What digital investment app is making some noise right now? Acorns is, doing it by allowing you to sit back and save money. Oh how sweet retirement sounds now huh? So this company transfers miniscule sums from your checking, savings, to an investment account through automatic transfers. They aiming this product to the under 35 crowd because let’s face it, they have absolutely very little discipline in the saving department.
Since their launch in August of last year Acorns has about 250,000 active users. Acorn being considered one of the best designed investment app, they’ve managed to recently acquire $10.5 million in capital on top of a previously raised $9 million. In order to use Acorns a person links their debit or credit card to the app which automatically rounds every purchase to the nearest dollar. Then the money is invested in a portfolio of whatever you choose. It is very similar to Bank of America’s ‘Keep the Change’ program, except with Acorn you’re doing something with those funds. The company says it lets you “invest spare change automatically from everyday purchases into a diversified portfolio.”
If you’re like me and use credit cards for practically all of your purchases, rounding up those transactions can add up quickly. So if you buy a sandwich at the deli for $6.25, 75 cents gets automatically moved to your Acorns account. Jeff Cruttenden, Co-founder, says the average user saves $55 a month from roundups. The user has the option of setting a recurring deposit or transferring funds manually. The change gets invested in ETF’s or exchange-traded funds. “We wanted to create something that’s really easy to start investing,” says Cruttenden
The app has very comprehensive, yet easy to use graphs that can show how much money you can make. So an example is if you were to deposit $55 a month into an aggressive portfolio you could end up with $10,438 after a 10 year period. Acorns charges $1 a month for accounts under $5,000. For accounts over that amount, it charges 0.25 percent a year, which comes to about $2.08 a month for a balance of $10,000. Plus there are no fees for withdrawing money, and no minimums. Accounts are insured by the Securities Investor Protection Corp.
So with knowing Acorns just picked that new $10 million and change in funding, they have got to be hiring some people. Get your resumes sharpened and start sending them to these folks, seems like this isn’t a fluky thing. They are bound to get bigger and bigger.