Tag: microinvesting

Roboadvisor – Is it for me?

 

If you are asking this question, chances are you?ve realized that your money won?t grow while it?s sitting on the sidelines. Whether you?re new to investing, or only have a few dollars to risk each month, there couldn?t be a better time to get your feet wet and learn about investing.?With roboadvisors, the cost of entry is no longer a barrier, so?investment opportunities are available online to everyone.?

What is a roboadvisor?

Think of a roboadvisor as a personalized virtual broker. Roboadvisors use computer algorithms to provide customized financial planning with lower costs. Many have user-friendly apps that interact with you, ask you questions about your financial goals, interests, age, and risk tolerance (how much can you really begin to invest without hurting yourself). Based on your responses, they can help you make good decisions, and learn along the way.

Human brokers have been using automated portfolio allocation software for years. So this idea isn?t new. The primary difference between a roboadvisor and a broker is accessibility and price. Roboadvisors open the world of investing to everyday people.

Pros
  • Fast and easy to use investor-friendly apps.
  • Education friendly. Learn as you earn.
  • You can start with micro amounts ($5).
  • Accessible 24/7. (You can change your mind at 3am.)
Cons
  • Investing is not a savings account. There is a chance that the assets could go up or down in any given year. On average, the stock market goes down 1 out of every 3 or 4 years. So you need to be able to hold on for the long term.
  • While the services are easy, you will want to ask yourself some straight questions before you decide which roboadvisor is right for you.
How much should I invest?

Start with something you feel comfortable with. This could be as little as $5. Invest an amount that you know wouldn?t hurt you if you lost it. If it?s fun, chances are you?ll stick with it. Sticking with it is important because investments grow over time.

What should I invest in?

What do you believe in? Invest in your interest and beliefs.?Making money isn?t as fun when you are doing it at the expense of others, or contributing to social and environmental problems. Today, you can easily pick an issue you care about and point your dollars at it. If you invest in something you care about, you?ll stand a better chance of staying with it and growing your investments.

How much does it cost?

The key to picking an investment, especially if you’re starting out small, is to minimize fees. Online investment opportunities are quite transparent about their fees. When you?re learning, you need flexibility. An online broker that charges you $7-10 bucks every time you want to change something probably isn?t a good place to start.

Where do I start?

There are more and more online investing platforms entering the market every day. If you want to start small with as little as $5 or $50 bucks, learn as you go, and invest in what interests you, here are some of the better options out there.

 

Roboadvisor
 

Minimum Investment
 

Fee
SRI* Options?
Stash

$5

$1 per month?up to $5,000

Yes

Swell

$50

0.75% annually

Yes

Wealthsimple

$0

0.50% annually

Yes

Betterment

$0

0.25%-0.40%

Yes

motif

$1000

$9.95 per month

Yes

*Socially Responsible Investing (SRI) options

The investing world can seem complicated, but it doesn?t have to be. There are opportunities available to you today that your parents didn?t have. So, if you’ve been hanging out on the sidelines and wondering how to start, dive in. Start small and earn as you learn.?


Photo by?Luke Porter

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How To Trick Yourself Into Stashing Money

You know how you?re supposed to floss but you just don?t??

You?ll be on a weekend trip with some friends, see one of them floss, and that annoying guilty feeling creeps in…?Why? Because you know better.

Same with investing money.

Why is it that even though we know we need to invest to grow our money, we just don?t do it??Many of us freeze when it comes to complicated financial decisions because, well, they?re complicated.?And most of us don?t have extra money lying around to hand over to a broker or financial advisor and say ?Here, deal with this and make it grow.?

Wouldn?t it be awesome if we could just trick ourselves into stashing away money?

On top of that, what if the money we stashed was invested in an industry that we feel good about??And what if we could do it with as little as $5?? Without us having to do a thing?

Stash is an app that allows you to sneak as little as $5 out of your account into investments in sectors that you believe in.?

$5 impact investing. And you won?t even notice it.

They will even give you $5 to start investing.

Stash mainly offers a selection of Exchange Traded Funds (ETFs) via their platform that users can invest in. ETF?s are a bunch of investments, ?such as stocks and bonds, that are grouped together into a fund. This means that if you want to invest in a certain space like renewable energy, you can invest in a group of renewable energy stocks at the same time instead of just one company. So, you can begin to grow a diversified portfolio with a just few dollars.

You can invest in as many kinds of funds as you want, depending on your interests and passions. Stash offers a curated list of investments and includes sustainable investing options.

When you set up Auto-Stash, you can pick how much you think you won?t miss from your account, even if it?s $5.?You can sneak money – from yourself – and invest it!

Auto-Stash can be allocated to just one of your selected funds, or all of them. It?s up to you. You can stash money out once a month, or even once a week. And you can change the amount any time you want.

Before you know it, you?ll look at your little stash and see that it?s grown. And you won’t even miss the extra cash that you were going to spend on who-knows-what anyway.

This app tricks you into creating good money habits.

Learn While You Earn

You can track your investments while also learning about them on your Stash app.

Another great feature of the Stash app is its in-app educational content called Learn. Learn provides articles customized to your investment profile that help you understand the big picture, a little bit at a time, so your financial knowledge can grow alongside your money.

You won?t be overwhelmed by financial data. You can give yourself a little financial education while you?re waiting in line. If you want.?Or you can just ignore the whole thing and keep sneaking money from yourself and investing it …in yourself. Your choice!

Stash only charges a buck a month for investments under $5,000, and you get the first month free.?So, the next time you get that annoying cringy feeling when friends and family talk about money, maybe it?s a hint to start stashing some away for yourself.

The reality is that no one is going to look out for your financial future any more than they are going to offer to floss your teeth. You have to make that move. Stash is easy and can help you begin to build good investment habits.

Perhaps even easier than flossing. (Believe it or not, there?s an app for that, too)

 

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