Is Acorns Legit? Is Acorns Worth it?

Is Acorns Legit? Is Acorns Worth it?

This Acorns review will explain how Acorns works and what the risks and savings are. It will also help you decide if Acorns is the right investment tool for your needs.

Do you remember your childhood piggy bank? You remember how you would dump all your quarters, nickels, and dimes in it until it was full.

You may have been like me and brought more money than you realized every time you changed your bank account.

Acorns hopes to take this “out-of-sight, out of mind” savings strategy to the next level. Acorns will round up your expenses to the nearest dollar and then invest your nickels for future goals.

The company recently added retirement accounts, a debit card account and a $10 sign up bonus.

Can micro-investing really help you grow your wealth? Let’s take an in-depth look.

RobinHoodAcornsM1 Finance
$0 per trade Read review$1-3 per month Read review$0 per trade
This guide is for DIY investorsBeginner-friendlyCommission-free trading
Easy-to-use mobile appFully automatedAutomated rebalancing
There is no minimum accountThere is no minimum account$100 account minimum
Learn more Receive 1 stock for freeLearn more Sign up for $10 BonusLearn More Sign up for nothing

What are Acorns?

The app is part spare change jar and part robo-advisor. This app will round up all your transactions on linked debit or credit cards, and then invest that money for you.

Acorns offers three levels:

Invest: $1/month

Summary Round purchases up to the nearest $1 and puts the difference into a tax-free account. You can add cash to your investments frequently and receive kickbacks from partner retailers to increase your investments.

This is Acorns’ lowest-cost option at $1 per month. Sign up by connecting your bank account, and linking any debit and credit cards to which you wish round-up investments.

Next, choose the amount you wish to invest in Acorns. The minimum investment is $5, but the app will not start investing until you have reached that amount.

Finally, you will answer questions about your financial situation, goals and tolerance for risk. Acorns will use this information to recommend one of five ETF-based investment strategies. If you prefer more or less risk, you can choose to override their selection.

You can also set up recurring investments which occur daily, weekly, or monthly in addition to your Round Up investments. Acorns Found money is also partnered to over 200 brands, which give cash back, automatically investing, for purchases.

Note that This account level was once free to college students for up 4 years. However, Acorns has discontinued this perk.

Invest + Later $2/month

Summary Original Acorns and the possibility to invest in an Individual Retirement Account.

Acorns has added retirement investments to its platform in 2018. Acorns allows you to invest in a Roth or Traditional IRA, as well as an SEP IRA. Your Acorns Later account can be accessed in the same manner as the original Acorns service.

Invest + Later + Spend $3/month

Summary Acorns Online Checking Account with Full Bank Services, FDIC Insurance, and the ability boost your Acorns + Acorns Later Investments with Instant Round-Up and Cash Back from Local Retailers

A digital checking account is the latest addition to Acorns’ platform. The account allows digital direct deposit, mobile deposit and payment and unlimited fee-reimbursed ATM withdrawals.

Acorns Spend offers real-time Roundups and custom spending strategies to increase your savings. You can also get Found Money cash-back up to 10% from places you frequent.

What is the Work of Acorns?

Acorns’ investing platform, like many robo-advisors is based Modern Portfolio Theory which was created by Harry Markowitz. You can choose from five optimized portfolios and it automatically rebalances and reinvests any dividends.

ETFs (Exchange Traded Funds) are the core of every Acorns portfolio. They offer exposure to multiple asset classes and provide exposure. These ETFs incur an average of 0.10% in internal expenses over the life of your investment.

This is how Acorns portfolios were broken down today:


Short-Term Government Bonds 40%
Ultra Short Term Corporate Bonds 40%
Ultra Short Term Government Bonds 20%

Moderately conservative:

Stocks of Large Companies – 24%
Stocks for Small Businesses – 4%
Real Estate Stocks – 4%
Government Bonds – 30 %
Corporate Bonds – 30%
International Large Company Stocks – 8%


Stocks of Large Companies – 29%
Stocks for Small Companies – 10%
Emerging Market Stocks – 3%
Real Estate Stocks – 6%
Government Bonds – 20 %
Corporate Bonds – 20%
International Large Company Stocks – 12%

Moderately Aggressive

Stocks of Large Companies – 38%
Stocks for Small Businesses – 14%
Stocks of Emerging Markets – 4%
Real Estate Stocks – 8%
Government Bonds – 10%
Corporate Bonds – 10%
International Large Co. Stocks 16%


Stocks of Large Companies – 40 %
Stocks for Small Businesses – 20%
Emerging Market Stocks – 10%
Real Estate Stocks – 10%
International Large Company Stocks – 20%

Acorns will help you invest the money you add to your account via Round-Ups and scheduled deposits based on your risk profile. This will happen in a taxable investment account if you use the basic Acorns account.

Acorns money can be withdrawn at any time. However, investment withdrawals may take up to seven business days. You don’t want your Acorns savings to be a regular source for cash.

Investing is a long-term investment. You can increase your chances of losing money by using this account to pay for daily expenses and goals.

Acorns Review: Commonly Asked Questions

Investors have many questions, given the variety of options available. These are some of the most frequently asked questions we’ve seen on the internet that we would like to address in our Acorns review.

Is it worth making small Round-Up investments?

Every little bit counts when it comes to saving money for the future.

Round-Up investments should be a core part of your investment strategy. No.

Even if you only invest $30 per month, a 7% return on your investment adds up over $4900 over 10 years. This amount is just below $3,900 if you put it in an online saving account money-market account. The gap between saving and investing only grows over time. This is compound growth.

What does Acorns cost you?

Acorns offers three plans

  • Invest, $1 per month
  • Invest + Later, $2 per month
  • Invest + Later + Spend, $3 per month

The $1 monthly fee for small accounts is prohibitive and negates any potential gains from investments.

Let’s say you had 50 Round Up transactions per month at an average round-up value of $0.40. Acorns would invest $20 each month for you, but would also take 5% in Acorns fees.

This percentage would decrease as your account value increased. You would have to have at least $5,000 before Acorns fees could be as low as Betterment’s 0.25%. Betterment has those fees without a minimum investment threshold, and you have access to a retirement plan. To match Betterment’s fees, you would need to invest $10,000 in an Acorns IRA.

What does a $1/mo fee mean for a taxable account:

BalanceAnnual Fee

What are the risks of investing in Acorns?

Performance is not guaranteed as with all investments. There are risks involved in investing. This means that your portfolio’s value can fluctuate over time. The S&P 500 has delivered consistent returns of around 8% each year, but there are always variations from year to year that could cause your account to lose substantial value, sometimes exceeding 10%.

Acorns users are most at risk if they decide to stop contributing to their account. Keep in mind that the monthly fee will have a greater impact on your overall account balance the smaller the account balance.

A high-interest savings account is the best option if you have long-term plans for your money.

Are large amounts of money acceptable to be invested in Acorns?

Flat-rate fees may be attractive for investors who are not as hands-on and have large amounts of money to invest. Acorns is a cost-effective option if you have more than $10,000 to invest in the Invest + Later level. Your fees will drop below those of top robo advisor competitors such as Wealthfront and Betterment.

Acorns is not a good investment option for large sums of money. Acorns’ investment options aren’t as robust than those of the larger players. Portfolios offer less diversification among asset types and are not customizable beyond the five core portfolios.

Additionally, if your primary investment is in a taxable account (the Basic Acorns level), you won’t receive tax loss harvesting to increase long-term returns that many of your competitors offer.

Acorns doesn’t provide professional financial advice. Some robo-advisors have access to Certified Financial Planners (CFPs), who can answer any of your questions. Although you might not have one today, they can be helpful as your portfolio grows and the market slows down.

For whom is Acorns most effective?

Acorns is the best option for investors looking to grow their savings.

Acorns App Review Summary

Acorns is a leader in round-up investment apps. It is simple to use, offers a great education platform for investors new and has straightforward fees.

The amount of your account balance will determine if the $1-3 monthly fee is beneficial or detrimental. The $1 per month fee will not hinder your investment growth if you are only adding a few bucks a month to Acorns. $10 Bonus $5 Account Minimum FreebeiBlogger Rating

The Acorns app makes it easy for investors to get started. A linked card is used to make purchases by investors. Acorns rounds up the dollar to the nearest dollar, and then invests the extra money. Acorns users can set up automatic recurring investments on an individual basis, such as a weekly, monthly, or daily basis.

About the author

Hi, I'm Lisa. I went from losing everything in my divorce, to beating all odds and becoming a financially free, independent Woman. My blog is about gaining financial freedom. Thanks for supporting my journey!

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