Investing for the future can be hard for a twenty-something. With restrictions like minimum account balances and commission fees that make it uneconomical to invest a few hundred bucks at a time, investing can almost feel impossible.
Until today. Acorns is officially launching on the App Store to help anyone invest right from their smartphone.
Acorns works by letting you connect your credit or debit cards (with a simple sign-up using your online bank credentials), and automatically rounds up the change from every purchase to add to your investment portfolio. You can choose between five different risk options, from aggressive to conservative, and watch how your investments are performing over time.
At any time, you can make a deposit into your investment account and/or switch around the risk profile of your portfolio to be more or less aggressive. All of the five different portfolios are compiled by a team of investment analysts, mathematicians, and economists. Users also have the option to take money out of their investment portfolio whenever they need it.
Because Acorns is connected to your actual bank account, it has the ability to look for cash rebates from banks and can also be integrated with loyalty programs to invest the value from those accounts.
You can also go through and manually add every “round up” to your investment portfolio if you wish to monitor how much you’re putting into your portfolio. For those who don’t care to follow along, there is a default setting that will automatically invest on your behalf.
Acorns makes money by charging a monthly $1 fee for every active investment month, as well as a management fee that ranges from .5 percent to .25 percent, depending on how much you’re investing.
In the 10 weeks that the company has been in beta, it has acquired around 10,000 users who are investing in the platform. On average, users are investing around $3/day in roundups alone, and portfolios have expected returns ranging from four to nine percent annually.
Acorns has raised a total of $8.3 million, with their $6.2 million Series B closing in March.