Acorns

What is Acorns?

Acorns is an innovative micro-investing and financial wellness platform designed to make investing accessible to everyone, regardless of income level or investment experience. Founded in 2012 by Walter and Jeff Cruttenden in Irvine, California, Acorns pioneered the concept of “round-up” investing, automatically investing spare change from everyday purchases into diversified portfolios.

The platform has revolutionized how millions of Americans approach saving and investing by removing traditional barriers like high minimum investments, complex interfaces, and intimidating financial jargon. Acorns manages over $4.7 billion in assets for more than 10 million users, making it one of the most successful fintech companies focused on democratizing wealth building for younger generations and first-time investors.

Acorns offers a comprehensive suite of financial services including automated investing, retirement accounts, checking accounts with debit cards, and educational content. The company’s mission is to look after the financial best interests of the up-and-coming, helping everyday Americans build wealth through consistent, automated micro-investments that add up over time without requiring active management or significant upfront capital.

Key Features

• Round-Up Investing: Automatically rounds up every purchase to the nearest dollar and invests the spare change into a diversified portfolio of ETFs.
• Smart Portfolios: Choose from five expertly constructed portfolios ranging from conservative to aggressive, built with low-cost ETFs across asset classes.
• Recurring Investments: Set up automatic daily, weekly, or monthly investments of any amount starting from just $5 to build wealth consistently.
• Found Money: Earn bonus investments from hundreds of partner brands when you shop through the Acorns app at retailers like Nike, Walmart, and Chevron.
• Acorns Later: Open and contribute to IRA retirement accounts (Traditional, Roth, or SEP) with automatic contribution management.
• Acorns Spend: Full-featured checking account with a metal debit card, no minimum balance, and direct deposit with early access.
• Acorns Early: Investment accounts for children (UGMA/UTMA custodial accounts) to start building wealth from birth.
• Earn Rewards: Shop at over 350 partnered brands to earn automatic investment rewards deposited directly into your account.
• ESG Portfolios: Socially responsible investment options for those who want their investments aligned with environmental and social values.
• Educational Content: Access financial literacy articles, videos, and tools to improve your money knowledge and make informed decisions.

Latest Updates

Acorns continuously enhances its platform to provide more value and better investment experiences for its members.

• Acorns Premium Tier: Introduced a premium subscription tier with enhanced features including access to alternative investments and custom portfolios.
• Emergency Fund Feature: Added dedicated emergency savings functionality separate from investment accounts with quick withdrawal access.
• Enhanced Round-Ups: Introduced 2x, 3x, and 10x round-up multipliers for those who want to invest more aggressively on purchases.
• Improved Portfolio Options: Added Bitcoin-exposed portfolios for members interested in cryptocurrency exposure within diversified portfolios.
• GoHenry Integration: Following acquisition, integrated youth financial education features for families teaching children about money.
• Direct Deposit Bonus: Launched bonus programs for setting up direct deposit with the Acorns Spend checking account.
• Expanded Earn Partners: Significantly increased the number of Found Money partner brands offering investment rewards.
• Financial Wellness Tools: Added budgeting insights, spending analysis, and personalized financial recommendations to the app.

System Requirements

iOS

• Operating System: iOS 14.0 or later
• Compatible with iPhone and iPad
• Storage: 175 MB available space
• Camera for check deposits
• Internet connection required

Android

• Operating System: Android 7.0 or later
• Storage: 100 MB available space
• RAM: 2 GB minimum
• Internet connection required

Web Browser

• Google Chrome (latest version)
• Safari 12 or later
• Mozilla Firefox (latest version)
• Microsoft Edge (Chromium-based)
• JavaScript enabled

How to Install Acorns

iOS Installation

1. Open the App Store on your iPhone or iPad
2. Search for “Acorns: Invest Spare Change”
3. Tap “Get” to download the free app
4. Open the app and tap “Get Started”
5. Create your account with email and password
6. Complete your investor profile questionnaire
7. Link a funding source (bank account or debit card)
8. Choose your investment portfolio based on risk tolerance
9. Select your subscription tier and begin investing

Android Installation

1. Open Google Play Store on your device
2. Search for “Acorns: Invest Spare Change”
3. Tap “Install” to download
4. Open app and create your account
5. Answer investor profile questions
6. Connect your bank account for round-ups
7. Select your portfolio type
8. Choose subscription plan and start investing

Web Setup

1. Visit acorns.com in your web browser
2. Click “Get Started” to begin registration
3. Enter your email and create a password
4. Complete identity verification
5. Answer investor profile questionnaire
6. Link your bank account using Plaid
7. Select portfolio and subscription tier
8. Download mobile app for full functionality

Pros and Cons

Pros

• Effortless Investing: Round-ups automate investing without requiring active decisions, making it easy to build wealth from everyday spending.
• Low Barrier to Entry: No minimum investment required means anyone can start investing with just spare change from purchases.
• Diversified Portfolios: Professionally constructed portfolios use low-cost ETFs spanning stocks, bonds, and real estate for proper diversification.
• All-in-One Platform: Combines investing, retirement accounts, checking, and family accounts in a single integrated platform.
• Found Money Rewards: Earn free investments by shopping at partner brands, effectively getting paid to shop at places you already use.
• Educational Focus: Strong emphasis on financial literacy helps users understand investing concepts and make better decisions.
• Family Features: Acorns Early allows parents to start investing for children from birth, building long-term wealth through compound growth.

Cons

• Monthly Fees on Small Balances: The $3-5 monthly subscription can represent a high percentage cost for those with very small account balances.
• Limited Investment Options: Cannot pick individual stocks or customize portfolios beyond the preset options provided by Acorns.
• No Tax-Loss Harvesting: Lacks automated tax-loss harvesting features offered by some competing robo-advisors.
• Small Round-Up Amounts: Round-ups alone typically generate modest investments, requiring additional recurring deposits for meaningful growth.
• Withdrawal Processing: Transferring money out of investment accounts can take several business days to complete.

Acorns vs Alternatives

Who Should Use Acorns?

Acorns is ideal for:

• Beginner Investors: People new to investing who want a simple, automated way to start building wealth without complex decisions.
• Hands-Off Savers: Users who want to invest consistently without actively managing their portfolio or making regular investment decisions.
• Young Professionals: Millennials and Gen Z users who prefer mobile-first financial tools and want to start investing with small amounts.
• Parents Building for Kids: Families wanting to start investment accounts for children to benefit from decades of compound growth.
• Busy Professionals: People who want to invest but don’t have time to research stocks or manage portfolios actively.
• Financial Learners: Users who want to learn about investing while actually participating with real money in a low-risk way.

Acorns may not be ideal for:

• Active Traders: Investors who want to buy and sell individual stocks, options, or cryptocurrency need a traditional brokerage.
• Very Small Balances: Users with very little to invest may find the monthly fee represents too high a percentage of their balance.
• Advanced Investors: Experienced investors wanting tax-loss harvesting, individual stock selection, or complex portfolio strategies.
• Cost-Sensitive Large Balances: Those with large investment balances may find percentage-based fee robo-advisors more economical.

Frequently Asked Questions

How does Acorns round-up investing work?

When you link a debit or credit card to Acorns and make purchases, the app rounds up each transaction to the nearest dollar. For example, if you spend $3.50 on coffee, Acorns rounds it up to $4.00 and invests the $0.50 difference. Round-ups accumulate until they reach $5, then are automatically transferred from your linked account and invested in your chosen portfolio.

Is my money safe with Acorns?

Yes, Acorns provides multiple layers of protection. Investment accounts are protected by SIPC (Securities Investor Protection Corporation) up to $500,000. Acorns Spend checking accounts are FDIC insured up to $250,000 through Lincoln Savings Bank. The app uses 256-bit encryption and offers two-factor authentication for additional security.

How much does Acorns cost?

Acorns offers tiered subscription plans. Acorns Bronze costs $3/month and includes basic investing. Acorns Silver costs $5/month and adds retirement accounts (Acorns Later). Acorns Gold costs $9/month and includes all features plus Acorns Early custodial accounts for kids, GoHenry debit cards for children, and premium rewards. All plans include the Acorns Spend checking account.

Can I withdraw my money anytime?

Yes, you can withdraw from your Acorns Invest account at any time. There are no early withdrawal penalties for taxable investment accounts. Withdrawals typically take 3-6 business days to transfer to your linked bank account. Note that retirement account withdrawals (Acorns Later) may be subject to taxes and penalties if taken before age 59½.

What are Acorns portfolios invested in?

Acorns portfolios are composed of exchange-traded funds (ETFs) spanning multiple asset classes. Depending on your risk tolerance, your portfolio may include ETFs tracking large company stocks, small company stocks, international stocks, emerging markets, government bonds, corporate bonds, and real estate. Each portfolio is automatically rebalanced to maintain target allocations.

Final Verdict

Acorns has successfully democratized investing by making it accessible, automatic, and understandable for millions of Americans who might otherwise never start building wealth. The round-up feature is genuinely innovative, turning everyday spending into investment opportunities without requiring conscious effort or significant capital. For beginners and hands-off investors, this approach can establish crucial investing habits.

The platform shines in its simplicity and comprehensive offering. Having investing, retirement accounts, checking, and family accounts in one app creates a convenient ecosystem for managing finances. The Found Money rewards program adds genuine value, and the educational content helps users grow their financial knowledge alongside their portfolios.

The main consideration is cost-effectiveness at different balance levels. For those just starting with small amounts, the monthly fee represents a higher percentage than traditional percentage-based robo-advisors. However, as balances grow, the flat fee becomes increasingly economical. For anyone looking for a simple, automated way to start investing and build long-term wealth, Acorns delivers an excellent entry point into the world of investing and earns a strong recommendation, particularly for beginners and hands-off investors.