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Written by Ryan Scribner on February 5, 2020
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Is Acorns The Perfect Investing Tool For Millennials?

Is Acorns The Best Investing Tool For Millennials?

Millennials earned their name because they were born near, or grew up during the dawn of the 21st century – the new millennium.

If you’re among the first to be born into a digital world, you’re part of a group considered "digital natives." How greatly has technology been a part of the everyday life of a millennial? Consider this: it’s been estimated that they check their phones as many as 150 times daily. For some, that’s an estimate on the low side.

Despite being generalized as somewhat lazy, millennials work hard for their money – and also tend to spend much of what they earn. They may have enormous student loans to pay off, as well as daily costs like rent and car payments. Investing in the stock market for the future could be the last thing on their minds.

Juggling everyday expenses halts most millennials in their tracks from setting aside cash to invest. A Bankrate survey found that only 33 percent of people under 30 owned stocks in 2016 – probably because their monthly budget did not leave any extra money left over.

But there’s more to the story. Another survey from Bankrate found that millennials prefer cash three times as much as stocks for long-term investments. Now, that’s a bit alarming. When you sock your money away in a traditional bank, your return will be scant and will remain static in the longer term. The stock market, however, over the long haul, has produced return rates right around the 10 percent range. The younger you start investing, the more you’ll benefit from this return thanks to compound interest.

There are tons of reasons millennials don’t put thought – and as much available cash they can – into investing. Many think it’s just for stodgy older men who share tips over cigars in the country club. Others believe it requires a hefty start-up lump sum. Or they think it will be complicated and hugely risky.

Throw these misconceptions out the door! There’s a whole new age of investment platforms that are currently up and running, with results blowing competitors out of the ballpark, and millennials need to sit up and take notice sooner rather than later. They could be opportunity knocking on your Smart Phone (it used to knock on your door, but who opens their door anymore?)

What Is Acorns?

One of the most highly recommended online investment platforms is Acorns, and it may just be the ideal platform for millennials because it effectively banishes all these worries and outdated beliefs.

Acorns are micro and robo-investing at its best. Micro, meaning you can invest with tiny amounts of money, and robo, because the work is done for you, based on your goals.

How popular is Acorns? They have amassed nearly 4,000,000 people as their client base, and that number continues to grow and flourish.

Let’s take a closer look at what makes Acorns so noteworthy.

Spare Change Round-Up Investing

The basic account, Acorns Core, lets you launch your investment portfolio with pennies – literally. There is no minimum to open your account, and what’s more, you don’t have to overhaul your monthly budget to include a column for investments. Nor do you have to start preceding that morning latte or Saturday brunch with friends!

When you spend money on everything from your gym membership to your weekly grocery haul, you’re investing, because the platform rounds up your purchases to the next dollar, then funnels it into your Acorns portfolio. There’s no pain, but there is gain!

Acorns Core facilitates micro-investing of as little as one cent. It works this way: buy something for 99 cents, and Acorns will round it up to $1, with that extra coin tossed into your investment account. You get the idea.

This loose change comes from any purchases made from a linked debit or credit card or even your PayPal wallet, making it the very essence of found money.

Forget The Math!

Acorns do all the calculations for you. You won’t need to set up an Excel spreadsheet or do any math for that matter. The platform will round up your purchases to the next dollar, then invest it into your Acorns portfolio.

What’s more, your dividends are automatically reinvested in your portfolio.

Investors can sign up and launch their Acorns Core account for a paltry $1 a month. Can it be that simple? With Acorns, it can.

Oh, and if you’re a starving college student subsisting on leftover lo-mein, Acorns will waive the $1 a month fee. That’s right; you’re in for free.

We think it’s called Acorns because it allows millennials to store away cash for the future, so think of yourself as the squirrel and the investment money as – you guessed it – acorns.

Hitting The Big $5

To start, sign on with Acorns Core’s Invest the Change app and forget about it.

Once your round-ups total $5, the money is withdrawn from your linked checking account and invested, where it will gain momentum, letting you reinvest your dividends until you have a substantial portfolio. There are no minimums and zero commission fees.

This real loose change comes from any purchases made from a linked debit or credit card or even your PayPal wallet. After that, more than 150 experts affiliated with Acorns will keep an eye on all of your investments.

Acorns Investment Portfolios

Your Acorns account is a Limited Trading Authority account. You will be directed (or can even choose yourself) into one of 5 Acorns investment portfolios, but you will need to go with the flow on which Exchange Traded Funds (ETFs) make up those portfolios. Just answer some short, simple questions about your lifestyle and financial goals, and a mix of ETFs will become your starter portfolio.

ETFs are made up of stocks and/or bonds that often replicate an asset class or index such as S&P 500 or Dow Jones Industrial Average. In other words, they are mainstream, not off the beaten path.

Acorns Core seamlessly transfers those spare coins into investments diversified across more than 7,000 stocks and bonds (you read that right: 7,000). These are automatically rebalanced with market fluctuations up and down.

Conservative vs. Aggressive Investing

Here are breakdowns of how your money will be invested, based on your risk tolerance:


  • 12 percent Large Co. stocks
  • 2 percent Small Co. stocks
  • 2 percent Real Estate stocks
  • 40 percent Government Bonds
  • 40 percent Corporate Bonds
  • 4 percent International Large Co. stocks


  • 40 percent Large Co. stocks
  • 20 percent Small Co. stocks
  • 10 percent of Emerging Market stocks
  • 10 percent of Real Estate stocks
  • 20 percent International Large Co. stocks

One question you may ask is if you can choose your investments. You can not entirely opt-out of any of the ETFs in Acorns' portfolios, or of the stocks or bonds of which the ETFs are comprised. Also, you do not have the option of choosing to invest in any other stocks, bonds, Bitcoin, or other securities through Acorns. You may want to consider some other investing apps that allow you to pick and choose your investments.

If this list is interesting, but not understandable, no worries, more than 150 experts in Irvine, Portland, and New York take care of your investments. What’s more, they are guided by the genius of Nobel Prize-winning economist Dr. Harry Markowitz, who launched the development of all the portfolios and led the advisory board.

You can count on them to track your returns and make sure you stay in good standing. In other words, they’ve got your back.

Beyond The Round-Up

You can add to your wealth by making one-time investments from anywhere. Got an extra $10 from walking instead of calling Uber? A shuttle that right into your Acorns account and watch it take root. If you’re super organized, you can schedule weekly or monthly transfers from your bank account into your Acorns investments.

You’re in the driver’s seat when it comes to determining the flight path of your portfolio, which is a select combo of investments, often stocks and bonds that you own. Stocks are shares of ownership in a business. Bonds are a debt investment where investors loan money to a business for a defined period and an agreed-on interest rate.

Investments can take up to 3 days because as smart as the folks at Acorns are, they can only buy shares during the open stock market, just like the regular Joes.

Consider Your Financial Future

You may want to do some soul-searching about your financial future when you determine your investment objective because you’ll need to boil it down into one of 5 options:

  1. Long term investment
  2. Short term investment
  3. Major purchase
  4. Children
  5. Or, the always popular objective: General

Acorns Earn

Acorns Earn a long list of retail partners that will earmark an extra 5 to 10 percent of your transaction in cashback to your Acorns brokerage account. Who might these partners be? They include Nike, Apple, Airbnb, Macy's, DirectTV, Walmart, and others on a list far too long to dictate here.

Acorns Spend

Acorns Spend a debit card for a checking account with Acorns built-in. The account has no minimum balance requirement, no overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide. It’s a checking account with a debit card that saves, invests and earns for you.

Here is a list of the debit card’s features:

  • Technology & Design (The only debit card that saves, invests, and earns for you.)
  • Instantly Save & Invest (Real-Time Round-Ups, automatic retirement savings, custom Spend Strategies and more.)
  • Ease & Access (Digital direct deposit, mobile check deposit and check sending, free bank-to-bank transfers, and unlimited free or fee-reimbursed ATMs nationwide.)
  • No Hidden Charges (No minimum balance or overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide.)
  • Total Protection (FDIC-protected checking account to $250,000 plus fraud protection and all-digital card lock.)

Acorns Grow

Need to study up on the ins-and-outs of investing? Turn to Acorns Grow. It’s online access to a huge variety of tutorials and other educational content to help you untangle the complicated concept of smart investing. Just as an acorn seed grows, so will your knowledge of what it takes to win at the game of stocks, bonds, and securities.

Acorns Later

These are Individual Retirement Accounts (IRAs), both traditional and Roth. Acorns experts will recommend an IRA for you based on your goals, employment, and income, then keep you posted on how it’s doing. IRAs allow you to save money without all the tax implications of other investments.

You will be in good company: more than 250,000 have already signed on as retirement investors via Acorns. And if you already have an IRA or 401k, astute reps will help you roll it over into Acorns Later. As you approach retirement, your investments will begin to shift to line up with your goals.

Acorns Core plus Later comes with a monthly price tag of just $2.00.

If you want to throw caution to the wind and sign up for Acorns Core, Acorns Later, and Acorns Spend, it will cost you a ridiculous $3 per month.

It’s micro-investing at micro-prices.

Acorns are investing backed by experts, taking micro-investing to a whole new level, at costs so low you will never feel the pinch. With its wide array of products, Acorns just may be calling your name. Can you hear it?

What You Get With Acorns

To recap, for a low Acorns monthly fee, you get

  • Diversified portfolios
  • Automatic rebalancing
  • Access to Found Money partners to earn while you shop
  • On-the-go accessibility through it's mobile and web app
  • Investment support from its dedicated support team
  • Access to Acorns Later, the easiest way to save for retirement
  • Access to Acorns Spend, the debit card that saves, invests and earns for you
  • Use of Acorns Grow, to grow your knowledge and understanding of smart investing

Acorns are investing backed by experts, taking micro-investing to a whole new level, at costs so low you will never feel the pinch. With Acorns, you can start early and often invest, without making big changes to your everyday life.

Is Acorns the perfect investment tool for millennials? While nothing is perfect… this may be pretty close.

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Also, read:

acorns investing app
Article written by Ryan Scribner
Ryan Scribner is a personal finance YouTuber that is approaching 500,000 subscribers on his channel. He has created a thriving business around his passion, which is helping others navigate the complicated world of investing.

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