Acorns Review: A Modern App That Helps You Invest More, Faster

Acorns might be for you if: You're interested in easy, automated investing. Acorns is a robo-advisor that automatically invests users' spare change. The platform has more than 8 million members and offers an easy-to-use app, along with straightforward pricing. If you're looking to simplify your investing, our Acorns review will help you decide if it's right for you.

Top perks

Acorns is one of our favorite robo-advisors. It ranks among the best we've seen in these categories:

Emphasis on automation

All robo-advisors are designed to make investing easy, but Acorns takes it a step further and makes investing automatic. Users link their other financial accounts (debit cards, checking, credit cards) to the Acorns app, and purchases are rounded up to the nearest dollar. For example, if you spend $4.79 on a coffee, Acorns rounds that up to $5 and puts $0.21 into your investment account. It's worth noting that even though you can connect credit cards, Acorns takes investment funds from a single linked checking account. To be clear, you can also set automatic recurring investments in addition to the round-ups.

Easy-to-use app

Acorns is an app-based investment platform. It has a user-friendly app with high ratings. On the App and Google Play stores, the Acorns app has a top-tier 4.7 out of 5-star rating.

Automatic rebalancing

Most robo-advisors rebalance clients' portfolios over time, and Acorns is no exception. In other words, once you choose one of Acorns' ready-made portfolio options, it automatically maintains your desired allocation.

Several account types

Acorns offers individual (taxable) investment accounts, and IRAs (traditional, Roth, and SEP). It also offers custodial accounts for kids. It does not offer trusts, 529 accounts, SIMPLE IRAs, solo 401(k)s, or joint investment accounts. But the account types offered should meet the needs of most investors.

Straightforward pricing

Most robo-advisor platforms charge a percentage of client assets, such as 0.25%, as their management fee. This can be difficult for many investors to fully understand. Acorns' pricing consists of a straightforward monthly management fee of $3, $5, or $9, depending on the level of account features. The all-in-one Acorns monthly fee is a big differentiator, and can be an especially big benefit for larger accounts.

Checking account access

Acorns customers in all of its membership tiers get access to the Acorns Checking account. The account offers an Acorns debit card with no-fee withdrawals at more than 55,000 ATMs, mobile check deposits, and no overdraft fees. Customers can get paid as much as two days early with direct deposit. This is a big differentiator. Most robo-advisors don't also offer checking accounts, so this can be very useful for investors who like to keep all their financial accounts in the same place.

Even more unusual, Acorns offers a market-beating APY on checking account deposits. It's less than you'd get from a high-yield savings account, but most checking accounts don't offer any interest.

Easy investing

Our general review of Acorns investing is that the process is very easy, and that's true with portfolio selection as well. Acorns has five investment portfolio options customers can choose from, taking the guesswork out of the investment process. Unlike many competitors' portfolios, they all have simple, easy-to-understand titles, like "aggressive" and "moderately conservative." If you want more selection, check out our best brokers for beginners. But for investors who want to keep it simple, Acorns certainly does. Slightly-more advanced investors can even add specific stocks to their Acorns portfolios, though this feature is limited to Premium subscribers.

Partner offers

Acorns offers members a program called Acorns Earn, a promotional platform like those offered by most credit card companies. Only, instead of giving cash back for a purchase through one of Acorns' partners, Acorns deposits the cash into the user's investment account. For example, you might see an offer for $20 of investment cash if you make a $100 purchase at one of Acorns' partners.

Acorns frequently offers its own deals and promotions for signing up or completing other activities. Check out our full Acorns promotions page for the latest.

What could be improved

No tax-loss harvesting

Several other robo-advisors offer tax-loss harvesting strategies. These can be a major source of tax savings for investors with large balances in taxable investment accounts. Acorns doesn't offer this.

No human financial advisors

Some robo-advisors offer clients some level of access to human financial advisors, but Acorns does not. If you want financial planning help from a real person, you'll need to look elsewhere.

Fees (for small accounts)

While Acorns' fee structure is very straightforward, it's also quite expensive for investors with smaller account balances. Even with the lowest tier (Acorns Personal), the $12 in annual management fees translates to 1.2% of a $1,000 balance. Top robo-advisors with percentage-based fees charge about one-tenth of that. However, the effective management cost goes down as the account grows and that annual amount becomes a smaller percentage. Acorns' fee structure is therefore favorable for investors with large balances.

Acorns started as a way for users to invest their spare change by rounding up purchases made with credit and debit cards to the nearest dollar and investing those small amounts. It still has this functionality, but in our Acorns review we find that it has evolved quite a bit since its early days. It is now a full-featured robo-advisor that you can use to put your investments (including retirement accounts) on auto-pilot.

Acorns emphasizes automated investing. Its core feature is the "round-up" investment style. In a nutshell, customers link their financial accounts (such as credit and debit cards) to the Acorns app. When purchases are made, Acorns rounds up the amount to the nearest dollar and invests the difference. Customers can link as many accounts as they want, and can choose to round up every purchase or only certain ones, and Acorns takes these roundups out of the linked account and places them into the customer's investment account.

There's also an Acorns Spend checking account. It is available to customers in all but the lowest membership tier, and comes with a debit card that rounds up purchases without the need for another account.

It's important to emphasize that the round-up feature isn't the only way to put money into your Acorns account. You can set up a recurring deposit -- say, having $50 transferred every time you get paid. Or you can invest a lump sum (as little as $5 at a time) whenever you want.

Minimum investment

Acorns has no minimum requirement to open an account, but it does require at least $5 in an account to start investing.

Services offered

Acorns offers individual (taxable) investment accounts, as well as traditional and Roth IRAs, SEP IRAs, and UGMA/UTMA accounts for minors. To invest in anything other than an individual investment account, you need to pay for one of the two higher membership tiers.

This is a good mix of account types, as some robo-advisors just offer individual accounts. The addition of accounts for minors is a particularly nice feature that many competitors don't offer. But it isn't the largest variety of account types -- for example, you can't open a joint investment account with your spouse.

Unlike many other robo-advisors, Acorns doesn't offer tax strategies like automated tax-loss harvesting to investors. For people with relatively large account balances in taxable investment accounts, this can be a valuable feature, and it might justify looking elsewhere.

Pricing and fees

In our Acorns review, we discovered that pricing is a big differentiator. Instead of charging a fee based on client assets like most robo-advisors do, Acorns charges a flat fee of $3, $5, or $9 per month.

For $3 per month, users get access to the Acorns Invest platform, as well as the Acorns Later (retirement accounts) and Acorns Checking accounts. For $5 per month, Acorns adds premium educational services, emergency fund capabilities, and a bonus on earned reward investments. And finally, for $9 per month, users can unlock the Acorns Early (UGMA/UTMA) account types, Custom Portfolio capabilities, and more.

It's worth noting that while this flat-fee structure is somewhat unusual, Acorns invests clients' money in exchange-traded funds, or ETFs, just like most other robo-advisors do. And these funds have their own fees, or expense ratios, which range from 0.03% to 0.18% per year. To be clear, you never see these fees deducted from your account, but they're reflected in the performance of your investments.

When it comes to customer support, Acorns has good availability. There are no branch locations for in-person help, but Acorns' customer service is available through phone and email support seven days a week from 5 a.m. to 7 p.m. PT. You can also text chat with a representative 24/7 any day of the week through the app.

• You want to automate your investing as much as possible.
• You want a standard investment account, IRA, or custodial account for your kids.
• You want a checking account that integrates with your investing account.
• Your priority is simplicity.

Otherwise, if you want to have a hand in selecting your investments, one of our best stock brokers picks may be best for you, rather than a robo-advisor like Acorns.

Compare Acorns to other brokerages

Wondering how Acorns stacks up to the competition? Check out our reviews:

At The Motley Fool Ascent, brokerages are rated on a scale of one to five stars. We primarily focus on fees, available assets, and account types; however, we also take into account features like research, education, tax-loss harvesting, and highly rated mobile apps. Our highest-rated brokerages generally include low fees, a diverse range of assets and account types, and useful platform features.

See our full methodology here: Ratings Methodology