Acorns is a micro-investing app that rounds up users’ purchases and invests the spare change into a diversified portfolio of Exchange-Traded Funds (ETFs). In this post, we’ll explore how Acorns makes money, and what the app’s business model is all about.
Acorns make money through a monthly subscription fee. The fee starts at $3 per month for the personal plan, which includes the core round-up investment feature, checking account and IRA retirement accounts. Acorns is $5 per month for the family plan of Acorns early which is an investment account for kids.
Acorns does not charge transactional fees, commissions or fees based on assets for accounts under $1 million.
Acorns may receive compensation from business partners in connection with certain promotions in which Acorns refers clients to such partners for the purchase of non-investment consumer products or services.
Acorns History
Acorns was founded in 2014 with the goal of making investing accessible and simple for people who may not have much experience with finance or who may not have a lot of money to invest.
The app has since grown to over 10 million users and has become one of the leading micro-investing apps on the market.
Sign up for Acorns and Earn a free $5 dollars to help start you on journey to financial independence.
Acorns Fee’s
You can start investing with Acorns for $3 dollars a month. This plan is the personal plan and will give you access to investment, retirement, and checking accounts.
You will also have access to Acorns Grow and Acorns Eran. Acorns Grow gives access to helpful articles for personal finance development. Acorn Earn helps you earn more money when you shop and can help you find a job.
Acorns offers a Family plan for $5 dollars a month it has all the same features as the personal plan but gives you access to Acorns Early which allows you to start an UTMA/UGMA for kids.
Acorn Earn
Acorns Earn is another way Acorn makes money. It offers subscribers access to shops with acorns partners and earns bonus investments into your Acorns invest account when you purchase something from their partner brands.
Acorns may receive compensation from business partners in connection with certain promotions in which Acorns refers clients to such partners for the purchase of non-investment consumer products or services.
This type of marketing partnership gives Acorns an incentive to refer clients to business partners instead of to businesses that are not partners of Acorns.
This conflict of interest affects the ability of Acorns to provide clients with unbiased, objective promotions concerning the products and services of its business partners.
This could mean that the products and/or services of other businesses, that do not compensate Acorns, may be more appropriate for a client than the products and/or services of Acorns business partners.
Subscribers are, however, not required to purchase the products and services Acorns promotes.
Now that you know how Acorns as a company makes money let’s look at how you can make money with Acorns.
7 ways to make Money with Acorns
- Investing your spare change: By using Acorns, you can automatically grow your investment portfolio by investing the spare change from your purchases into a diversified portfolio of ETFs. The app’s investment portfolios are designed to help users achieve long-term growth, so the more you invest, the more you can potentially earn over time.
- Earning cashback through partnerships: Acorns has partnerships with over 350 brands, including Airbnb, Uber, and Lyft, where users can earn cashback for purchases made through the app. The cashback earned through these partnerships goes directly into users’ investment portfolios, allowing them to grow their investments even faster.
- Compound interest: Maximize the power of compound interest by investing early and letting your investment grow over time.
- Diversification: Acorns spread your investment across different assets such as stocks, bonds, and real estate to minimize risk.
- Patience: Investing requires patience and avoiding the temptation to sell during short-term market fluctuations. With Acorns you are investing into the feature and understanding that time in the market is the way to grow.
- Compound interest: Maximize the power of compound interest by investing early and letting your investment grow over time. Acorns is set up for auto deposit and truly takes advantage of compound interest.
- Utilizing the Grow financial education platform: It provides personalized financial advice and information to help users improve their financial literacy and grow their investment portfolios.
It’s important to remember that investing always carries some level of risk and that past performance is not a guarantee of future results.
Before investing with Acorns, make sure to understand the risks involved and consider your investment goals, risk tolerance, and time horizon.
Conclusion
Acorns makes money through a combination of monthly subscription fees, investment management fees, referral fees and partnerships, the sale of premium financial products and services, and the Grow financial education platform.
The company’s business model is designed to make investing simple, accessible, and affordable for users, while also providing valuable financial services and resources. By focusing on these key areas, Acorns is able to generate revenue while also helping users achieve their financial goals.