Acorns Early review quick take: A simple way to save for the kids in your life by investing using a custodial account.
What is Acorns Early?
Acorns is a robo-advisor brokerage service offering people ways to invest and reach their financial goals.
Acorns Early is a UTMA/UGMA custodial account (Uniform Transfer to Minors/Uniform Gift to Minors). Unlike other accounts intended for educational expenses only (like a 529), Early funds can be used in various ways when they directly benefit the child, such as for a first car or extracurricular activities.
What are UTMA/UGMA accounts? These are the two types of custodial accounts opened for minors. A minor is a person under the age of 18 or 21, depending on the laws of the state of residence. With a custodial account, the custodian completes transactions on behalf of the minor.
Get started investing for your child with Acorns Early.
How Acorns Early Works
With Acorns Early, you can open custodial accounts for your child or any kid in your life. You can even start with as little as $5, giving the kids in your life a headstart.
Like Acorns Invest, the funds in custodial accounts are invested into Acorn’s exchange-traded funds (ETFs) or Aggressive Portfolio.
With Early, you must have an existing Acorns account and opt for the Family tier. Early accounts are separate from your personal investment accounts. However, you can transfer the custodial funds to the child’s Invest account once they are grown.
Have multiple kids? No problem. Set separate accounts for each child that may also include some potential tax benefits.
Key Features
- Automate recurring investments at just $5 per day, week, or month.
- Create multiple accounts for each child at no extra cost.
- Potential tax advantages.
- SIPC-insured up to $500,000. SIPC does not protect against market risk.
- Flexible funds: UTMA/UGMA), funds can be used in ways that directly benefit the child.
- Receive gifts: Invite friends and family to give a gift that can grow.
- Bonus savings and investments: Get exclusive offers that unlock bonus investments.
Pricing and Fees
Acorns charges a flat management fee and offers three tiers. To access custodial accounts, you must subscribe to the Family tier.
- Personal:$3 per month. All-in-one investment, retirement, and checking, plus a metal debit card, bonus investments, investment advice, and more.
- Personal Plus:$5 per month. Everything included in Personal with Mighty Oak banking that includes higher yields in checking and emergency fund savings, along with 25% match on bonus investments.
- Family:$9 per month. Get everything mentioned in Plus, along with a 50% match on bonus investments, access to GoHenry (a debit card made just for kids), $10,000 life insurance for qualified users, and a no-cost will to plan for your family’s future.
Pros and Cons
Pros
- Simple and automated ways to invest daily, weekly, or monthly
- Risk-appropriate, low-cost ETFs
- Potential tax benefits
Cons
- No access to financial advisors
- No tax strategy
- Unable to invest in individual stocks
Who is it best for?
Acorns Early is best for existing Acorns users who have children. If you like the simplicity of Acorns for your own investments, it can make sense to use it for your kids, too.
Acorns Early Review
Acorns is a legitimate company and Early is not a scam product. Acorn’s custodial account is a good option for parents and anyone who wants to invest for a kid in their life. If you currently use the app for your own investments, upgrading to the Family tier will give you access to custodial accounts. It will allow you to invest for your kids in the same ETFs.
During our Acorns Early review research, we learned the app is rated high, 4.7 out of 5 stars in theApp Storewith over 700k reviews. However, customers onTrustpilot have given it a poor average rating.
Having a UTMA/UGMA account can be beneficial over a 529 plan since the funds can be used for any purpose other than education. You can read more about taxes on children’s investments at IRS.gov.
Start investing for a child today.
How to Start on Acorns Early
Time needed:3 minutes.
Step-by-Step to Open an Acorns Custodial Account
- Getting started
Log in to your existing account or click here to open a new account.
- Choose Early
For new accounts, submit your personal information, set up a PIN access code, and log into your new account. Existing users can log in and click on Early to get started.
- Add Child’s Information
Just add a name, birthday, and social security number.
- Set up recurring investments
Automate contributions into the custodial account.
Acorns Early Alternatives
There are alternatives to Early that include Stash and Stockpile.
However, if you’re looking for college savings plans, check out Backer, a robo-advisor for 529s.
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