Acorns App Review (How Does Acorns Work)


Acorns is a micro investment application, based in the fintech sector. Acorns has been very successful with the idea of micro investment, to date the app has got over 7 million users. The app allows its users to save, in vest and then grow their investments over time, thus making the saving and investment function very easy for the common person who cannot take out time for personal financial management. In a way therefore, Acorns has automated the saving and investing aspect of personal financial management.

Acorns has certainly been well received by investors and mentors. Apart from institutional investors such as PayPal and BlackRock, the list of their investors and mentors includes Nobel laureates such as Dr. Harry Merkovitz, behavioral economists such as Shlomo Benartzi and celebrities such as Ashton Kutcher and Jennifer Lopez.

The idea driving Acorns

The main idea of Acorns is to help people save money and the app does this by rounding off every payment made with a linked debit or credit card to the nearest dollar and saving it. So for instance if a user made a purchase for $19.55 then the app will round it off to $20 and the difference that is 45 cents, will be saved.

The savings can be automatically or manually added into an investment account, where overtime the savings will accumulate a return on investment. This is micro investment at its best. People may assume that saving and investing a few cents is not worth it, well the real impact of micro investment can be seen in the long term. It may not save enough to change your life but the savings do stack up over time.

The app asks the users for their investment preferences and based on those preferences which include the risk appetite and expected rate of return, the app then invests the savings of the users in relevant and appropriate portfolios. Acorns has got five portfolios that vary by their risk profile.

· Conservative: Comprises of bonds of varying risk profiles. Very safe but carries low return.

· Moderately conservative: Comprises of 60% bonds and 40% stocks of varying risk profiles. Safe and carries a relatively higher rate of return compared to the conservative portfolio.

· Moderate: 60% large, medium, small and international company stocks and 40% government and corporate bonds. Slightly higher risk profile which is compensated by a higher rate of return.

· Moderately aggressive: 20% bonds and 80% stocks with 47% stocks being of large company stocks. Carries a higher rate of return.

· Aggressive: Comprises of 100% investment in stocks of large, medium, small and international companies with focus being on large and international companies for a higher rate of return albeit with a high risk profile.

The users will be suggested these portfolios based on the data they have submitted, if they do not like the suggested portfolio they can choose one they like. Acorns invests all savings into ETFs, the company has got Vanguard as their investment advisor and thus all investments are made through Vanguard into investment options of varying risk categories as mentioned above.


Acorns offers the following services through the app

· Acorns Invest

· Acorns Later

· Acorns Spend

· Acorns Early

· Acorns Earn

Acorns Invest

Acorns invest is the basic micro investment account that allows users to save and invest their spare change from the linked cards.

Acorns Later

Acorns later is the savings and investment account for those who want to save for their retirement. Acorns allows their users to set up their account to make automated or manual contributions to traditional, Roth or Sep IRAs.

Acorns Spend

Acorns spend allows users access to a checking account for their savings that comes with a custom built Acorns VISA debit card with all of the regular banking services such as digital banking, direct deposit, mobile check deposit and check sending etc. FDIC insurance covers the checking account for up to $250,000 with fraud protection and digital card lock.

Acorns Early

Acorns early is a service aimed at children, to develop the habit of saving and investing from an early age. Acorns also provides financial literacy content that can help inculcate good personal financial habits in children and other family members. Acorns early offers a UTMA/UGMA custodial account which means that the parents or guardians can deposit and invest the savings on behalf of the minor child. The savings can be withdrawn by parents for expenses relating to the child who is the beneficiary of the account. The child, upon reaching the legal age of maturity can gain full access to the account and use the funds as they deem fit.

Acorn Earn

Acorn earn is another interesting feature of the app. Basically Acorn has got over 350 affiliated brands that offer cash back to acorn users. Thus, the users can get a chance to earn cash back rewards from affiliated brands, the cash back rewards are added to the savings.


Acorns has got three simple tiers as their pricing strategy

· Lite

· Personal

· Family

Objective Opinion

Acorns has basically combined robo advisor with micro investment. A very potent combination when you look at the utility provided by the app. In simple terms, Acorns is a good app for saving spare change and investing it. The features for early investment for children and investment for retirement make it larger than a simple micro investment account. The cash back rewards can be quite handy at times however users who do not use their cards frequently may not find Acorns very effective at micro investment because Acorns relies on the user making a high volume of transactions through their linked cards in order to generate more spare change.

So What Is Next

1.) Open and set up your account

2.) Choose a risk profile

3.) Set up auto invest

4.) Set up round ups

5.) Let us know how everything went by joining our Forum.


Motivate yourself and encourage others.

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