Investing doesn’t must be sophisticated (or costly). Each Acorns and Robinhood have figured this out, and supply intuitive cell apps which are really easy to make use of, even a caveman new investor can determine it out.
Acorns is an automatic investing app that rounds up your spare change and invests the distinction. Robinhood is the unique no-fee inventory buying and selling app that compelled the whole monetary trade to observe go well with, serving to decrease charges throughout the board, and, of their phrases, “democratize finance for all.”
Each Acorns and Robinhood supply low-cost investing and entry to ETFs that carry low charges. They’re each designed for newbies, however which one is healthier for you?
We’ve reviewed the options, charges, buying and selling instruments, accessible belongings, customer support, and safety that can assist you discover out which buying and selling platform is best for you.
Acorns vs. Robinhood overview
Each Acorns and Robinhood supply entry to a big selection of ETFs for diversified investing. In addition they each supply recurring investments, permitting you to purchase investments on an everyday schedule.
Acorns connects to your monetary accounts, rounding up purchases to the closest greenback, investing the distinction.
Robinhood presents fee-free buying and selling of shares, ETFs, choices, and crypto.
Acorns | Robinhood | |
---|---|---|
Buying and selling charges | Buying and selling isn’t accessible in Acorns accounts | ● No charges on shares, ETFs, choices, or crypto trades ● Robinhood does acquire a “unfold” charge, which is the distinction between the purchase and promote worth of a commerce |
Account charges | Private – $3 per thirty days
Household – $5 per thirty days |
● $75 switch out (partial/full) ● $5/month for Robinhood Gold |
Tradable belongings | Acorns portfolios are constructed with a mixture of ETFs. Particular person shares, bonds, or different investments usually are not accessible. | ● Shares ● ETFs ● Choices ● American Depositary Receipts (ADRs) ● IPOs (for sure corporations) ● Cryptocurrency |
Account minimums | $0 to open ($5 to take a position) | $0 |
Cell app accessible? | Sure | Sure |
Training | Monetary literacy content material powered by CNBC (Develop Journal) | Information feed, primary articles, and movies |
Customer support | Cellphone and electronic mail help seven days every week, 6:00am to 7:00pm PST | 24/7 electronic mail, social media, and skill to request a telephone name inside app |
About Acorns
Acorns is a robo-advisory service that means that you can spherical up your purchases to the closest greenback, and deposit these funds into an funding account. As soon as the stability reaches $5, the funds will probably be invested in a pre-selected funding portfolio.
Acorns presents 5 portfolio choices based mostly on threat tolerance, starting from conservative to aggressive. It additionally presents 4 completely different Environmental, Social, Governance (ESG) portfolios for buyers seeking to spend money on funds that adhere to ESG standards. These portfolios include a mixture of broadly diversified ETFs that carry low annual charges and a big selection of investments.
Learn extra: Socially accountable investing: how you can change into a aware investor
Acorns costs a month-to-month charge for his or her service, and presents two plan choices for buyers:
- Private. This account costs $3/month and provides you entry to a taxable funding account, Particular person Retirement Account (IRA), and a checking account. You should utilize the round-up characteristic on the app, in addition to entry money again with accomplice manufacturers by the app.
- Household. This account costs $5/month and contains all the pieces within the private plan, plus entry to an funding account for youths (custodial account).
Total, Acorns is a stable app for newbie buyers who need to automate their long-term investments, together with the flexibility to take a position small quantities by the round-up characteristic.
Attempt Acorns or learn our full evaluation.
About Robinhood
Robinhood is a well-liked inventory and crypto buying and selling app that gives entry to fee-free shares, ETFs, choices contracts, and crypto buying and selling. You may as well entry margin to commerce with leverage, a characteristic sometimes reserved for accredited buyers, however accessible to common buyers on Robinhood.
Learn extra: How you can spend money on cryptocurrency: a newbie’s information
Observe: whereas the “no buying and selling charges” characteristic sounds nice, Robinhood does cost a hidden charge referred to as a “unfold” charge, which is the distinction between the purchase and promote worth of an asset. This may find yourself costing you extra, as you find yourself overpaying once you purchase, and promoting for lower than the market worth of your asset.
The Robinhood cell app is without doubt one of the best investing apps to make use of for newbies, with built-in tutorials on how you can place trades, simplified charts and pricing data, and a super-simple order type. Robinhood additionally presents choices buying and selling throughout the app, however makes it straightforward for brand new buyers to know. Along with the U.S market, Robinhood presents entry to over 600 worldwide investments through American Depository Receipts (ADRs).
Total, Robinhood does battle with transparency round its charges, however remains to be an honest buying and selling platform for newbies. Simply don’t get margin-called whereas investing at max leverage in PNW Reader shares!
Attempt Robinhood or learn our full evaluation.
Acorns vs. Robinhood funding efficiency
Each Robinhood and Acorns supply entry to hundreds of ETFs, and Robinhood presents particular person shares and crypto investing. However how do these investments carry out? The efficiency of any funding portfolio will fluctuate based mostly on the investments chosen, and most customers may have a differing funding choice.
Whereas Robinhood doesn’t supply standardized portfolios, Acorns does supply pre-built funding portfolios based mostly on threat tolerance. These portfolios are constructed with a mixture of low-cost ETFs that assist customers diversify their investments with minimal charges.
Learn extra: How you can spend money on ETFs
Sadly, Acorns doesn’t share their portfolio efficiency knowledge publicly, however you’ll be able to see what investments every portfolio consists of on the Acorns website.
Acorns professionals & cons
Execs
- Spherical-up characteristic to take a position spare change.
- Automated funding administration.
- Earn money again when utilizing the Acorns procuring portal.
Cons
- No crypto or inventory buying and selling accessible.
- Month-to-month charge is dear for smaller accounts.
- $50 per ETF charge for transferring to a different agency.
Robinhood professionals & cons
Execs
- No-fee buying and selling.
- Entry to particular person shares and crypto.
- No account minimums.
Cons
- Unfold charges usually are not clear.
- No automated portfolio administration.
- $75 outbound switch charge.
Why select Acorns
Easy cell app
Acorns is an app that avoids sophisticated investing jargon and makes it easy to commonly make investments, even when making day by day purchases. If you would like a set-it-and-forget-it strategy to your long-term investing, the Acorns app makes it straightforward.
Automated investing
Managing your investments might really feel overwhelming, however Acorns is constructed to maintain the main points for you. With the flexibility to arrange recurring investments, automated rebalancing of your portfolio, and pre-built portfolios of diversified, low-cost ETFs, Acorns automates probably the most painful components of investing.
Earn bonuses
Acorns has partnered with over 12,000 main retailers, providing money again bonuses for procuring by the Acorns app, or utilizing the free Chrome extension. When procuring on-line, you’ll be able to activate a bonus supply, and obtain money again that’s deposited into your Acorns account, and invested into your portfolio.
Attempt an investing account with Acorns.
Why select Robinhood
No-fee investing
Robinhood presents no-fee buying and selling on particular person shares, ETFs, choices contracts, and American Depository Receipts (ADRs) for worldwide investing. However bear in mind there’s a unfold charge collected, which can end in overpaying for an funding.
Entry to crypto
Robinhood is without doubt one of the few inventory buying and selling apps that means that you can spend money on crypto instantly, providing entry to Bitcoin (BTC), Ethereum (ETH), and some different crypto decisions. Additionally it is launching a cryptocurrency pockets in 2022, permitting you to take direct custody of your crypto.
Margin buying and selling
Robinhood presents entry to margin for buyers who’ve a $2,000 account stability (or extra). Whereas this will likely seem to be a steep requirement, most different corporations require accredited investor standing to entry margin, which implies you make $200k per yr, or have $1 million internet price (exterior of your main residence). So a $2k minimal is pretty beneficiant, as are the rates of interest on margin balances.
Attempt an investing account with Robinhood.
Abstract
Each Robinhood and Acorns are designed to assist newbies begin investing. Each supply low charges and entry to a variety of ETFs to assist construct a diversified portfolio of funding.
However whereas Robinhood is designed for energetic merchants who need entry to particular person shares, crypto, and choices buying and selling, Acorns presents a extra passive strategy to investing by automating the method with pre-built portfolios and mechanically investing your spare change.
Robinhood presents a easy manner for brand new buyers to entry hundreds of belongings to commerce for no charges, in addition to extra superior buying and selling options like margin buying and selling and choices buying and selling. Acorns, then again, presents absolutely managed funding accounts that target investing small quantities over time.
Energetic merchants and people who need to attempt their hand at choices or crypto buying and selling will profit from Robinhood’s intuitive buying and selling interface and charge construction, whereas new buyers who need to save for retirement in small quantities might profit from Acorn’s simplified investing strategy.
Featured picture: M M Vieira/Shutterstock.com
Advertiser Disclosure – This commercial comprises data and supplies supplied by Robinhood Monetary LLC and its associates (“Robinhood”) and MoneyUnder30, a 3rd celebration not affiliated with Robinhood. All investments contain threat and the previous efficiency of a safety, or monetary product doesn’t assure future outcomes or returns. Securities supplied by Robinhood Monetary LLC and Robinhood Securities LLC, that are members of FINRA and SIPC. MoneyUnder30 isn’t a member of FINRA or SIPC.”