In today’s world, millennials who are interested in investing have a plethora of options to choose from. From novice investors to experienced ones, there’s an application for everyone out there. In this article, we will take a look at two of the most popular investing applications – Stash Invest and Acorns.
Similarities between Stash and Acorns
On the surface, both the apps have been designed to make investing simpler for any investor out there. Furthermore, the users of Stash and Acorns primarily invest in exchange-traded funds (ETFs). Even the pricing is similar – $1 per month for accounts under $5,000 and for accounts over the same, a yearly fee of 0.25% will be levied. In addition to this, neither of them charge a trading fee.
So, how do Stash and Acorns differ?
The two investing applications differ in their core philosophy. Acorns was founded on the idea of micro-investing and letting your spare change grow into wealth over time. On the other hand, Stash Invest was designed to give people a feel of ETFs and enable them to invest in these funds confidently.
Any person who is not familiar with the world of investing can open an account with Acorns and witness the magic of compounding as time goes by. Every time you make a financial transaction, Acorns will round that value to the nearest dollar and invest that change in ETFs portfolios of your choosing. These portfolios comprise six asset classes like real estate, government bonds, corporate bonds, et cetera, and differ in risk factor, ranging from conservative to aggressive.
Needless to mention, you will be required to link the cards you use regularly with Acorns. You can also choose to invest a lump sum, depending on your financial condition.
When it comes to Stash, the idea is to invest in ETFs directly. Stash Invest offers more than 30 exchange-traded funds to choose from, each having a different asset class. Moreover, the names of these funds have been simplified to avoid the financial jargon. For example, if you are looking to invest in healthcare ETFs, then you can consider investing in ‘Live Long & Prosper’ or ‘Modern Meds’. You can further check the companies comprising these funds. Similarly, there exists ETFs for other sectors like banking, public works, real estate, et cetera.
From the above differences, it is evident that Acorns is for those users who are looking to invest and grow wealth effortlessly without having to learn a lot about finance. Meanwhile, Stash is suited for those who are willing to learn and create their own investing strategies for ETFs.