Robinhood vs Acorns: Which Is Better For Your Investing Style?


SamuelBrownNG / Getty Images / iStockphoto

Over the past decade, investing has become easier and more accessible. Just 20 years ago, you would have had to fill out a dozen pages of paperwork in an investment adviser’s office if you wanted to buy stock in the company. Today, that same opportunity is just a few clicks away from your phone, thanks in part to apps like Robinhood and Acorns.

Preview of Robinhood and Acorns

Robinhood and Acorns both aim to make investing easier for the everyday consumer. However, they do it very differently, so it’s important to understand the differences between them.

About Robinhood

Robinhood debuted in 2015. Its head office is located in Menlo Park, California, and is best known for its introduction to commission-free equity and exchange-traded fund trading. Robinhood, which filed its initial public offering this summer, has 18 million funded accounts and approximately $ 80 billion in assets under its management.

The founding concept of Robinhood is that the financial system should benefit everyone. Its clients have access to news and information, stocks, options, exchange-traded funds, cryptocurrencies, and cash management services.

About acorns

Acorns was founded in 2012 in Irvine, California. It focuses on micro-investment and robo-investment. Its motto is “Cultivate your oak” and its mission is to help users save and invest. Acorns offers a collection service, taking a client’s change and investing it in a professionally managed wallet.

The company also offers a debit card with the round-up function, an individual retirement account and an investment account for children. In 2020, Acorns had more than eight million customers and approximately $ 3 billion in assets under management.

Features and services

Robinhood and Acorns both offer cash management services, investment accounts, and educational content. Robinhood, however, tends to focus on the more sophisticated investors, while Acorns aims to reach the average consumer who wants to save and invest more but isn’t quite sure how.

Robinhood Offerings

  • Individual share purchases: Equities and exchange traded funds
  • Options: Calls, sell options and more
  • Gold level: Research reports, larger instant deposits, low interest loans and more
  • Finance management: Pay bills, send checks and more
  • Cryptocurrency: 24/7 access to Bitcoin, Ethereum, Dogecoin and more with an entry point from $ 1
  • Data: Investment news and information

Acorn offerings

  • Tassels Invest: Professionally managed smart wallet with bundle functionality
  • Acorns later: Individual retirement account with consolidation function
  • Acorns early: Investment account for children
  • Durability: Portfolios based on exchange-traded funds in the environmental / social / governance space, also known as ESG
  • Verification: FDIC insured checking account with smart deposit and roundups

Comparison of fees

  • Instant Robinhood: This is the company’s default account. It provides access to instant deposits of $ 1,000 or less, as well as extended trading hours. This is a margin account and certain fees apply.
  • Gold Robinhood: All the features of an Instant account, but with the added possibility of making margin investments. The gold level also includes access to more sophisticated data and market research. It costs $ 5 per month.
  • Robinhood Money: This is a basic account that offers access to instant deposits up to $ 1,000, but no access beyond that point and no ability to trade with unsettled funds. It’s free.
  • Personal tassels: Access to investment, retirement and checking accounts, plus a debit card, bonus investments from affiliate retailers, and financial news and advice, all for just $ 3 per month.
  • Acorn family: Investment accounts for adults and children, retirement accounts and chequing accounts, plus a debit card, exclusive offers and content for only $ 5 per month.

Mobile app experience

The Acorns app comes out the winner on iPhone and Android devices, but both apps are well regarded overall and offer extensive reporting and functionality.

Application App Store / iPhone Google Play / Android
Robin Hood 4.1 3.8
Tassels 4.7 4.3

Who should use Robinhood?

Since Robinhood offers the ability to make individually selected stock purchases, it is best for those who want more convenient control over their investments. A Robinhood user has access to typical investments, like stocks and mutual funds, as well as more unconventional choices like cryptocurrency.

Who should use acorns?

While Acorns offers a handful of products, all of them are professionally managed, which means they’re aimed at people who want strong portfolios without the practical implications. Acorns does not offer the option of making hand-selected investments and does not offer access to less traditional investments like cryptocurrency. With Acorns, an investor can answer a few key questions about their investment goals and then be led to an asset allocation that matches those goals.

Good to know

While Robinhood and Acorns have grown in popularity, they also experience ups and downs that are often associated with rapid growth.

Robinhood’s revenue grew from $ 277.5 million in 2019 to $ 958.8 million in 2020, an annual growth rate of 245%. The company filed for its initial public offering this summer and has become a publicly traded company. However, Robinhood has not been without scandals – from a user misled with fatal consequences to their role in the GameStop trade scandal. He has also come under scrutiny for using industry bribes, a process being assessed by US regulators.

Acorns, for its part, has grown to more than eight million users, helped in part by increased interest in investing amid the COVID-19 pandemic. During the same period, industry watchers noted that the company appeared to be losing weight. Acorns reportedly laid off dozens of people and closed one of its four offices in 2020.

Like Robinhood, Acorns reportedly intends to become a publicly traded company later this year and, prior to this change, it recruited experienced executives – most recently former Amazon executive David Hijirida, who will be chairman of the society. Acorns also plans to start offering cryptocurrency as an available asset in its diversified wallets soon.

Two different apps for two different audiences

Comparing Robinhood vs Acorns is similar to comparing apples and oranges. The two are part of the same family – investing, in large part – but Robinhood offers a greater level of autonomy while Acorns can help investors move forward in a more comfortable and guided way. Each service has a lot to offer and the choice between them simply depends on your goals.

If you’re interested in a more hands-on approach, Robinhood may be right for you. If you prefer to make safer, longer-term investments without having to do too much legwork, Acorns is the best option.

Our in-house research team and on-site financial experts work together to create accurate, unbiased and up-to-date content. We check every statistic, quote and fact using reliable primary resources to make sure the information we provide is correct. You can read more about GOBankingRates processes and standards in our Editorial Policy.

About the Author

Kelli Francis is a writer and content strategist. She started her career with a journalism degree from the University of Oregon and went on to work in some of the busiest newsrooms in the industry, from the Seattle Times to, WebMD and Yahoo. For nearly a decade at Yahoo, she worked as an associate editor at Yahoo Finance, specializing in personal finance content; a producer for Yahoo News; and an editor for the Yahoo homepage team. A lifelong researcher, Kelli is currently expanding her knowledge of all things finance as a student at the American College of Financial Services. She is also the very proud mother of a wonderful and unstoppable 7 year old child with autism spectrum disorder.


About Alma Ackerman

Check Also

Banco Santander (Brasil) SA (NYSE:BSBR) Receives Consensus Rating of “Hold” by Brokerages

Banco Santander (Brazil) SA (NYSE: BSBR – Get a rating) received an average rating of …

Leave a Reply

Your email address will not be published.