Robinhood vs Acorns Reviews 2021: Pros & Cons | Legit & Scam | How it Works

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Investors are the real wealth creators. They fully understand the essence of identifying opportunities to make money.

Our Robinhood vs Acorns review will give you all the advantaged-information you require to make informed investment-choices with the trading apps.

According to a 2019 survey by GoBankingRates,  64% of Americans will retire with $10,000 or less. Meanwhile, a 2019 report by the Federal Reserve indicates that Americans with self-directed retirement savings (nearly 7 in 10 non-retired adults) have to make decisions about how the money is invested.

However, Six in 10 non-retirees with these accounts express low levels of comfort in making investment decisions.

Investing could be a really tough decision, majorly because if appears a huge risk often. Nonetheless, it’s a risk that must be taken if wealth will be attained.

If you desire to begin automatically investing on a small scale, then a great choice to try is a cool micro-investment app like Acorns. On the other hand, Robinhood should be the right choice if you want to get your hand on real investments such as stock trading, ETFs and cryptocurrencies.

In this read, you are assured of an in-depth review of Robinhood vs. Acorn and the pros, cons, and legitimacy of both apps. This will further enable you to make informed investment decisions.

One of the very first moves in investing in the stock market is selecting a brokerage to invest in. There were not many choices in the past and the programs were all very equivalent. There are hundreds of options available today, all with very distinctive deals. When investigating various investing applications, it is easy to become overwhelmed. 

Robinhood vs Acorns: What is Robinhood?

Robinhood is a commission-free stock trading app that enables you to exchange stocks, ETFs, options, and crypto. It is open to beginners and pro alike who want to invest in the simplest way possible. The brokerage is willfully basic with a fantastic user interface.

Furthermore, the trading app has a very simple design that makes its trading process very easy-to-understand. Robinhood is 100% commission-free.

Is Robinhood Legit?

Securities trading is offered to self-directed customers by Robinhood Financial. Robinhood Financial is a member of the Financial Industry Regulatory Authority (FINRA).

Robinhood is only licensed to trade securities in the United States (US), to US citizens and residents, and will not authorize anyone who is not a legal US resident to purchase or sell securities through its application until such time as it is approved to engage in the securities and investment business by the appropriate regulator(s) of a foreign jurisdiction.

The trading platform is currently available to legal US residents over 18 years of age only.

The user-friendly web and mobile app are best for newcomers to investing who want to trade small quantities, including fractional shares, and demand little in terms of research beyond seeing what others are trading.

To sum it up, Robinhood seeks to empower this new generation to take greater ownership in their financial future, which will definitely lead to a healthier, more robust global economy. Click here to get register.

How Can I Own A Robinhood Account?

You can own a Robinhood account through your smartphone, tablet, or computer device. Kindly follow the steps below;

  • To start your account, Click here and fill in your contact info and other necessary background details.
  • You’ll receive a notification email with a link which you’ll use to launch stellar investments.
  • To set up the account, you don’t need to pay any commission or fees.

However, to invest you need to deposit any amount into the account to set the ball rolling. Any amount is good for a head start.

Robinhood uses instant verification with many top banks. Bank transfers of up to $1,000 are available immediately for investing, and the same goes for profits of up to $1,000 from selling stocks. Deposits larger than $1,000 will take around five business days to process.

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How Can I Invest in Robinhood?

Robinhood offers commission-free stock, ETF, and cryptocurrency trades. Nevertheless, this investment app stands out most for offering a streamlined trading platform and free cryptocurrency trading.

Robinhood doesn’t have an account minimum! Which means investors can get started with $0. However, in order to invest, you’ll need to have sufficient investment power to purchase the investment you have your eye on.

Why Should I Choose Robinhood?

Robinhood’s most known feature is commission-free trading. That extends to trading stocks, cryptocurrencies, and ETFs. Best of all, there are no hidden fees.

Robinhood’s commitment to presenting 100% commission-free stock, securities, ETF, and cryptocurrency trades is commendable, and the savings for investors who trade frequently is significant.

Every money you save on commissions and fees is a dollar added to your returns. Still, these days many big-name brokers also offer free trades, so it will be nice to compare other features while picking a broker.

How Much Do I Need To Invest in Robinhood?

Robinhood offers commission-free stock, ETF, cryptocurrency, and options trades. More so, Robinhood offers $0 stock trades by cutting out physical offices and manual account management. However, you need to fund your account to begin trading. Any amount is a good start investing in Robinhood.

If you’re keen on stock trading, managing your own securities, and want more investment options, the Robinhood investment app will offer you a better and more fruitful experience.

Robinhood Gold account demands $2,000 for a margin account (regulatory minimum).

What Are The Pros and Cons Of Robinhood?

Robinhood offers commission-free stock, ETF, and cryptocurrency trades. Nevertheless, this investment app stands out most for offering a streamlined trading platform and free cryptocurrency trading.

The app and website are user-friendly and very easy to use and charging zero commissions attract extremely cost-conscious investors who trade small quantities.

That said, the offerings are very light on research and analysis, and there are pressing questions about the quality of the trade executions and areas of strength.

Here’s a list of the pros and cons.

Pros of Robinhood

  • Zero-Commission trades on stocks, ETFs, crypto, and options.
  • A Cash Management account allows passive money to gain meaningful interest.
  • On Robinhood, it is easy to obtain tax documents and important information regarding the account.
  • It is very easy to set up a brokerage account.
  • Robinhood offers access to cryptocurrency including Bitcoin and Ethereum.
  • User-friendliness.
  • Instant access to $1,000 upon deposit.
  • Fractional shares are open for many users.
  • Bonus reinvestment allows you to earn compound interest.

Cons of Robinhood

  • Customer support is only obtainable in market hours.
  • Margin trading is only disclosed to Gold members.
  • Educational materials that will guide investors are not restricted.
  • On Robinhood, there are Llimited access to research reports without a Gold membership.
  • Robinhood doesn’t provide a technical trading platform to perform analysis.

Robinhood vs Acorns: What Is Acorns?

Acorns is an investing app that automatically invests your spare change. Each charge to your bank account is rounded up to the next dollar (Acorns calls these “round-ups”) and put in a diversified portfolio. If you buy breakfast for $6.25, Acorns rounds it up to $7 and invests the difference (75 cents).

By rounding up your change and keeping the difference, Acorns makes investing as easy as it can be; however, they do charge a fee.

Typically, it costs from $1 to $5 a month to invest with them. Instead of buying individual stocks, your money is reinvested in 1 of 5 prebuilt portfolios.

Acorns lookout for the financial best interests of the up and coming generations of investors, harnessing the strength and empowering step of micro-investing.

Now the next question is; how do I get started on Acorns?

How To Get Started With Acorns

To register on Acorns, you need to click here to set up your account then follow the steps below.

  • To start your account, choose a password and provide your:
    • Email address
    • Online banking login
    • Physical address
    • Social Security Number
    • Estimated net worth
  • Link any credit or debit cards you want to earn “round-ups” with. (As many or as few as you want).
  • Input your age, investment goals, timeline, and risk tolerance to determine your ideal portfolio.
  • Based on your info and the Modern Portfolio Theory, Acorns suggests a perfect portfolio for you.
  • To get your account running, you can then add an initial investment as little as $5+.
  • Finally, customize your account by adjusting your round-ups and setting up recurring deposits to grow your investments more quickly.

What Are The Pros and Cons Of Using Acorns?

The easy to invest trading app offers users options to automatically trade daily, weekly, and monthly. This one feature makes it highly flexible. Additionally, the platform has options for every demand which comes with little change to spare.

Contrarily, Acorns leaves users with little investment options. You’ll only have approximately 7 asset classes to choose from. Some investing services spread asset allocation over 10+ classes.

Just like every other thing holds an advantage and disadvantage, Acorns has areas that make it flaccid and areas that give it an edge over other investment platforms.

SEE ALSO: Acorns investing app: How to cash out Easily in 2020

Acorns Pros

  • Acorns is highly automatic.
  • On Acorns, you can invest spare change with ease.
  • The platform has lots of educational resources to look through to help clients learn.
  • There is room for automatic daily, weekly, or monthly funding schedule.
  • You can earn bonus investments by spending at certain stores and businesses through Found Money.
  • During setting up an account, you will have to select a portfolio that works for you and satisfies your risk tolerance.
  • You can easily accelerate investing with a one time deposit, recurring deposit, or a round-up multiplier.
  • You will have access to tax-advantaged retirement accounts for investing.
  • Create custodial accounts to start saving for future generations.
  • Support the planet by planting a tree when you sign up for the platform.

Acorns Cons

  • The $1 fixed fee for lite and $3 fixed fee monthly for personal may sound low but significantly cut into investment returns for small accounts.
  • You won’t have access to specific stocks or investments.
  • Most users feel the high automation feature has its own negative ends.
  • Lack of access to fundamental investment research.

Is Acorns Legit?

Acorns is an SEC Registered Investment platform.  Brokerage services are rendered to clients of Acorns Advisers by Acorns Securities, LLC, an SEC-registered broker-dealer, and member FINRA.  Member of SIPC. Securities in your account protected up to $500,000. Still in doubt?

Acorns now offer two new services, one for saving for retirement called Acorns Later, and another called Acorns Spend, which is a debit card that is combined with their other services.

The firm’s mission is to look after the financial best interests of the up-and-coming, beginning with the empowering step of micro-investing.

That small change of yours might mean a whole lot.

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Robinhood vs Acorns Reviews 2021

Acorns vs Robinhood are both investment and trading platforms that deliver unique features capable of tweaking your personal finances. They are avenues for investment, however, their differences.

You would like a microinvesting app like Acrons if you want to start investing automatically. This app offers a round-up spare change feature that invests cash for you.

Even, on Acorns, because the management fee is just $1 a month, you will not feel the effect of the cost implications. 

You would not find opportunities to invest in individual stocks, mutual and index funds, or bonds with Acorns for anyone who would like to assert leverage over their finances, so if that’s you, Acorns might be a no-no. 

On the other hand, the Robinhood investing app will provide you with a stronger and more fruitful experience if you’re keen on stock trading, managing your own shares, and want more investment options. 

On Robinhood, bonds, ETFs, and cryptocurrencies can be exchanged. In addition, by leaving out physical offices and manual account administration, Robinhood provides $0 stock transactions.

Finally, Acorns is suitable for beginners and investors who want to make a more active choice of their investments, whereas Robinhood is best for people who want a more active investment.

Even though Robinhood trading provides more personalization, it is entirely free of commissions. Both Robinhood vs Acorns are a investing apps that can be tried.

What are the Differences Between Robinhood vs Acorns.

Though Robinhood vs Acorns are investment trading apps, the have very notable differences.

The minimum fee for Acorns vs Robinhood trading apps is $0. You can purchase stocks, ETFs and cryptocurrency on Robinhood. Acorns, on the other hand, offers you the option between five portfolios based on your financial and tolerance levels of risk. Dozens of financial experts develop and track these portfolios.

If you just want to bring invests into your daily life automatically with most of them done for you, a pleasant micro-investment app like Acorns is a great way to try. You will feel less of a pinch and will develop your portfolio gradually thanks to his money change round-up feature which invests money for you.

You will not have to think about high management fees, either, because Acorns just charges $1 a month. And there is no way to invest in individual securities, mutual and index funds, or bonds with Acorns for someone who needs more leverage over their assets – so that if that’s you, it might not be your best investment app.

On the contrary, you will probably find the Robinhood investing app that offers you a stronger, more fruitful experience if you are curious about stock trading and managing your own investments and want more investment choices.

You can select from numerous financial instruments, including FDIC insured, like cryptocurrencies.

It’s all about whether or not you want to be responsible. Robinhood lets you do just that if you want to create a portfolio and pay zero fees from scratch.

If you want to keep a hand for a low price or are not doing well to save money, Acorns suits perfectly.

The table below explains the benefits and features of Robinhood vs Acorns.

 AcornsRobinhood
SPECIAL OFFER
$10 Sign-Up Bonus
– Learn more here
OFFER
Get a Free Stock (worth between $2.50 and $200) – Learn more here
 Benefits and Features
Stock TradingPart of service fee. No add-on trading fees.$0
Annual Fee$1/mo for Acorns; $2/mo for Acorns + Acorns Later; $3/mo for Acorns + Acorns Later + Acorns SpendAll trades are commission-free. No platform fees.
Minimum Deposit$0$0
Phone SupportYesNo
Banking$3/mo for Acorns + Acorns Later + Acorns Spend checking. Free debit card, no minimum balance, no overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide.Coming soon
Mobile AppYesYes
Fractional SharesYesYes
Taxable AccountsYesYes
IRA AccountsYesNo
$10 Sign-Up Bonus $5 Sign-Up BonusTry Acorns Today!Get a Free Stock (worth between $2.50 and $200) Commission-Free TradesFree Cryptocurrency Investing
Acorns vs. Robinhood Reviews

Acorns: Pricing information from published website as of 07/11/2019.
Robinhood: Pricing information from published websites as of 04/18/2021.

How Robinhood vs Acorns Work

Like Ryan Scribner sums up, this is simply how Robinhood vs Acorns works:

  • Both services offer low-cost ways for individuals to invest their money.
  • Robinhood is 100% commission free with no monthly subscription cost (except for Gold).
  • Acorns charges anywhere from $1 to $3 per month.
  • Robinhood is made for the individual looking to choose their investments.
  • Acorns is made for the hands-off investor that wants to stay diversified in all industries and profit off of overall market performance.
  • With Acorns, you can only invest in 1 of 5 portfolios. No individual stocks.
  • Acorns offers their services for a fee, but clients should expect this due to the service of automation such as automatic reinvestment of round-ups.
  • Robinhood Gold offers research and margin, but costs $5 per month.
  • Both offer easy to use application-based services that are beginner-friendly.
  • Overall, it comes down to personal preference as to which brokerage service will fit for you.
  • Robinhood is geared towards beginner investors who want to pick and choose their investments.
  • Acorns is for those who are bad at saving money and investing, who do not want to choose investments on their own.
  • If you use our link below, you will get a free stock from Robinhood!

Robinhood vs Acorns reviews 2021 are illustrated in the table below:

FeatureRobinhoodAcorns
Minimum Balance$0$5
FeesNone$1/Mo To $5/Mo Subscription
Trading CommissionsNoneNone
AssetsStocks, ETFs, Options, CryptocurrencieETFs (5 Portfolios Only)
Individual Stock InvestingYesNo
Retirement AccountsNoYes
Fractional SharesYesYes
Round Up InvestingNoYes
Best ForBeginners, Fee Sensitive InvestorsForgetful Investors, Bad Savers
Acorns vs Robinhood reviews

See Also: Robinhood vs Acorns: Legit or Scam | Pros & Cons | 2020

Final Thoughts

I am deeply assured that this article has set you on a more defined path to make better financial investing decisions especially with Robinhood vs Acorns trading apps.

Cheers to wealth creation!

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