Over the last year or two, I’ve been trying to save more money as a personal goal, but it wasn’t until I decided to use some investment apps, that it actually started to work.
First up is Public.
Full disclosure, unlike the other apps on this list, Public reached out to me and asked me to take a look at their app.
This slick, minimalistic looking app’s main function is that it can be used to make no-fee trades on the stock market. You can buy and sell stocks on any of the public exchanges without paying any sort of fee to do so.
Now, while this concept isn’t terribly new and there are other apps out there that can do that, Public has a few things going for it that are pretty unique.
Firstly, you can not just buy shares in stocks like you can on other apps, but you can also buy slices of shares of certain apps. So, for example, with a stock like Tesla that might cost $350 or so a share, you can just put in $100, or even as low as a $1 to purchase a proportionate percentage of a share.
It’s a small thing but it’s kinda nice if you don’t have a hedge fund budget to throw around.
The app makes finding stocks to invest in easier in my opinion and feels like it’s aimed at people who might not be that advanced in stock trading (in a good way).
When you search in the app you get headlines of the latest financial news; tapping on a stock gets you an organized look at the history of the stock, when earnings calls are scheduled, any news featuring the company, etc.; and you can also find new stocks based on themes like tech giants, the future is female, most popular, new kids on the block, etc.
Also one of the more intriguing aspects of the app is the ability to post your stock buying and selling with comments to your own profile (which you can share via a unique URL). You can, of course, then also find other people to follow in the app and see what it is they are buying and selling. I have to admit, as someone who is not experienced at all with stock trading, the ability to see what other people in my industry are buying or selling and why is a fun way to get a feeling of stocks I should maybe take a look at (and you can even comment/get feedback/etc. like any social network).
The last unique factor about Public I want to mention is that any money you deposit into the app will automatically earn you a 2.5% yearly return while not invested in any stocks. Now, the downside to this is it’s only up to $10,000 so the ability to use that as a long term savings account is a bit hindered, but that rate is way higher than any other app I’ve come across and a nice bonus.
As far as results, it’s individual stocks in the stock market so your results will vary for sure but I’ve only been using it for a week or so and my portfolio is up almost 2% and frankly it’s kind of a fun way to save/invest some money.
You can check out Public here.
This is the app on this list that is often referred to as the round-up savings app but its real name is Acorns.
The reason for that name is because the app sort of gained its claim to fame by letting you connect it to your bank cards and then you could set it to automatically round up every purchase you make to the nearest dollar and then transfer that amount to the Acorns money market account.
Once in that account, the money is then invested in an ETF or exchange-traded fund which is a collection of stocks and bonds (and you can choose between five different portfolios all based on the level of risk you are comfortable with).
The idea here is that historically theses portfolios provide a return a lot higher than your normal bank savings accounts (personally, I’m seeing about a 7.75% return over the last year in Acorns using the Moderately Aggressive portfolio vs the paltry 0.05% APY a bank would offer me. Of course, this isn’t guaranteed though like the Savings account is so keep that in mind).
The nice thing about this method of savings is it’s effortless. You just set it, forget it, and check on it later and (hopefully) be pleasantly surprised by the amount in there.
You can also increase the amount of money you’re putting into the account by either putting money in as a one-time deposit, of course, but you can also increase it automatically by adding a multiplier to your round-ups or set up a recurring deposit, as well.
Acorns also added two newer products, the first is Acorns Later which is a tax-deferred IRA. You put set up a recurring deposit for it and that money is deposited before being taxed as income, but you can’t withdraw from it, without a penalty fee at least, until you retire (my account says 59 and a half years old).
The other new product is Acorns Spend which is a debit card that lets you have a checking account basically (to try and make the app more of a replacement for your bank account) that then allows you to invest from it into your other Acorn accounts directly as well as give you up to 10% bonus investments from “select local businesses”.
Acorns does have a monthly fee, it’s $1/month for each of the accounts basically. So $1/month for your Acorns Invest account (the ETF) account, and then if you also add Acorns Later, it’s then $2/month, and if you add the Acorns Spend card on top of all that it goes to $3/month.
You can head here to check out Acorns.
The next app is meant to be more of a financial planning app it seems but also has a unique feature that makes it good for anyone trying to save money. It’s called Wealthfront.
For that financial planning aspect, you can connect any of the banks you have that are supported by the app to have it pull in the balance and spending data automatically (you can also manually add other assets and their balances if needed, as well).
In addition to this, you add in your income sources and the annual amounts you make from them and it’ll calculate your net worth.
Once done with that, you can then start to add goals. They let you choose from five options:
- Take time off to travel
- Buy a house
- Save for college
- Receive a windfall
- Expect a large expense
Once you add any of these in, there becomes a chart to help you decide whether or not at your current level you’ll be able to afford these things, when you can retire and what you’ll have in the bank by then, etc. (and you can adjust this to see different scenarios).
Now, all of this interesting but the reason this app is on my list here is because of their cash account.
You can open one of these with them and transfer any amount of money to it and will automatically earn interest every month on it to the tune of 1.82% annually (18x higher than the national savings account rate).
This rate, unlike the Public rate which is locked at 2.5%, is tied to the Federal Funds rate so when that goes up or down so does the APY of the Wealthfront account. When I started using Wealthfront it was at 2.24% and so it’s gone down twice or so to the current 1.82%. Still though, even at that, it’s way higher than most savings account and unlike Public has no limit so adding more than $10k to it (if you can, obviously) will yield higher returns over time.
In addition to the cash account (again my main reason for putting Wealthfront on this list), we also have ETFs like Acorns (under General long-term investing in the Wealthfront app), tax-deferred IRAs for retirement (again like Acorns), and they also have college investment accounts (tax-advantaged accounts that can only be used for educational expenses) so we have options for everyone really.
Lastly, we have another commission-free trading app similar to Public but for a different audience in my opinion. This is Robinhood.
And while the app still makes it easier to buy and sell stocks, it has a general vibe, at least to me, that it’s aimed at people already trading stocks (and is just a better way for those people to do so).
The app pulls in various headlines into the search section of the app, but they seem to have some partnerships with larger publishers like Bloomberg, The New York Times, Reuters, etc. to pull in not just stories, but also videos embedded directly into the app for you to check out (and presumably use to help you decide on what stocks to trade).
You can then search for the companies you want to trade and tap on them to get their stock history, analyst ratings on whether you should buy, hold, or sell the stock, along with their earnings (and audios of the earning calls in some cases as well), recent headlines showing featuring them, and a ton of statistics.
Robinhood also is launching a debit card (and cash account) that, like Wealthfront, is tied to the federal fund rate but is slightly lower at 1.8% right now. Right now, it’s on a waitlist, though.
Now, anyone out there nervous about putting their money into an app (I was at first as well, I get it), all of the ones on this list are either FDIC or SDIC insured to a minimum of $250,000–meaning that if something were to happen you are insured up to that amount.
And there you go. Let me know what you think in the comments below about these investment apps and feel free to add any others you might like. Thanks for watching!