Acorns Review – Is Acorns Right For You?
Acorns is a micro-savings and investment platform that rounds up daily purchases to the nearest dollar, and invests your spare change into a diversified portfolio. Its customers include minors, college students and young families who may be new to investing or have a hard time saving money.
Acorn’s mission is to make it easy for people to save and invest by rounding up purchases and using modern portfolio theory to manage your investments. The company has a strong focus on saving for retirement and also offers a family plan to help kids learn the importance of savings.
The app allows users to link their credit and debit cards and then round up their purchases whenever they make a purchase. When the round-ups reach a certain amount, they are automatically transferred to their investment account. The app also includes the ability to set up recurring deposits from bank accounts or payrolls.
As with other robo-advisors, Acorns has a tiered-fee structure. In addition to a monthly fee, clients pay an annual management fee that depends on their balance. Depending on the plan you choose, your fee can range from $3 to $5 a month.
On lower balances, the fees are more than enough to eat into your savings. If you have a small balance, it’s best to look for a cheaper option that will allow you to build up your account quickly without having to pay so much in fees.
For instance, Betterment charges just 0.03% per year for its core taxable account, while its family-focused options charge just 0.12%. It also has no minimum account balance, so there’s no reason not to use it if you want to get started with a robo-advisor.
In contrast, Acorns’ personal tier costs $36 a year. That doesn’t sound like much, but if you have a few hundred dollars in your account, that can quickly add up.
Acorns also requires a minimum of $5 to open an account, and it will take 1-3 days for your money to be deposited into your account. While this isn’t a huge issue, it is something to be aware of.
Another major downside to Acorns is that it doesn’t offer phone support, only live chat and email. This is a big problem for some consumers, especially those who prefer to talk to a real person about their finances.
The company’s website is very easy to navigate and it offers a wealth of information about the company and its services. The company also has a blog and social media channels, which is helpful for people who want to stay updated on the latest news.
When it comes to customer service, Acorns isn’t the best. Its customer service representatives only answer via email, and it doesn’t offer a call-in feature or live chat. However, the company’s response time is relatively quick, averaging one to two days, according to CEO Noah Kerner.
Acorns’ low-cost, robo-advisor platform is a great way for people who don’t know much about investing to start making their savings grow. But it does require some commitment, and you need to make sure your investments are diversified and growing steadily.