Acorns Review 2021

Acorns’ platforms won the award for the best digital design at the 2016 Good Design Awards, and for good reason. Its app and desktop version are minimalist, enjoyable to look at, and easy to use. 

Signing up is simple. Once you link your bank account, choose a subscription, and indicate your risk preferences — meaning how comfortable you are with market fluctuations and defining your time horizon and capital allocation, to name a few — Acorns will place you into one of five predetermined investing portfolios.

These include: conservative, moderately conservative, moderate, moderately aggressive, or aggressive. 

Users cannot select elements of other portfolios once their selection has been made. For example, a user cannot decide to have a portfolio that is partly conservative and partly aggressive.

They can, however, choose the half step of moderately aggressive — but if this is still worrisome, there is still the option to change your portfolio at any time.  

Acorns is well suited for those who want to be hands-off with their investments. Round-ups for purchases can be set automatically or manually if you wish to pick and choose which transactions to put toward investing. 

Although the main appeal of Acorns is the rounding up feature, you can also set up automatic transfers on a daily, weekly, or monthly basis.

This platform is ideal for beginner investors or for those with more experience who just don’t want to be as involved as other platforms require. 

One part of this process that I enjoyed was that I was provided an easy-to-understand explanation at each step. I had heard many of these terms such as moderate and moderately aggressive before but I was not sure how they applied to investing.

By having these explanations, I was able to learn more about portfolios and what each one entailed, which made me feel more comfortable with the process as a whole.

Acorns offers three plans: 

• The first is Lite at $1 per month; it allows users to invest monthly or in single lump sums. 
• The second tier is Personal, which is priced at $3 per month. This subscription allows users to invest, open a retirement account, checking account, or access a debit card.

The third option is Family which costs $5 per month. This subscription tier allows users to invest, save for retirement, access a checking account, and start an Early fund account for their kids.

These accounts are under the Uniform Transfers to Minors Act or Uniform Gift to Minors Act (depending on whether an UGMA or an UTMA account is offered, and the state where the account holder resides), in which the funds are automatically transferred to the child when they reach adulthood (between the ages of 18 and 25, depending on the state where the account holder lives).

Many other robo-advisors charge a management fee — Wealthfront, for example, charges a 0.25 percent annual fee of assets under management for accounts with a $500 minimum balance. It charges this fee, it says, because its business model is designed in such a way that it makes money only when its clients make money.  

Acorns also does not charge fees to manage ETFs outside of its flat-fee subscription, making its subscription tiers simple and transparent.

Though these fees may seem small, they can be a high percentage of your assets for those with small account balances. If you use Acorns only to round up your spare change for investments, you will not see the large account balances or growth compared to others who input higher lump sums. 

For example, an account with a balance of $100 will be charged $0.25 once a year with a .25 percent annual management fee seen with apps such as Wealthfront. The Acorns flat monthly fee for a Personal plan charges the account $3 each month regardless of the account balance, making it a 36 percent annual fee for assets under management.

Acorns fees as an annual percentage under management fee:

If you decide that Acorns is not the platform for you, and you select to close your account, your holdings will be liquidated and Acorns will send you the funds. There might be tax implications, but for small balances, that might be less than the cost to transfer to another organization.

If you have several funds with a few thousand in gains, you may choose to transfer in kind — and incur a hefty fee. There is a $50 charge to transfer each of your ETFs, for example.

This fee is not uncommon in investing platforms, but keep in mind that these fees can stack up; if you were to transfer four ETFs, for instance, you’d be looking at a $200 charge.

Acorns’ customer service line is fully automated. Users receive directions to a FAQ page that allows for searches or you can send a message. It is only after you submit a “help” request that you can find a phone number to call for additional support. 

Acorns states that all questions receive an answer within one to two business days. I sent a request asking if there were any fees associated with closing an Acorns account. I received an email reply 10 minutes later stating that my Acorns account had now been closed which, admittedly, was not what I wanted.   

I also called the phone number listed for immediate support. This automated phone line directed me to the FAQ page on the website before giving me a 15-minute wait time. Given the long wait time, this phone line was not immediate or supportive.

These messages are computer-generated and unfortunately misread my request. As an investor, and general user, this poor customer service despite my clear request was frankly a letdown compared to the sleek designs and pleasant user experience up until this point.

The Acorns app has a 4.8/5 rating out of 726,000 total reviews in the App Store and a 4.4/5 rating out of 145,573 total reviews in Google Play. Both include mixed reviews with the main complaint being that customer service was not up to par. 

Acorns parent company Acorns Grow Inc. has an A+ rating with the Better Business Bureau (BBB). However, to keep its rating, a company only needs to respond to customer complaints. Acorns Grow Inc. received 1.47 out of 5 stars in customer review ratings on the BBB’s site. 

Similar to the reviews featured in the App Store and Google Play, the frustrations of reviewers stemmed from poor customer service.