The guide to Investing Apps:
For example, take an app called Acorns. At the moment available only in the United States, this app automatically rounds up purchases to the nearest dollar and invests the difference in an index fund.
When you get the app, you can create a portfolio for a fee of $1 per month for accounts under $5,000.
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According to the official website, you can withdraw any amount from your Acorns account at any time without having to pay penalties. The portfolio is created using a mathematical framework that seeks to maximize expected returns for a given amount of risk by diversifying across multiple asset classes.
At the moment, Acorns has around 300,000 users who typically add $100 to their accounts every month.
Other investing apps that specifically target the millennial generation include Wealthfront and Level. Wealthfront offers investment management and advice services and its team includes financial experts like Burton Malkiel and Charles Ellis.
In order to create a diversified portfolio with Wealthfront, one has to invest a minimum of $5,000.
Level, the self-proclaimed “mobile money meter”, helps manage your money by automatically updating spendable cash as you make purchases and thus providing a real-time picture of your budget.
It works like a financial GPS, helping you to accomplish your goals by helping to make sound spending decisions.
The majority of the founders behind these investing and budgeting apps decided to create them after the financial crisis of 2008.
The combination of low entry costs, nice graphic design and automated investment facilities is what makes these apps appealing for millennials.
Photo: Shutterstock / collage: Martina Advaney
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