Acorns Review [2024]: Easy Investing to Grow Your Money

Anyone can “squirrel” away some money and become an investor with Acorns. All it takes is $5 to get started.
Updated April 11, 2024
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Acorn Review

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You might assume you need a huge wad of cash to start investing, but fintech (financial technology) companies have changed the investing landscape for the better. Now, you can invest a little at a time, putting your spare change into stocks, bonds, and other securities. With diversified portfolios, you can watch your money grow, whether you have $5 a month to put aside or $500.

Enter Acorns, an online investment platform that takes the guesswork out of investing. It’s just one of the fintech companies making a big splash by helping users more easily get into investing money through fractional shares (small portions of shares in a company). It’s a compelling way to save for the future, but it’s not for everyone. 

Read on to find out if investing with Acorns is the right move for you.

Quick Summary

Get started investing by easily using your spare change.

  • Earn bonus investments for shopping you already do
  • No surprise fees
  • Data protected by bank-level security and 256-bit encryption
In this Acorns review

How does Acorns work?

Acorns is a micro-investing platform and robo-advisor that launched in August of 2014. It’s a legitimate company backed by investors like PayPal, NBCUniversal, and Rakuten. With more than 4.5 million users, Acorns is a trusted tool for people with little-to-no experience investing. And when you sign up with Acorns, you’re helping the company plant oak trees across the country. Acorns helped plant 178,000 trees last year alone, which is a big win for the environment.

When you use Acorns, your money is put into a diversified investment that Nobel prize-winning economist Dr. Harry Markowitz, father of modern portfolio theory, helped build. You get to decide how conservative or aggressive you want to be by choosing one of five portfolio options. And Acorns’ features let you invest on autopilot, so you don’t have to think about how to distribute your hard-earned cash.

Specifically, the service known as Acorns Invest allows you to invest as little as $5 on a recurring basis or at any time. You can set it to add money to your investments on a daily, weekly, or monthly basis or you can add extra funds any time you feel like it. For example, you might choose to invest $50 monthly and then add an extra $200 when your tax return arrives. Funds are transferred from your personal bank account.

You can also invest your spare change automatically with Round-Ups. If you opt into Round-Ups, each purchase you make is rounded up to the nearest dollar. That round number is reported to your credit or debit account, while the difference is automatically transferred into your Acorns Invest account (once you’ve accumulated a $5 minimum balance). In other words, if you buy a candy bar for $1.25, $2.00 is taken out of your bank account and $0.75 of that is put toward your investment portfolio. To take advantage of Round-Ups, you will need to link a bank account or a credit or debit card.

Acorns automatically “rebalances” your portfolio and provides you with ongoing support for a low monthly fee. That means as the market fluctuates and the values of your securities change, Acorns will work to rebalance your portfolio to its designated level of risk. This rebalancing ensures the proper asset allocations within your account, so you’ll be more likely to see your money grow in the way you desire.

Acorns accounts

Acorns Investing gives you the ability to open a traditional IRA, Roth IRA, or SEP IRA. You can also choose to invest in sustainable ESG portfolios. For those saving for children, Acorns Early also gives you the ability to open a UTMA/UGMA account. Acorns Banking gives you access to a checking account that makes automatic investing very simple.

Acorns offers two primary memberships, with a number of features included:

  • Acorns Personal account: Includes an investment account with access to Round-ups, a retirement account with potential tax advantages, and a checking account with no overdraft fees. This checking account also comes with a metal debit card. Acorns charges $3 per month for this account.
  • Acorns Family account: Includes everything that the Acorns Personal account includes, plus the ability to have investment accounts for multiple kids. Acorns charges $5 per month for this account.

Who can earn with Acorns?

To sign up for Acorns, you must be at least 18 years old and a United States resident. There’s no minimum investment to open an account if you want to get started with Round-Ups by linking a credit or debit account right away. While there are no account minimums, your money won’t actually start investing until you’ve accumulated at least $5.

Acorns is a great option for people who are just getting started with investing and don’t have a lot of money to buy shares. To actually earn, though, you should invest enough (or spend enough that your Round-Ups add up) to offset the loss of the monthly membership cost. This isn’t a big commitment, since Acorns' pricing ranges from just $3 to $5 per month.

How much can you earn with Acorns?

The amount you can earn with Acorns varies along with the amount you invest. You can withdraw your money at any time without penalty, but you’ll earn more if you invest more and the longer you leave your money invested.

When you invest with Acorns, you are investing in exchange-traded funds, also known as ETFs across five asset classes: corporate bonds, government bonds, real estate, large company stocks, and small company stocks. Acorns’ ETFs are intended to replicate the S&P 500 index, which has seen an average annual return of 10% since its beginnings. However, that doesn’t necessarily mean you can expect to gain 10% in your first year of investing. You’re more likely to see impressive gains if you leave your money invested for many years.

Maximizing your earnings with Acorns

The best way to grow your money with Acorns is to invest as much as you can into your Acorns Invest account, and to start investing early in life.

However, you might be able to snag some bonus investments for the shopping you already do with popular brands. If you use any linked debit or credit card to shop at one of the Acorns Earn partners, you’ll get bonus money automatically invested into your Acorns Invest account. It works like cash back, only the money goes toward your investment portfolio. Acorns Earn partners include retailers like Walmart, Nike, and Macy’s and even travel merchants like Airbnb and Expedia.

In addition, you can earn even more rewards if you're using an Acorns Visa debit card.

You can also get a $5 bonus for referring your friends, as long as your friend signs up. Your friend will get a $5 welcome bonus as well, so you can both benefit from a little extra cash. Just use your referral link and make sure your friend signs up within one month of receiving it.

Acorns vs. Stash

Stash is a micro-investing app similar to Acorns that also lets you start by investing as little as $5. It has four million users and offers flexible investing accounts. The basic monthly membership provides access to a debit account and free financial education. Comparing Acorns vs. Stash side-by-side can help you determine which is a better fit for your investing habits.

With Stash, you can also earn Stock-Back when you shop with your debit card. For example, if you make an Amazon purchase, you’ll be rewarded with stock in Amazon. If the company isn’t partnered with Stash, you’ll still get a percentage back as an addition to your investing account. That means that every time you make a purchase, a percentage of that amount will be invested for you across your securities.

Unlike Acorns, with Stash you can choose to invest with companies you know in addition to ETFs. Stash is designed for someone who wants to have more input when they invest, and is also a great option for someone who doesn’t have a bank account or wants to avoid hidden fees associated with bank accounts. The service is most rewarding for people who shop with their Stash debit card, so when determining whether Stash is right for you, you should compare the earnings from a Stash debit card with those associated with your preferred rewards credit card.

Acorns, on the other hand, is better for an investor who doesn’t want to think too much about their investing. The Round-Ups feature makes it easy to invest extra money on autopilot, and Acorns chooses the ETFs that make up your portfolio.

Acorns vs. Robinhood

Unlike Acorns and Stash, there is no monthly fee for Robinhood’s basic account. There are also no fees for opening and maintaining your account or for inactivity. But there is a $75 charge if you transfer your money to another online broker. 

Robinhood offers real-time investing in a range of assets of your choosing, from stocks to cryptocurrencies. There are more than 5,000 stocks available on Robinhood Financial. And because you have access to fractional shares (small portions of shares of equity in a company), you can invest as little as $1 to get started. There’s also commission-free options trading, and you can buy and sell cryptocurrencies.

Robinhood has a more hands-on approach than many of the other best investment apps. It’s best for people who want to have a say in choosing their investment opportunities, while Acorns is best for people who want to grow their money without staying actively involved.

FAQs about Acorns

Is Acorns a good investment?

While Acorns is a low-cost option, as with any investment strategy, investing with Acorns comes with a level of risk. Market fluctuations mean your money might not grow at a steady and consistent rate, and you’ll see a greater return if you leave your money invested for many years.

You should also plan to invest enough that your average return will offset the minimum of $12 you’ll pay annually for maintaining your Acorns account. You can do so by making regular contributions or making enough purchases with Round-Ups.

Contributions to your Acorns account are insured by the SIPC, which insures your money up to $500,000 in case Acorns runs into financial trouble. Acorns Spend contributions are insured by the FDIC up to $250,000.

Can you pick your stock on Acorns?

No. You can choose one of five Acorns portfolios, which range from “conservative” to “aggressive” in their investment strategies, but the ETFs that make up those portfolios are chosen for you. You can’t opt out of individual stocks or bonds or choose any specific stocks or bonds to invest in.

Can I use my credit card with Acorns?

Yes. You can link your credit card to your Acorns account. This will allow Acorns to invest spare change from every purchase with Acorns Round-Ups and provide bonus investments when you shop with Acorns’ Found Money partners.

Do I have to pay taxes on Acorns?

If you don’t make any withdrawals from your account or sell any investments during a calendar year, it’s less likely you’ll need to pay taxes. However, if you receive more than $10 in dividends or more than $600 in referral bonuses and other bonus offers, you will need to pay taxes on those earnings.

You may also need to pay taxes on any gains if you withdraw a lump sum from your Acorns Invest account or sell your investments. If you keep your money invested for more than a year, it’s possible you won’t owe anything at all. It’s best to consult a tax professional or find out how your individual situation is treated on the IRS website.

Why does Acorns need my Social Security number?

Financial institutions are required to verify your identity under the Patriot Act when you open an account. Acorns also needs your Social Security number for tax purposes, so they can issue you the appropriate forms at the end of each year.

What is Acorns Grow?

Acorns partnered with CNBC to publish Acorns Grow, an online learning resource geared toward millennials. Its goal is to help new investors learn about personal finance, investing, and the stock market.

Does Acorns offer tax-loss harvesting?

Acorns is not one of the robo-advisors that offers tax-loss harvesting. If you are interested in this feature, then Wealthfront might be a better option for you. It also offers access to dividend reinvestment and cryptocurrency.

How to sign up for Acorns

To sign up for Acorns, you’ll start by creating an account with your email address and password. You’ll need to answer some questions about your goals and risk tolerance and provide the following information to complete the sign-up process:

  • Your online banking login information (or account and routing numbers) for account linking purposes
  • Your physical address
  • Your Social Security number
  • Your occupation, income, and financial goals, which will help Acorns recommend the right portfolio for your needs.

Once you're signed up, you can choose to download the Acorns app for your Android or Apple device via Google Play or the App Store to easily track your account balance. To start investing, you'll need $5. 

The bottom line on Acorns

Tossing spare change into a piggy bank is an excellent way to reach your financial goals — if you’re saving up for a Lego set. But learning how to invest money by putting it somewhere it may actually grow can build wealth for the future.

Acorns fees are very low, which is one of the reasons it is a great tool for new investors who want to start investing without a lot of money and without putting any energy into choosing stocks and bonds. It can be especially lucrative for people who make recurring investments and keep their money invested for many years. And if you frequently shop at Acorns’ Found Money partners, your money can grow even faster.

Acorns isn’t the best brokerage account for everyone, though. Some people might prefer to choose another investing app like Stash or Robinhood, while others may want to stay out of the stock market altogether. 

It’s also important to remember that an Acorns investment account isn’t a replacement for a savings account. You’ll still want to put aside money in a savings account, so you can depend on that stash of cash when a financial emergency comes up. Create a budget to determine what you should save and to make sure that Acorns’ Round-Ups won’t leave you without anything to put aside. 

If you like the way Acorns helps you automate investing, consider automating your savings with an app such as Digit. You can compare and contrast Digit vs. Acorns and see which better fits your financial goals. 

Author Details

Lindsay Frankel Lindsay Frankel is a Denver-based freelance writer who specializes in credit cards, travel, budgeting/saving, and shopping. She has been featured in several finance publications, including LendingTree. When she's not writing, you can find her enjoying the great outdoors, playing music, or cuddling with her rescue pup.