subscription quite reasonable,â Kerner told Policygenius in a written statement.
Acorns’ other services include:
Acorns Later:Acorns Later is an individual retirement account available to Acorns investing app users. People who open an IRA through Acorns Later pay $2 a month for both accounts.
Acorns Spend: Acorns also has an FDIC-insured checking account plus debit card, called Acorns Spend, that its Core users can pre-order. You pay $3 a month if you have Acorns, Acorns Later and Acorns Spend.
Found Money: Acorns has a cashback program that’s a bit similar to one you might see with a rewards credit card. If you make a purchase through an Acorns Found Money partner, that company will automatically invest in your Acorns portfolio.
Watch Your Money Grow Over Time
Even to the novice investor, it is common knowledge that you reap what you sow, and if you sow sparingly, then sparingly you shall reap.
It is therefore encouraged that you go above and beyond just doing the bare minimum.
As much as you possibly can, aim at having a set amount invested on a recurring basis in order for you to gain tangible returns.
This is also a great way to put a check on overspending and enforce more discipline on investing.
It also enables you to deposit lump sum amounts of money manually for investment whenever needed.
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Tips For Finding An Advisor
- Acorns doesn’t provide many features for investors who have more complex financial situations. If you have multiple types of investments or want to build a financial plan, you may want to talk to a financial advisor. SmartAsset’s free tool can match you with up to three advisors in your area. Get started now.
- The rise of robo-advisors has coincided with a bull market. But what do the algorithm-driven advisors do when there’s a major downturn? The general wisdom is not to panic when things head south, but an automated system of rebalancing may sell when prices are low.
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Get Your Unique Portfolio
Acorns will then ask you a set of investor questions which you do not have to rack your brains over.
The next set of questions will assist Acorns in recommending the right kind of portfolio for you.
Based on the answers you provide, Acorns will give a breakdown of how your investments will be diversified according to the recommended portfolio.
Most users will find themselves on the moderate recommendation.
This is not cast in stone, however you can change your portfolio at any time.
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Should You Use Acorns Spend
| You might like Acorns Spend if you … | You might not like Acorns Spend if you … |
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The bottom line: You may like Acorns Spend if you want to automatically save and invest spare change from your regular purchases.
How To Open An Acorns Account
Any US resident over 18 with an SSN number can open an Acorns account. You can register online or download the Acorns app.
Youll need to input some basic information about you and link your bank account to fund the account and use the round-up spare change feature.
Acorn will recommend a portfolio to you based on the information that you provide. Things like your occupation and earnings, as well as financial goals.
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The Cons Of An Acorns Spend Account
- You’ll pay $3 per month. Although Acorns Spend doesn’t come with ATM, foreign transaction, or overdraft fees, it does include a $3 monthly fee. On the bright side, Acorns Spend includes access to Invest and Later accounts. Acorns charges $1 per month for an Invest account and $2 per month for an Invest and Later account.
- There are no joint accounts. With many banks, you can set up a joint checking account with a partner or family member. However, you don’t have the ability to do this with Acorns Spend yet.
- There’s no ATM network. Yes, Acorns reimburses all ATM fees charged by ATM providers at the end of the month. However, if you use ATMs frequently, then you may find it annoying that Acorns doesn’t have an ATM network with machines you can use for free. Other banks have an ATM network so you can access a machine without being charged a fee.
- There are no physical locations. Acorns operates entirely online. If you prefer speaking to your banker face-to-face, it might not be the best fit.
Why Is Plaid Involved
Some people have asked us how we connect their financial accounts to apps like Venmo and Acorns. Canât Venmo just do it? Or my bank?
CHALLENGE
There are more than 11,000 financial institutions in the US, but they structure and manage their data in many different ways.
For an app that wants to enable users to connect their financial accounts, building a digital connection to a single financial institution can take a lot of engineering time and expertise. Now imagine doing that thousands of times. For many companies, itâs not feasible.
SOLUTION
At Plaid, we work around the clock to build and maintain secure connections to more than 11,000 US financial institutions.
Plaid lets you connect your financial accounts to apps and services to help them provide products and services to you. These apps can help you do things like manage your money and make progress toward your financial goals.
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Full Suite Of Checking Features
Youll get all the modern features you expect from a checking account, including:
- Mobile check deposit.
- Funds transfers between accounts.
- Account monitoring.
You can also easily move money to your investments or retirement savings directly in the app, or with a couple of taps on the screen, set up Round-Ups and recurring deposits, and manage Smart Deposit.
Who Should Choose Acorns
The robo-advisor features of Acorns make the most sense for someone who is drawn to the platforms round-up savings claim-to-fame: Purchases made in linked accounts are rounded up to the nearest dollar, and the balance is saved in an investment account.
If you spent $4.50 on a latte on a linked credit card, for instance, an additional $0.50 would be charged to your card and added to your investment account. If youve experienced joy with this pro-savings gimmick, you may be inclined to save for retirement with Acorns as well.
Still, competing robo-advisors provide more robust services at a lower cost. Only users who think theyll be enticed to save more with Acorns need apply.
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Nature Of A Bank Account
In most legal systems, a deposit of funds in a bank is not a bailment – that is, the actual funds deposited by a person in a bank cease to be the property of the depositor and become the property of the bank. The depositor acquires a claim against the bank for the sum deposited but not to the actual cash handed over to the bank. In accounting terms, the bank creates an account in the name of the depositor or a name directed by the depositor in which the amount received by it is recorded as a transaction. The deposit account is a liability of the bank and an asset of the depositor .
On the other hand, a bank can lend some or all of the money it has on deposit to a third party/s. Such accounts, generally called loan or credit accounts, are subject to similar but reverse principles of a deposit account. In accounting terms, a loan account is an asset of the bank and a liability of the borrower. Loan accounts may be unsecured or secured by the borrower, and they may be guaranteed by a third person, with or without security.
Each financial institution sets the terms and conditions for each type of account it offers, and when a customer applies for the opening of an account, and accepted by the institution, they form the contract between the financial institution and the customer in relation to the account.
How To Get An Acorns Spend Debit Card
If youre thinking about signing up for Acorns Spend, you should consider doing so sooner rather than later. Only 100,000 cards were set to be produced in the first run, and more than 25,000 customers signed up on the first day. The rest of the 100,000 first run cards were swept up in the weeks after the program was announced. But Acorns Spend is accepting new applicants on a rolling basis, so you can still sign up.
I personally signed up as soon as I heard, claiming my spot.
Luckily, signing up is easy. All you need to do is log into either the Acorns app or online account, click on the Acorns Spend tab, and you can opt in. If youre in the app, youll use your finger to submit your signature for record, which will be placed on the back of the card .
The one downside? It can take some time to actually receive your card. Being made of Tungsten, then take more time to manufacture and produce. Though I signed up for my card the day the program opened in June, I didnt actually receive my card until November . Hopefully, this process gets a little bit faster as the program ages and their supply chain irons itself out.
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Acorns Spend Fees: How Much Does Acorns Spend Cost
After that, Acorns offers three different pricing models:
- Lite: For $1 per month, you gain access to Acorns Invest and Found Money
- Personal: For $3 per month, you gain access to Acorns Invest, Found Money, Acorns Later, and Acorns Spend
- Family: For $5 per month, you gain access to Acorns Invest, Found Money, Acorns Later, Acorns Spend, and Acorns Early
In order to open an Acorns Spend account, you must be on the Personal Plan, at a cost of $3 per month.
How Acorns Reports Diversity & Inclusiveness
As part of our effort to improve the awareness of the importance of diversity in companies, we offer investors a glimpse into the transparency of Acorns and its commitment to diversity, inclusiveness, and social responsibility. We examined the data Acorns releases. It shows Acorns does not disclose any data about the diversity of its board of directors, C-Suite, general management, and employees overall. It also shows Acorns does not reveal the diversity of itself by race, gender, ability, veteran status, or LGBTQ+ identity.
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What Should I Look Out For
The Acorns Spend account has these drawbacks.
- Invest account required. You must have an active Acorns Invest account to open Acorns Spend account. If you dont already have an investment account, you can open one at the same time you open your Spend account.
- Unavoidable monthly fee. Youll pay $1, $3 or $5 a month for Acorns, but this is a flat fee that covers your investment account, retirement account, checking account and potential kids accounts. Most traditional banks charge at least $5 for checking only, making Acorns relatively inexpensive.
- Lacks certain features. Unlike most accounts offered by investment platforms, this one doesnt come with a savings feature or the ability to earn interest.
- No joint accounts. You cant open an Acorns Spend account with a partner or family member.
If youre not in the market for an investment and retirement account, consider these checking account options.