💸How to Start Investing with Acorns App

Today I want to share with you an app that enables me to automatically allocate and invest part of my savings. Most Americans aren’t saving nearly as much as they should be for retirement. Maybe because they feel like they need most of the money they earn now? Or just haven’t taken the time to sit down and track their expenses to get a good idea of the possibility of savings. Let’s face it, sitting down and doing this can be intimidating but it is crucial for our financial futures. The more you do it, the more you’ll realize how much more you can be saving and eventually it can become addicting (in a positive way of course!). Tracking your expenses puts you in the drivers seat so that you control your money, your money doesn’t control you.

One of the first financial books that I read dating back to early 2017 titled The Automatic Millionaire by David Bach, described an intriguing concept described by Bach as the “Latte Factor”. This lead me to discovering Acorns.

You know those daily expenses that are small but are spent on things you enjoy like that $3.50 latte from Starbucks Coffee that you use for a pick me up every morning. I agree it’s a great way to start your day. Overtime these small expenses add up to a value called the “Latte Factor”. Millions of Americans are spending small amounts each day not realizing the detriment it is causing to their financial futures. Yes buying that Latte is great, but let’s make that event even more positive by saving that extra 50 cents on the dollar. Nowadays everyone carries around a credit or debit card to make purchases. There’s a disconnect being created between people and their money when making purchases. Back in the day when people spent money and had lose change they would save it in a change jar and at the end of each year they would choose what they wanted to do with that loose change. Either buy Christmas gifts, buy something new they always wanted during the year, or add it to their life savings. With the coming of digital purchases, NO MORE LOOSE CHANGE! This is where Acorns steps in. I discovered this app by reading The Automatic Millionaire, which I highly suggest you read. When you buy that daily latte from Starbucks Coffee, that loose change can automatically be saved to your Acorns account in the form of roundups (I’ll explain what these are in a later section). Once your roundups reach $5 they are automatically invested through what Acorns calls micro investing. This term has really broken down the barrier of people thinking they don’t have enough to invest. With Acorns you can start investing with as little as $5 dollars. You can literally start today it’s that easy! Start taking advantage of the gains you wouldn’t otherwise see in a standard savings account. I’ve been a member of Acorns since 2017 and have seen substantial gains relative to the average bank savings account. I am currently up(+3.32%) since the inception of my account. Most people fear investing in the stock market, but Acorns offers an investment strategy that carries limited risk and you can find peace knowing that your money is lying in a safe place for later while taking advantage of the power of compounding interest.

Once your roundups reach $5 they are automatically invested through what Acorns calls micro investing.

App Features

Portfolio Intensity- Choose the Investment Strategy that you’re most comfortable with. You can change the intensity of your portfolio. It ranges from Conservative, Moderately Conservative, Moderate, Moderately Aggressive, and Aggressive. Acorns will display what percentage of your money is going to their pre-selected investments that include blue chips stocks, bonds, ETF’s etc. Do your do diligence and pick the right investment for you.

Round-ups- With every purchase Acorns automatically invests your spare change through their round-up system. For example: if you go to Starbucks Coffee and spend $3.50 on a latte, Acorns rounds up your spare change to the nearest whole dollar. After that purchase Acorns will allocate 50 cents from your bank account. Once your round-ups reach a total of $5 dollars, Acornswill automatically draft that amount from your bank account. These round-ups will add up over time.

Reoccurring Investments- When setting up your account, one of the requirements to get your account to full strength is to add a reoccurring investment. Acorns recommends doing this as a supplement to your round-up contribution to help your money grow faster. You can select your reoccurring contribution to occur daily, weekly, bi-weekly, or monthly. Choose an amount that works for your budget and feel free to increase/decrease it at any time.

One-time Investments- Have extra cash lying around? Make a one-time contribution to your portfolio at any time. When re-balancing your weekly/monthly budget you’ll be sure to find extra money to add to your savings.

Performance- Acorns keeps track of your portfolio performance. The app will display how well your portfolio is performing daily, weekly, monthly, and yearly. Click on the increments at the bottom of the screen to see your monetary and percentage gains. The performance section also displays a prediction of your portfolio performance, so you can envision future growth. This prediction is calculated by taking account of your reoccurring contribution and historic market trends. It will show you an estimate of how much your account will be worth in the future. Being able to envision this is a great confidence boost in staying on the right investment path.

Withdraw- Users are able to withdraw their investments at any time. Just know that when you withdraw you will be missing out on future investment gains. Try to limit your temptation to tap into your investment gains as much as possible, whether it’s your Acorns account or another retirement savings account. The more money that stays in these accounts, the greater power your money will have to take advantage of compound interest.

Found Money- Acorns has formed partnerships with well known brands that will contribute to your Acorns portfolio when you do business with them. These brands offer to contribute set dollar amounts or percentages based on the amount that you purchase of their products/services. This is basically free money! So before your next purchase peak into the found money section of Acorns to see if a partnership exists with the brand you are considering purchasing from. They also just added a local Found Money as well so search for local businesses in your area that currently participate!

Grow your Knowledge- Acorns knows that most users coming to their platform are new to investing. The reason being, because one of the sayings they use to attract people is “Start investing with as little as $5 today!” Most people think they need a large sum of money to start investing but Acorns micro investing defeats that notion. In the beginning, people won’t know what the best investment strategies are but this knowledge section will help break down some barriers for novice investors.

Signing Bonuses

Every month or so Acorns will offer signing bonuses. So for example if you click this link Start investing with Acorns today! Get $5 when you click here https://acorns.com/invite/G6GPW7. (This is my invite link btw, thank you in advance for helping us contribute to both of our financial futures!) Acorns will reward you for each referral. Get 12 friends to signup within a certain time frame you’ll have the chance to have $1,000 added to your Acorns account during certain promotional periods. The reward is twofold. You’re helping a friend towards their financial future and you gain the potential to add to yours. It’s a win, win!

Acorns Debit

Something new that Acorns added this past year was Acorns debit. I signed up in the spring of 2018 to be one of the first 100,000 recipients of the Acorns debit card. This card is like no other debit card you’ll ever own in your life! Connect the card to your bank account, create a pin, load money onto the card and you’re off to the races! With this card your round-ups will occur in real-time. All of your transactions will be recorded in the app. If your card ever gets lost or stolen there is a button you can slide over in order to deactivate your card through the app. It is made of tungsten metal so no worries of your card getting bent or damaged. Just holding the card in your hand makes you feel different than everyone else, like you’re part of an elite group. Which you are! You’re taking your financial future into your own hands by being part of the Acorns family. Pre-order your Acorns Debit now!

Traditional IRA

Another feature that Acorns offered last year was the opportunity to open up an Individual Retirement Account aka an IRA through the app. An IRA is just another way to save for your financial future. Round-ups aren’t contributed to this account, only reoccurring investments. Do your research on the advantages of opening an IRA and pick which IRA makes more sense for you to invest in.

Finally Membership

To open up a regular round-up/reoccurring investment account with Acorns, they will charge you a $1/month fee which is very reasonable. To open an IRA account they will charge you $2/month, again very reasonable. These monthly fees become almost negligible as you start to invest and grow your investments each month. You won’t even feel an impact from these amounts.

This is just a starting point to building your investment strategy. You should always try to expand your savings whenever possible. By daily/weekly budgeting you will find areas to tweak and add extra money to your savings. When choosing a weekly investment start small maybe $5 or $10 a week. After each tweak, you’ll be able to add more and really start to see your money grow and compound!

From small acorns, big oaks do grow!

-Acorns App

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