Stocks can be an intimidating concept, conjuring images of suited men in route to Wall Street and the New York Stock Exchange. Stocks and investing – once complex topics – are now being made easier and more accessible to those who want to participate without a trip to a stockbroker, especially for young adults.
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Acorns is an American financial technology and financial services company based in Irvine, California, that specializes in micro-investing and robo-investing. As of 2019, the app had over 4.5 million users and over $1.2 billion in assets under management.
Acorns have modernized the old-school practice of saving the loose change, merging the robo-advisor model with an automated savings tool. It charges $1 a month for a taxable investment account, $2 a month to add on an individual retirement account, or $3 a month for an Acorns checking account — called Acorns Spend — plus investment and retirement accounts.
Acorns is free for four years for college students with a valid .edu email address. The app has partnered with more than 350 companies — including Apple, Hulu, Amazon, and Airbnb — to give you cashback when you use a linked payment method at one of the partners. In most cases, you get the cashback automatically, without an additional step. You simply use a card linked to an active Acorns account to make the purchase, and the Found Money rewards will land in your account in 60 to 120 days.
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Robinhood Markets, Inc. is a U.S.-based financial services company headquartered in Menlo Park, California. It allows individuals to purchase cryptocurrency and invest in public companies and exchange-traded funds listed on U.S. stock exchanges without paying a commission. In the future, Robinhood plans to offer banking products.
Robinhood uses instant verification with many major banks, sparing users the hassle of reporting micro-deposits to an account to verify the information.
Both of these apps are geared toward college students for the simple reason of time. College students typically have more expendable income in comparison to older individuals with other familial responsibilities, meaning the former age group has more money to set toward investment.
Swings in the market are expected, but for those who seek to reap their gains through stock returns, there is always the looming risk of a market recession similar to the one in 2008.
Stash is similar to Acorns but differs in that Acorns invests for you automatically, whereas Stash helps you learn how to make good investment decisions yourself. The app provides educational content that is customized to the user’s investment preferences. Users can choose between values-driven portfolios based on distinct investing themes or build a custom portfolio.
Stash accounts start at $1 but may be subject to fees depending on individual investments of choice.
Acorns, Robinhood and related apps have allowed college students to learn about their economy and take part in it as well through the accessible platform of smartphones. These apps have managed to simplify the complex and intimidating concept of investment and appeal to the younger generation. Not only does it apply the benefit of multiplying our money, but it also promotes their financial knowledge and responsibility in a way that fits into their busy college schedule without consuming too much of their time and energy.