Growing to $1000+ in an Acorns Account

Last week, I opened my Acorns Account, which allows for incremental investing, as part of the Grow Your Dough Challenge. I downloaded the app from the Google Play store and followed the clear instructions step-by-step to open the Acorns account and connect it with my bank account. An account can be opened with a small amount of money (deposit $10) or you can deposit more, as well as set up a monthly automatic transfer of money from your bank into the Acorns account. In the process of signing up you answer a few questions to figure out your risk level in order to choose an appropriate investment portfolio. My analysis came up with conservative, but I feel I actually lean more to the moderate side, so I reset to the moderate portfolio. The chart below shows each the types of investments in my portfolio and the corresponding percentages.

The “Acorns” part of the name becomes clear when examining their Round-Up strategy, where the amounts you spend on purchases on your credit card are rounded up to the nearest dollar. From a few cents raised, grows a mighty account. Once you have totaled over $5 through Round-Ups, the money is withdrawn from your bank account and invested in the portfolio. You can also set your Round-Ups to increase by 2, 3 or 10 times — I’ve opted to multiple my Round-Ups by 2.

I am not starting this account with the full $1000 investment that is encouraged as part of the challenge, but I want to see if I can reach more than $1000 by the end of one year. I’ve decided to begin with a deposit of $400 with a further $50 per month being transferred to Acorns from my bank account at the end of each month. At the end of the year I should have purposely deposited $1000 = $400 + ($50 x 12). It will be interesting to see how much will have been added by the Round-Up process (I added $8.51 in round-ups in one week) and how well the moderate portfolio fares. I’ve done it this way to show those who don’t have $1000 to put down upfront, that they can also take charge of saving by putting aside smaller amounts more frequently.

Another opportunity to earn money with Acorns is by shopping with linked affiliated companies or participating in specific deals with the companies, under what they term the “Earn Found Money” part of the app. Some of the affiliates use a percentage of your purchase for the investment in your Acorns account and others have a set dollar amount. I was impressed by how many popular companies had teamed up with Acorns, including Amazon, Bed Bath and Beyond, Dick’s Sporting Goods, Expedia, FTD, GNC, GAP, Hertz, lyft, Macy’s, Nike, Old Navy, Home Depot, Ticketmaster, Uber, Walgreens and many more! I am not sure how much I will gain from this benefit of the account as it is hard for me to remember to go to an app or a partner website when I need to make a purchase, but I will try to be more mindful so I can save more money.

If you plan on opening an Acorns account, please use this Refer-a-Friend link. When you open your account, we will each get $5 in our accounts to invest in our portfolios. Acorns also offers Acorns Later, their IRA account, which I am not invested in.

A quick note on fees: the cost of an account is $1 per month for up to $5000 invested and then changes to .25% of your account balance once you are over $5000.