Imagine a world where your spare change could grow into a flourishing investment portfolio.

Well, that world exists, thanks to the game-changing Acorns investing app!

Get ready to unlock the potential of your spare change and grow your wealth effortlessly with Acorns. It’s time to put your money to work for you and enjoy the rewards of financial empowerment. This app has the power to effortlessly turn your everyday purchases into opportunities for wealth accumulation.

In this post, I’ll be taking you on a journey to discover why Acorns is the ultimate game-changer when it comes to investing.

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What is Acorns?

Acorns is a micro-investing and robo-advising app that allows users to invest spare change from everyday purchases into diversified ETF portfolios.

The app rounds up purchases made with linked cards to the nearest dollar, and invests the spare change.

The spare change that gets invested is put into one of five index fund portfolios, constructed and maintained by Acorns. Portfolios range from conservative to aggressive based on the percentage allocation to stocks and bonds. You can select which portfolio suits their investment goals and risk tolerance.

Acorns aims to make investing and saving effortless by doing the work behind the scenes. The app handles calculating and investing spare change, constructing diversified portfolios, and automatically rebalancing investments over time. This makes Acorns well suited for hands-off, long-term investments of small amounts.

How does acorns Work?

Acorns works by linking to the user’s bank account or credit/debit cards and rounding up purchases to the nearest dollar, investing the difference into the user’s investment account. For example, if you spend $4.50 on coffee, Acorns will invest the $0.50.

In addition to the round-up contributions, users can also set up recurring investments on a weekly, biweekly, monthly, etc basis. All of these contributions are invested into ETF portfolios selected by you.

Acorns charges a monthly fee ranging from $1- $5 depending on the account type, to cover the costs of maintaining the platform and managing the investments.

Types of Acorns Account Types

Acorns offers four main account types:

  • Acorns Core: Individual Investment Account: This is a standard taxable investment account that allows you to invest your spare change. It offers access to Acorns’ portfolios of ETFs.
  • Acorns Later: This IRA account allows you to save for retirement through automatic contributions or one-time deposits. It provides the tax advantages of an IRA.
  • Acorns Spend Checking Account: This FDIC insured checking account invests your spare change and has no minimum balance requirement. It offers a debit card and access to over 55,000 fee-free ATMs.
  • Acorns Family Investment Account for Kids: This custodial account allows families to invest for their children’s future. Parents maintain control until the child reaches the age of majority.

Portfolio Options

Acorns offers 5 portfolio options to match your investment style and risk tolerance:
  • Conservative: This portfolio invests in 80% bonds and 20% stocks. It’s designed for investors with the lowest risk tolerance who want to preserve capital. The conservative portfolio has the lowest potential returns but also lowest volatility.
  • Moderately Conservative: This portfolio contains 60% bonds and 40% stocks. It’s suited for investors who want modest growth with minimal risk and volatility. The moderately conservative portfolio aims for stable returns with some capital appreciation over time.
  • Moderate: This portfolio invests in 40% bonds and 60% stocks. It balances growth and preservation for investors who can stomach some volatility. The moderate portfolio targets moderate returns with medium risk exposure.
  • Moderately Aggressive: This portfolio holds 20% bonds and 80% stocks. It prioritizes growth over stability for investors with a higher risk tolerance. The moderately aggressive portfolio seeks strong returns but with greater volatility.
  • Aggressive: This is an all-stock portfolio for investors who want maximum growth and can handle major volatility. The aggressive portfolio aims for the highest potential returns but with the most risk.
Acorns Portfolio Options

What are the fees for using Acorns?

Acorns charges monthly fees ranging from $1 to $5 depending on the account type. The Acorns Personal account costs $1 per month, the Acorns Family account is $2 per month, and the Acorns Retirement account has a $3 monthly fee.

These fees cover the automated investing service and access to the app. Check their current fees here.

In addition to the monthly fee, there are underlying ETF expense ratios which range from 0.03% to 0.15%. These fees are charged by the ETF providers, not Acorns, and go towards covering the costs of operating the ETFs.

The total fees on Acorns are quite low compared to traditional investment advisors or mutual funds. However, they can still add up, especially for small account balances.


Historical returns for Acorns accounts depend on the portfolio selected and time period measured. According to user reports on Reddit, aggressive portfolios in Acorns realized around 19% returns in 2020.

However, long-term returns are more modest. Acorns states that the average annual return from 1926 to 2018 for the S&P 500 index was approximately 10-11%.

This suggests Acorns investors can expect market-comparable returns over longer time horizons, even if shorter periods see above-average gains. Ultimately, Acorns aims to produce competitive investment results for set-and-forget, passive investors across full market cycles.

The content provided in this blog post is for informational purposes only and should not be construed as financial advice. I am not a financial advisor. All investments carry risks, and past performance is not indicative of future results. Before making any financial decisions, consult with a qualified professional.

Who Should Use Acorns?

Acorns is a great app for beginner investors or those new to investing. The “round up” feature allows you to invest your spare change from everyday purchases into a diversified investment portfolio. This makes it easy for novice investors to begin investing small amounts without much effort.

Acorns is also ideal for hands-off investors who want an automated way to invest. Once you connect your bank account and credit cards, the app will automatically invest your spare change in accordance with your selected portfolio. This takes the work out of manually moving money and rebalancing.

Overall, Acorns is a simple, user-friendly way for new investors to begin investing small amounts and grow their money overtime through automated, passive investing. The app makes investing accessible for those without much investing know-how or large amounts to invest.

Pros of Acorns

Acorns offers several advantages that make it a compelling investing app, especially for beginners or those with limited capital.

Some of the key pros include:

  • Easy way to invest small amounts: Acorns allows you to start investing with just $5 or $10. This makes investing accessible even if you don’t have thousands of dollars saved up already. Small, automatic transfers add up over time through the power of compounding.
  • Automated investing/rebalancing: Once an Acorns account is set up, your portfolio is automatically invested and rebalanced. This takes the work out of manually managing your investments
  • Low fees: Acorns charges $1-$5 per month depending on the account type. The fee is low compared to traditional investment advisors or brokerages that often charge a percentage of assets. This helps maximize returns.
  • Educational resources: The Acorns app includes investing explainers, financial literacy tips, and guidance to help users make informed decisions. This can provide a solid foundation for investing knowledge.

By simplifying investing and automating the process, Acorns makes it easy for anyone to start building their wealth through the stock market. The hands-off approach and minimal fees maximize returns on even small investment amounts. Overall, Acorns reduces common barriers to investing for beginners.

Cons of Acorns

Acorns charges monthly fees depending on the account type you choose. The fees start at $1/month for Acorns Lite and go up to $5/month for Acorns Family. While these fees seem low, they can still eat into your returns, especially if you have a small investment balance.

Another downside is that Acorns offers limited customization of your investment portfolio. You can choose between 5 premade portfolios, but you can’t select individual stocks or customize your asset allocation beyond those options. This makes Acorns a set-it-and-forget it app, which may not be ideal for hands-on investors who want more control.

Finally, to use Acorns, you have to link a bank account so the app can automatically invest your spare change. Some users may not feel comfortable linking their bank account or giving an app access to withdraw money.

Why we like Acorns

Overall, Acorns is a great app for beginning investors or those looking to invest spare change in an automated, hands-off way.

By rounding up purchases and automatically investing the “spare change,” Acorns makes it easy to nail the habit of investing consistently.

The portfolios are diversified and offered at a very low cost, making Acorns ideal for long-term, passive investors who don’t need advanced investment features.

For those new to investing or just looking to passively invest small amounts, Acorns provides an automated way to build an investment portfolio over time. While the returns may not be as high as more active investing strategies, Acorns offers a hands-off approach well-suited to beginner investors who want an easy way to invest spare change and build savings over the long run.

Disclosure: This post may contain affiliate links, meaning we receive a commission for purchases made through these links, at no cost to you.

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