Stash Invest Review: Is It Legit?
Worried that investing is too expensive or overwhelming? You aren't alone. But Stash claims that with just $5, you can start investing confidently. Is it true?
Overall Score | 3.8 | ||
Annual Fee | 3.5 | ||
Minimum Deposit | 5.0 | ||
Customer Service | 3.0 | ||
Pros and Cons
- Invest with as little as $5
- Guidance to beginners
- Automatically invest extra funds
- Fees are high for small balances
- High ETF expense ratio
- Limited research
Bottom Line
Investment app providing guidance to beginners. Can invest with as little as $5
Micro-investing seems like it's here to stay. In other words, investing with just $5 is a real thing. It's not the same thing as a robo-advisor, though. Those companies manage your funds for you. Stash guides you but does not invest for you. That's up to you.
Stash makes it possible to invest by guiding you to the right investments and allocations. It spells things out in layman's terms to help you become an investor (assuming that's what you want). It's not a hands-off approach to investing. Instead, it's a hand-holding approach. Nothing is too complicated in Stash and if it is, they have more help to push you along.
Keep reading to see if Stash is right for you.
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How It Works and Who It's Best For
Stash is mainly for the beginning investor. If you are a truly thematic investor who is passionate about investing in certain themes, it could be helpful too, but the fees might scare you away (see below.)
Stash offers more than 250+ stocks and ETFs, the majority of which hold stocks. But they won't overwhelm you with options. Instead, your choices are narrowed down based on your risk level.
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With Stash Retire, you can save for retirement by opening a traditional or Roth IRA with a $5 minimum investment.
(Stash doesn't offer IRAs for small businesses or entrepreneurs.)
How To Get Started
- You'll answer a series of questions to evaluate your goals, age and risk tolerance.
- Stash then offers approximately 40 themes and 150+ single stocks/companies to choose from. The Stash Coach helps you stay diversified by recommending investments to add to your portfolio.
- Once you decide to move forward, you link your bank account to Stash and begin investing.
If you have experience in investing, however, you'll likely find the advice trivial and the fees too high compared to other investment companies.
What Are the Fees?
Stash offers three flat fee plans. Each is designed to fit a range of financial needs, from dipping your toes into the world of investing to maximizing your financial power with every tool.
Stash Beginner charges $1 per month. It gives you access to a personal brokerage account and banking services, including the STASH debit card with Stock-Back™ Rewards.
Stash Growth costs $2 per month. It includes a personal brokerage account, a retirement account (Roth or Traditional IRA), and banking services.
Stash+ is $9 per month. It offers access to a personal brokerage account, a retirement account (Roth or Traditional IRA), two custodial accounts for minors, and banking services, with double Stock-Back™ Rewards.
The App
Stash is available on Android and iOS devices, as well as online. The app itself is pretty useful. You can get a snapshot of your account and its potential with the click of a few buttons.
As it pertains to actual investments, you can learn everything you need to know about a theme in one screen. In layman's terms, you'll learn about the investment, see a graph regarding its risk level, learn the expense ratios, and see the underlying holdings in each ETF. You can also learn about specific companies/stocks.
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If you are into social sharing when it comes to investing, Stash is your app. You can link your social media pages, such as Facebook, and share investments with your friends. They won't see how much you invested or even the performance. You and your friends can simply share the investments you've chosen. Sometimes it can be the push you need to invest in a particular theme or stock.
Reasons We Like Stash
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- Stash offers many educational opportunities to help beginners learn how to invest. Stash really caters to beginners, which not many investment companies do. Even those that say they are for beginners don't break the lingo down into layman's terms as well as Stash. The Stash Coach does a good job of guiding new investors through every step of their portfolio. It encourages diversification and eliminates emotional investing.
- There is no minimum balance required. You don't need a minimum balance at any time with Stash. But, if you want to invest, you'll need at least $5 in your account to do so. They don't charge any fees if you are below that amount, though.
- You can buy fractional shares. If you can't afford a full share of a desired stock, Stash allows the purchase of fractional shares. They splits up the share among several investors to make it more affordable.
- You can open a custodial account. If you have children or grandchildren with an interest in investing or you want to start an account for them, you can open a custodial account. You must be 18 years or older to open your own account, so this gives younger investors a chance to get things going.
- You can invest in "themes." You won't see unrecognizable names of ETFs to choose from when investing. Instead, you'll see themes that you can choose from. From the themes, you will see the individual ETF options, again spelled out in layman's terms.
- Stash names the ETFs based on their theme. Beginning investors often can't decipher the ticker tape language used. Stash changes the names to things like American Innovators or Global Investment. This gives you a better idea of what to expect within the theme. Clicking on the desired theme will give you examples of the holdings within that theme to help you even further.
- You can see your portfolio's "potential" right in the app. This gives you the chance to see how things would change if you invested more aggressively or added more money to the account. The Stash Coach continually encourages habitual investing or saving to increase your portfolio and future earnings.
- You can track your progress with Stash's Milestones. Stash sets certain milestones for you and then helps you recognize/celebrate them when they are met. You'll see the milestones when you first sign up and then be congratulated when you meet them. This is another way Stash helps to motivate you to keep investing.
- Stash automatically transfers "extra" funds into your investment account. The Smart Stash option automatically transfers extra funds after monitoring your checking account for a while. If they see a chance to save a little extra money, they transfer it right into your Stash account. They do keep a specific and "safe" cushion in your checking account, though.
- You can withdraw funds at any time. Stash doesn't charge you to withdraw your funds. You can do so at any time without penalty.
Note: Funds are not immediately available. If your funds are invested in stocks or ETFs, you must sell the assets before withdrawing your funds. It takes 2 business days to execute an order, as this is an SEC regulation. You must wait 5 business days after selling the assets before you can withdraw the funds. This helps decrease the risk of fraudulent activity in your account.
Reasons You May Want to Look Elsewhere
- The fees are high for small investors. We discussed this above, but it's worth mentioning again. Small investors (investors with less than $5,000 invested) can pay a large portion of their investments in the fee. $12 a year doesn't sound like a lot, but when you only invest around $100, it takes away from your investment potential.
- The ETF expense ratio is often high. The average ETF expense ratio with Stash is 0.295%. This is quite high, since the average ETF expense ratios tend to range from 0.06% to 0.20%.
- There isn't a lot of opportunity for research. If there's one thing that's important when investing, it's research. Even though Stash is for beginners, they have very little to offer in the way of research. They offer plenty of education, but it's basic terminology rather than true industry research.
Check out our comprehensive guide on best discount brokers for beginners.
How it Compares
Stash vs Acorns:
Acorns helps you invest "spare change" by rounding up your purchase to the nearest dollar. Once you reach $5, they withdraw the funds from your linked checking account and invest the funds for you. It's a micro-investor and robo-advisor all in one, whereas Stash is a micro-investor, but not a robo-advisor.
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Stash | Acorns | |
|---|---|---|
Open Stash Account and Get First Month Free - | $10 Sign-Up Bonus - | |
Benefits and Features | ||
| Stock Trading |  | Part of service fee. Free for college students for 4 years. No add-on trading fees. |
| Annual Fee | STASH Beginner ($1/mo) STASH Growth ($3/mo) STASH+ ($9/mo) | Free for college students; $1/mo for Acorns; $2/mo for Acorns + Acorns Later; $3/mo for Acorns + Acorns Later + Acorns Spend |
| Minimum Deposit | ||
| Phone Support | Yes - normal business hours, plus Sat & Sun 11a-5p ET | |
| Live Chat Support | ||
| Email Support | ||
| Human Advisors | ||
| Assets Under Management | ||
| Tax Loss Harvesting | ||
| Goal Tracker | ||
| Automatic Deposits | ||
| Online Platform | ||
| iPhone App | ||
| Android App | ||
| Banking | Acorns Spend checking account comes with a debit card and has no minimum balance requirement, no overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide. $3/mo for Acorns + Acorns Later + Acorns Spend. | |
| Mobile App | ||
| Fractional Shares | ||
| Taxable Accounts | ||
| 401k Plans | ||
| IRA Accounts | ||
| Roth IRA Accounts | ||
| SEP IRA Accounts | ||
| Trust Accounts | ||
| 529 Plans | ||
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Stash: Pricing information from published website as of 08/14/2019 Acorns: Pricing information from published website as of 07/11/2019. | ||
Stash vs Robinhood:
Investors use Robinhood primarily to trade stocks without paying commissions. Unless you sign up for their Gold subscription, you don't pay any fees. Like Stash, though, they don't manage the investments for you. It's up to you to choose the investments and do the actual trading; they just guide you along the way.
Stash | Robinhood | |
|---|---|---|
Open Stash Account and Get First Month Free - | Invite Friends, Get Free Stocks - | |
Benefits and Features | ||
| Stock Trading | | |
| Minimum Deposit | ||
| Banking | ||
| Mobile App | ||
Stash: Pricing information from published website as of 08/14/2019 Robinhood: Pricing information from published websites as of 09/15/2019. | ||
Stash vs Betterment:
Betterment is one of the leading robo-advisors, but with no required minimum, it can be good for beginning investors as well. If you are looking for human advice and a more hands-off approach to investment, Betterment would be a better option.
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Stash | Betterment | |
|---|---|---|
Open Stash Account and Get First Month Free - | Get up to 1 Year Managed Free - | |
Benefits and Features | ||
| Stock Trading | | |
| Annual Fee | STASH Beginner ($1/mo) STASH Growth ($3/mo) STASH+ ($9/mo) | 0.25% for accounts under $100,000; 0.40% for accounts $100,000+ |
| Minimum Deposit | ||
| Phone Support | Yes - normal business hours, plus Sat & Sun 11a-5p ET | |
| Live Chat Support | ||
| Email Support | ||
| Human Advisors | ||
| Assets Under Management | ||
| Tax Loss Harvesting | ||
| Goal Tracker | ||
| Automatic Deposits | ||
| Online Platform | ||
| iPhone App | ||
| Android App | ||
| Banking | ||
| Mobile App | ||
| Fractional Shares | ||
| Taxable Accounts | ||
| 401k Plans | ||
| IRA Accounts | ||
| Roth IRA Accounts | ||
| SEP IRA Accounts | ||
| Trust Accounts | ||
| 529 Plans | ||
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Blank fields may indicate the information is not available, not applicable, or not known to CreditDonkey. Please visit the product website for details. Stash: Pricing information from published website as of 08/14/2019 Betterment: Pricing information from published website as of 04/04/2018 | ||
Bottom Line
Is Stash the choice for you? It depends if you are a true beginner and only have small amounts to invest. If you really want to get the hang of investing, this can be a great starting point. If you are more of a hands-off investor, this is not the best choice for you as you make all of the decisions and manage the funds. A robo-advisor is a better option for those looking for a more hands-off approach.
Disclaimer: Opinions expressed here are author's alone. Please support CreditDonkey on our mission to help you make savvy decisions. Our free online service is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content.
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