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It may be intimidating as a new investor learning the ropes but there are apps that are designed to help.
If you’re new to investing, the process of educating yourself and making the best decisions may seem daunting.
With numerous education options available, as well as investing platforms, it’s a good idea to do your homework before jumping in.
Beginning investors shouldn’t ever feel that more experienced market participants have some kind of secret sauce. With markets moving fast, and new trends such as artificial intelligence emerging on a regular basis, it’s challenging to filter out important information from the noise.
Fortunately, there are apps designed to allow new investors to confidently gain valuable experience.
Here are seven investment apps tailored for people starting their investment journey:
SoFi Invest aims to help investors develop a strategy especially for their financial goals and risk tolerance. It offers a self-directed investing account and a robo advisor option called Sofi Automated Investing.
In addition to its low-cost investment options, SoFi offers users the ability to track credit scores, find loan rates and even have a consultation with a certified financial planner.
The SoFi app is part of the company’s wider ecosystem, which offers student loans, personal loans, mortgages, credit cards, checking and savings accounts, and investment accounts.
The company recently rolled out a feature to allow IPO investing.
Investr helps new market participants learn about stocks through robust education features. For example, the app’s Fantasy Finance section lets users manage a $1 million virtual portfolio without investing a dime. In the old days, this was called “paper trading,” but Investr has advanced the concept for the 21st century.
Another way it’s aimed at newbies: Investr lets new users begin trading U.S. stocks, exchange-traded funds and fractional shares with as little as $5, and without commission fees.
For new investors who want an allocated portfolio tailored to their time horizon and risk tolerance, Betterment may be the right choice.
“Betterment operates as a robo-advisor, automating your investment strategy based on your risk tolerance and goals. It’s excellent for hands-off investors who prefer a set-it-and-forget-it approach,” says Jeff Rose, a certified financial planner and founder of Good Financial Cents.
Betterment also offers users the ability to connect with a financial advisor for personal assistance.
A potential downside, says Rose, is Betterment’s management fee, which is $4 per month, or 0.25% of your investing account balance if you reach $20,000 or set up recurring monthly deposits of at least $250. “While competitive, it’s still a cost to consider, especially if you’re starting with a small balance,” he says.
Investors should also understand that they have zero control over their investment choices with Betterment, making it less favorable for those who want to choose their own stocks or ETFs.
One of the best-known stock trading apps, Robinhood offers a wide range of services, including stock and options trading, as well as cryptocurrencies.
While new investors may not want to jump into all those features immediately, the site offers financial news and education for those who just want to dip their toes in. It also has charting features, for those who want to learn about technical analysis.
There’s no minimum account value, and Robinhood offers free stocks to users and a match on individual retirement accounts for those who subscribe to its Robinhood Gold service.
If you want to painlessly save a little more in your investment account, Acorns may be worth checking out.
The app’s claim to fame is that it allows users to round up their spare change from purchases and make extra deposits for investing. That’s done by using the company’s Mighty Oak debit card, which tracks purchases and automatically makes deposits in users’ investment accounts. Acorn users can also link existing debit or credit cards for spare change round-ups.
The minimum amount to begin investing is $5.
“I really recommend Acorns; it’s a set-it-and-forget-it account,” says Reem Khatib, managing owner of Tax Law Advocates in Santa Ana, California. “It allows one to enter into the stock market without spending all day and night researching or monitoring their stocks.”
For beginning investors, Ellevest has no minimum, though more sophisticated asset management services are available for high-net-worth clients.
The company focuses on teaching women about the markets, although anyone is eligible to open an account. It also places emphasis on environmental, social and governance practices, an area of interest to many female investors as well as younger investors of all genders.
The app offers ETFs and mutual funds, so it may not be the optimal choice for investors and traders who want to pick stocks, or those who want more control over their portfolio holdings.
Suma is a digital financial platform aimed at the Latino community. One of Suma’s goals is to “spice up dry and complex topics of investment, debt management, and creating and sustaining wealth.”
The app currently doesn’t function as a custodian or brokerage for investment accounts, as education is its chief goal. The app is packed with classes, challenges and goal trackers.
Consistent with its mission of making finance more fun, Suma uses the blockchain to certify attendance of its classes. It gamifies the learning by offering users non-transferable tokens that serve as badges.
Updated on March 25, 2024: This story was previously published at an earlier date and has been updated with new information.
