App teaches investment for beginners

Thanks to a new app, you don’t have to be a finance major to learn about investing — you can do it from your smartphone instead.

Acorns is a new app that is free to college students and aims to make the stock market less daunting to millennials who have little to no investment experience.

“Investing has always been something that has been challenging for people to get started with,” Acorns business developer Taylor Dance said. “We keep it really easy.”

This investment app links to a bank account and allows users to invest spare change in companies they frequent. For example, if one spends $1.70 on groceries, Acorns will automatically invest 30 cents from his or her account into an exchange traded fund. The app caters to students who have little money to invest but are eager to learn.

“You don’t invest a lot of money. You just invest spare change,” Wharton and Engineering freshman Yoni Dejene said. “It is a nice way to save and invest at the same time.”

The app serves both as a learning device for how to build and diversify a portfolio and as a means for long-term investment growth.

“People can actually get what we call ‘skin in the game,’” Dance said. “The best way to learn is to practice.”

Most users are charged $1 a month for the service, and users with accounts that contain more than $5,000 are charged 0.25 percent of their earnings. However, Acorns waives the fee for all students who sign up with their university email.

Dejene has been using Acorns for a year and a half and has seen a four to five percent return on his investment.

“This app gives you an easy way to start investing, without actually knowing about investing,” Dejene said. “If you use something like Acorns, you can sit back, relax, check on it from time to time and they do the work for you.”

The app has over 500,000 accounts and has received approximately 1 million sign-ups. Penn is in the top 50 universities currently using the app, and 70 percent of Acorns users are under the age of 35.

However, some students were concerned about using the app after reading reviews about users not making money.

“I was about to download the app, but then I read the reviews and it made me nervous,” College freshman Kerry Hollis said.

Dejene didn’t make any money in the first four months of using Acorns.

“This is about long-term investing,” Dance said. “This is about investing for the future. Sticking with it is a big deal. Recently, there has been a lot of volatility in the market, but in the long-term, this is something that will grow with us as we get older.”

The app serves as more than just a way to make money. It also provides a valuable learning experience to users.

“[Acorns] helps me get financial discipline,” Dejene said. “It showed me to be patient and slowly invest.”

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