Acorns Vs Robinhood

Acorns Vs Robinhood [Which Investing App is Better? 2022]

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Acorns Vs Robinhood

The idea of investing your money to create more money in the stock market is something that has been growing more and more popular among younger people over the past several years. Many Americans are steering away from only investing in a typical 401(k) and instead are creating their own diversified portfolios. This has led to a mass of innovation among investment options and technologies, with many internet and mobile platforms rising up to meet consumers’ demands. There are hundreds of apps available now that allow users to invest in everything from stocks, mutual funds, bonds, and cryptocurrencies all the way to wine and sneakers!

Investing your hard-earned money is something that can have a profound impact on your life; in fact, billionaire investor Warren Buffett once spoke of the power of investing when he declared “if you don’t make money when you are asleep, then you will work until the day you die.” So, if you don’t want to work forever, you better start investing! 

Two of the most popular stock market investment apps out there today are Robinhood and Acorns. Both of these investing platforms have many different features that can get you started in investing and then help you grow your wealth. While they share some common traits, both of these apps are very different from one another. As an investor, you can either choose to work with one or both of these apps due to the fact that their features are capable of complementing each other. Let’s take a closer look at Acorns Vs Robinhood, so you can determine if one or both of these apps is a good fit for you. 

Onto our Acorns Vs Robinhood review!

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How Acorns Works

Acorns is an app that essentially works along the lines of the robo-advisor model. This means that the asset allocation plan is taken care of for you, and all you have to do is put your money in and choose the type of portfolio that you’d like to work with. This is a great feature for someone who is not looking to do a lot of research in order to invest, or who doesn’t have the time to do intensive research on potential investments. It is, of course, always a good idea to understand where your money is going so research is always going to be necessary. However, with Acorns, there is going to be less research required than you would need with Robinhood. 

Investing with Acorns has become very popular due to their most notable feature, the app’s automatic investments of spare change. Acorns users all have the option of investing the spare change required to round off to an even dollar amount every time they swipe their debit card on a standard purchase.

For example, if you were to purchase a sandwich for $4.50, Acorns would round that purchase up to $5 and then invest the leftover $0.50 into your account. This is something that, if done consistently over time can grow to be a considerable amount of money; essentially, you are building wealth with the spare change you’d otherwise lose in your sofa cushions!

Acorns is more of a long-term investment portfolio. It is best to put small sums of money (ideally through that dollar round-up system) into this account every month and let your wealth build; the longer the better. This allows for the money to grow and compound on top of it, potentially providing you a sizable return on your investment. 

Keep reading for more on Acorns Vs Robinhood below.

Types of Portfolios

As mentioned above, Acorns offers different kinds of portfolios that you can choose from. These are based on your risk tolerance and can be changed at any time. With that being said, here are all of the portfolio options that are offered by Acorns. 

  • Aggressive: This portfolio is meant for someone who is willing to deal with some volatility and risk in their portfolio in exchange for the potential of greater short-term gains. In this portfolio, your investments will be diversified by the following percentages.
    • 55% Large Company Stocks
    • 10% Medium Company Stocks
    • 5% Small Company Stocks
    • 30% International Company Stocks
  • Moderately Aggressive: There is also a higher threshold of volatility in this portfolio, so you are going to want to make sure that you can take on a higher level of risk with this portfolio. In the moderately aggressive portfolio, your investments will be spread out with the following allocation. 
    • 47% Large Company Stocks
    • 6% Medium Company Stocks
    • 3% Small Company Stocks
    • 24% International Company Stocks
    • 6% Short Term USD Bond
    • 14% US Aggregate Bond
  • Moderate: With a moderate portfolio, your investments will start to become more conservative. Almost half of this portfolio is tied up in company stocks which means that there is certainly still a risk, just not as much. The allocation of this plan is as follows. 
    • 35% Large Company Stocks
    • 5% Medium Company Stocks
    • 2% Small Company Stocks
    • 18% International Company Stocks
    • 12% Short Term USD Bond
    • 28% US Aggregate Bond
  • Moderately Conservative: In the moderately conservative portfolio, you are going to be gearing more towards bonds as opposed to stocks. There is a significantly lower risk assessment with bonds so this is great for someone who cannot afford much risk. This portfolio is broken down with the following percentages. 
    • 24% Large Company Stocks
    • 4% Medium Company Stocks
    • 12% International Company Stocks
    • 18% Short Term USD Bond
    • 42% US Aggregate Bond
  • Conservative: With a conservative portfolio, you are taking on as little risk as possible. This will bring on less capital gain in the long run but there less volatility and lower chances of significant losses with this portfolio. The conservative portfolio is broken down with the following percentages. 
    • 20% Ultrashort Term Government Bonds
    • 20% Ultrashort Term Corporate Bonds
    • 20% Ultrashort Term Corporate Bonds
    • 20% Short Term Government Bonds
    • 20% Short Term Government Bonds

Understanding the different ways of investing with this platform is very important when going into a robo-advisor investing app. When debating on which of these you would like to go with, it is important to assess your risk tolerance. The truth of the matter is that stocks have the ability to drop in value, though, at the same time they carry far more upside potential than a bond does. If you have a high-risk tolerance, then you are going to want to go with either the aggressive or moderately aggressive portfolio. 

All in all, making sure that you understand where you are investing your money is a very important part of getting into investing. Fortunately, you do not have to do intensive research on dozens of stocks in order to determine which ones you want. The robo-advisor does that part for you. 

Other Features of Acorns

Acorns does have some other notable features that are getting attention from their users. These features have proven the innovation of this fintech app as they have been growing as a company since the start of the business. Here are the notable features that Acorns offer. 

  • Spend: With spend, you can open a checking account right on the app. You will receive an Acorns debit card that you can fund with a direct deposit. With the debit card, you can use it anywhere and get the spare change round up and can also use the ATM for free with thousands of ATMs. 
  • Early For Kids: This feature is excellent for parents who are raising children. With early for kids, you can set up recurring investments that appreciate over time. Once your child turns 18 you can turn the portfolio over to them. 
  • Later Starts Today: With later, you can invest money just as you would into your investment account, only with later you are investing in a retirement account. This money cannot be withdrawn until age 59 ½ but can provide a nice lump sum of money later in life. 

These are some of the most notable features of the Acorns investment app. There are many people who are receiving great benefits from working with this innovative financial platform. This app is a great way to invest in a robo-advisor environment where you don’t have to choose the individual stocks that you’re investing in. 

Fees With Acorns

As a robo-advising investment app, there are fees that need to be paid in order to work with Acorns. This is understandable because they are providing a significant service for you. The fees aren’t exorbitant but depending on your portfolio size it may be a sizeable percentage. 

To invest with Acorns, you are going to expect to pay anywhere from $1-$5 per month depending on what kind of plan you pick. This is a small price to pay for the returns that you are likely to see if you are sticking to Acorns for the long term. If you think of it this way, you’re probably spending triple that amount on your favorite streaming service every month, so it is certainly worthwhile to spend a few bucks a month on your future.

The downside is, if you have an account that is only valued at $100 then $5 is 5% of your portfolio. 

RELATED: Acorns Vs Stash.

Pros of Acorns

Acorns is a trusted app that has been getting more and more attention as it continues to offer more benefits to users. Here are some of the highlights of working with Acorns. 

  • Low minimum balance: You only need $5 to get started with Acorns.
  • Easy way to invest your money: You are able to invest in a hands-off portfolio, all you have to do is put the money in. 
  • Round-Up Investing. The app enables you to invest the spare change you have left over from everyday financial transactions. 
  • Educational Content: Acorns regularly posts articles to their website that seek to educate readers. 

These are just a few of the many benefits that could be you could be receiving by investing your money with Acorns. Overall, the Acorns team has developed an outstanding platform that is trusted by investors all over the United States.

Cons of Acorns

As with any financial services platform, there is always going to be room for improvement in some areas. Here are a couple of the things that Acorns could work on.

  • Only robo-advised: It would be nice to see Acorns allow investors to dive into creating their own individual portfolio. As of right now, they only allow for robo-advised investing. 
  • Relatively high fees for low value accounts: If you have a small account, then you are going to have a high percentage of your overall portfolio go towards fees. If you have a $100 portfolio then you are going to be spending 12% of your overall portfolio on fees. There is, however, a silver lining to this as it benefits those who have large portfolios. If you have $10,000 in Acorns, then you will only be spending $0.12% on fees.

Check Out Acorns

Acorns Vs Robinhood – which one is best? Head to the Acorns website to see if the app is a good fit for your investing needs.


How Robinhood Works

Robinhood grew to become so popular because of the fact that they do not charge any fees for you to invest. This had many investors flocking to this app when it first came out, but there have since been many other apps that have come out with no fees. This isn’t to take away from Robinhood, but it is certainly not a major distinguishing feature for a financial services app today.  

This brokerage app is best suited for those who are just breaking into the world of investing. It differs from Acorns in the sense that this is not robo-advising. Instead, with Robinhood you are doing all of the investing yourself. This is an excellent thing if you want to have full control of your investments, but this is something that may not come easy, especially if you do not have much experience with stocks, mutual funds, and other types of investments.

In order to build up a successful investment portfolio, you are going to have to research the nature of the stock market as well as the individual companies that you intend on investing in. 

To dive into the platform, Robinhood offers some cool features that are of great benefit to investors. Users have the ability to trade both stocks and cryptocurrencies on this platform, a feature that not many other financial platforms currently offer. This makes it nice for those who are trying to diversify the types of asset classes they invest in. 

Robinhood takes small investing a step further by allowing investors to purchase fractional shares of both stocks as well as for cryptocurrencies. This means that if you are looking to invest in something whose shares are highly valued, like Bitcoin or Amazon stock, then you don’t have to put up all of the money to purchase the entire share. This is great because you can build up an investment in a cryptocurrency or a high-powered stock over time.

Another feature that has endeared Robinhood to its users is how simple and well-designed the platform is. Robinhood makes it very easy to set up an account, deposit funds, and start purchasing stocks. This makes it a great app for people who are just getting started in their investment life and want to move out smartly!

More from our Acorns Vs Robinhood review below.

Pros of Robinhood

Robinhood is definitely geared more towards people who are just diving into investing and is built to make that process as simple and straightforward as possible.

Here are some of the key benefits of using Robinhood: 

  • Ease of use: Robinhood makes it very easy to set up your account and invest your money. 
  • Fractional shares: If you want to invest in a company or cryptocurrency and don’t have enough money to purchase a full share then you are permitted to purchase fractional shares with whatever you have. 
  • Zero commission trading: With Robinhood, you are not going to be faced with any fees while you are making trades. 

Cons of Robinhood

As mentioned above, there is always going to be room for improvement with any investment app you choose. Here are some shortfalls that Robinhood should address to improve their users’ experiences on the platform:  

  • Lack of information resources: There are not many resources for you to be able to make an informed decision about a company to invest in. There is typically a synopsis of the company, but it is not anything in depth. If you are looking to invest with Robinhood then it is going to be very important that you do research outside of the Robinhood app. 
  • Too basic for experienced investors: Someone who really understands the markets and charts will likely need an investment app that goes further into the mix of things than Robinhood does. There are a handful of asset classes that are not offered by Robinhood. This will likely not matter to a new investor, but the experienced ones are likely to feel constrained. 

While there are certainly a handful of things that can be improved by Robinhood, this is still a great app that offers an excellent opportunity for new investors.

Check Out Robinhood

Acorns Vs Robinhood – which one is best? Head to the Robinhood website to see if the app is a good fit for your investing needs.

Is Acorns Better Than Robinhood?

Which App is Better? 

Acorns Vs Robinhood – which one is best? When putting Acorns up against Robinhood head-to-head, there isn’t much of a way to decipher between which one would be better. In fact, many investors use both of these apps due to the fact that they offer different services. There may be one that is better geared towards your specific goals, so in order to answer this question, you are going to have to answer some questions about yourself first. 

How do You Look at Investing? 

Do you want this to be a process that is something you do more passively? This would mean that all you have to do in order to build your portfolio is fund it. That is something that is offered by Acorns and its robo-advisor investment system. You simply fund your Acorns account and then let the platform decide what stocks to invest your money in. This is great for someone who doesn’t really know what they’re doing and isn’t available to conduct extensive research in order to see success, or who doesn’t have the time or patience to invest on their own. 

Conversely, you may hate the idea of having someone else decide where your money is going. This would mean that you are looking at investing as something you’re going to do more actively. This certainly requires research and constant attention to your portfolio. If you either have knowledge of the markets or are willing to learn more in order to make successful trades, then you are likely going to benefit from Robinhood more than you would with Acorns. 

What Are Your Goals?

Are you looking to make money in your investments within the next 6 months to a year? Then, you are going to want to get into intermediate-term investing. This is something that can have you realizing decent returns in a shorter period of time, but it requires your attention and carries significant risk. If this is something that you’re interested in doing, then you are going to want to invest with Robinhood. 

Maybe you want to invest for the long term, but you want to have control over where your money is going, and you want to be able to invest in some of the better stocks that have the potential to increase significantly in value. This is something that can be best accomplished with Robinhood if you are willing to learn the ropes of investing. 

Alternatively, maybe you are looking towards taking a profit later in life and you don’t want to have to worry about your investments all of the time; maybe you’re too busy to be bothered with checking your portfolio every day, or every week. This would make Acorns a better fit for you due to the fact that you are able to invest your money in a hands-off manner. 

Acorns Vs Robinhood Parting Thoughts: You May Want BOTH of these Apps

Acorns and Robinhood are both terrific apps that are good for those who are looking to get into investing. Both of these platforms are used by investors all over and pose many great benefits. When it comes to deciding if one or the other is better for you, what matters most is what you are trying to get out of your investments and how you’d like to go about investing.

Not surprisingly, there are many investors who like to use both apps, as the services offered by Acorns and Robinhood can be complementary. So, take a moment to consider your investment goals and the time you have to manage your portfolio and decide whether one or both of these apps is what you need to start building your wealth.  


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