The micro investing trend began over ten years ago when Acorns was created by a father and son duo who wanted to help people learn to save and invest a little at a time. Back then, people were skeptical of the concept, but advancements in AI technology and the rise of micro investing apps have helped change the conversation. Ask many Gen-Zer today if they are open to micro investing and, odds are, they’ll show you an app on their smartphone. 

Micro investing is trending because the apps are easy to use, accessible to everyone, and don’t require large minimum deposits. At Alloy Wealth, we feel that anything that helps people establish healthier financial habits is a good thing. Instead of spending every penny of what they earn, these apps help get users in the habit of putting money aside by making saving and investing automatic and effortless. What could be wrong with that?

Although micro investing apps have many positives, they do come with strings attached, including monthly fees, no human contact, and no tax loss harvesting. Even Robinhood, a popular commission-free trading platform, has its negatives. They don’t offer mutual funds or bonds, and they charge for the services investors really need like access to professional data and research, and low-yield cash options. 

Millions of Americans have managed to save and invest more than $30 billion collectively through micro-investing apps, but they are still not for everyone. Investors looking for more control over their portfolios, or those seeking higher returns, may not appreciate what financial wellness apps have to offer. If you are new to investing or on a limited budget, micro-investing apps can be a simple way to get started. Just keep in mind that as your financial goals become more complex, we are only a phone call away and ready to help you build a broader strategy tailored to your needs. Contact us at 800-689-3935.