best investment apps

Best Investment Apps to Build Wealth

This is a guest post written by Enoch from Savvy New Canadians. Savvy New Canadians is a personal finance website dedicated to discussing relevant personal financial information as it relates to money, investing, freedom from debt, frugal living, entrepreneurship, productivity, creating multiple streams of income, and much more.

 

Investing in the stock market used to be challenging, expensive, and out of the reach of many ordinary folks. However, that’s no longer the case.

Today, there are multiple options to invest in stocks, Exchange-Traded Funds (ETFs), options, mutual funds, bonds, and other investment products.

Using one of the many available investment apps, beginner and experienced investors alike can access low-cost portfolio management solutions that in the past would have required you to be a high net worth individual.

If you are comfortable with building your own portfolios, the best online stock trading apps offer commission-free trading using your smartphone and have no-minimum balance requirements.

Also, you don’t need to wait until you have a ton of money to invest. Micro-investing apps round up your purchases and automatically invest the difference.

Investing is one of the mainstays of wealth building. Given time and money, you’d be surprised at how much your portfolio can grow when compounding interest is brought into the mix.

Looking to improve your finance this year? This post covers some of the best investment apps to reach your goals.

Best Online Stock Trading Apps

Expensive trading commissions and fees put a dent in your returns, which is why the online brokerage platforms on this list have low or zero commissions for most trades and make this list of the best investment apps.

1. E*TRADE

E*TRADE was founded in 1982 and has grown to become one of the best online trading platforms in the U.S. It is listed on NASDAQ and trades under the ticker symbol “ETFC.”

Investors can trade stocks and ETFs on the platform for free and pay a minimal fee of $0.50 to $0.65 per options contract.

If you prefer traditional mutual funds, they have a selection of more than 4,400 no-load, no-transaction fee mutual funds.

A brokerage account is just one of the options available on E*TRADE. You can also have them manage your investments by investing in one of their Core, Blend, Dedicated, or Fixed Income portfolios.

These personalized managed accounts come with a low advisory fee e.g. 0.30% per year for Core Portfolios and 0.65% to 0.90% per year for Blend Portfolios.

  • Investment types: ETFs, bonds, futures, stocks, mutual funds, Certificate of Deposit (CD)
  • App: Available on Google Play and the App Store
  • Account minimum: $0; $500 for Core Portfolios

Is E*TRADE Safe?

They are regulated by the Financial Industry Regulatory Authority (FINRA) and as a member of the Securities Investor Protection Corporation (SIPC), your account is protected up to $500,000 should E*TRADE become insolvent.

E*TRADE also provides additional SIPC coverage.

2. Robinhood

Robinhood was a pioneer of the zero-commission stock trading movement that has almost become the norm today.

Founded in 2013, Robinhood is one of the most popular trading apps among millennials and active traders. You can trade stocks, ETFs, options and cryptocurrencies and there are no fees to trade these products.

Robinhood also offers Robinhood Gold, an optional paid service that provides access to research reports (on over 1,700 stocks), level II market data, and margin accounts. You pay $5 per 30 days for this service and there is a 5% margin interest rate when your margin trades exceed $1,000.

Recently, Robinhood introduced fractional shares which makes it easy for you to invest in thousands of shares starting with as little as $1. They also offer a cash management account so you earn interest up to 0.30% APY on your uninvested balance.

  • Investment options: Stocks, ETFs, options, cryptocurrencies including Bitcoin, Ethereum, Dogecoin and more
  • App: Available on the App Store and Google Play
  • Account minimum: $0; $2,000 for margin accounts

Is Robinhood Safe?

Robinhood is regulated by the Securities and Exchange Commission (SEC) and it is a member of FINRA.

In addition, your account on the platform is protected by SIPC up to $500,000 for securities and cash, and $250,000 for cash-only claims.

3. Webull

Webull is relatively new on the scene (launched in 2017), but it has quickly become a favorite of active traders.

Webull is very similar to Robinhood in that they both offer free trading for stocks, ETFs, and options (crypto trading will be available in the future). The main difference is that Robinhood has a larger range of investment types and Webull has more impressive active trading features.

Webull is best for active traders who are tech-savvy and who can handle all their trading needs on their own, as there is no brokerage-assistance option. However, there is a 24/7 Live Help Team available for support if needed.

  • Investment options: Stocks, ETFs, and options
  • App: Available on the App Store and Google Play
  • Account minimum: $0

Is Webull Safe?

Despite being only a few years old, Webull has put some strong safety measures in place that should put users at ease.

Apex Clearing handles all the trades and provides insurance with limits up to $37.5 million per customer. Additionally, Webull is registered with the SEC and a member of both FINRA and SIPC, which insures accounts up to $500,000 and $250,000 cash.

Best Robo-Advisor Investment Apps

Don’t be fooled, the term “robo-advisors” does not refer to robots or humanoids taking complete control over your investments. Instead, it refers to online wealth management services that use proprietary software to set up personalized portfolios and rebalance them as required over time.

The best robo-advisors offer their clients much lower management fees compared to what is charged by traditional financial advisors and portfolio managers.

They also make life easier for hands-off investors who are not willing or comfortable with choosing stocks and ETFs, or rebalancing a portfolio when its asset allocations go off target.

Lastly, most robo-advisors utilize a passive investment approach that has been shown to beat active management time after time.

4. Wealthfront

Wealthfront was founded in 2008 and offers one of the lowest management fees in the industry. Using low-cost ETFs, they provide investors with custom portfolios that are designed to suit their risk tolerance.

You pay a low advisory fee of 0.25% per year in addition to the inbuilt ETF management expense ratio (MER) which is anywhere from 0.06% to 0.13%.

  • Types of accounts: Traditional, Roth, SEP, and rollover IRAs, 529 plans, and cash accounts
  • Investment products: ETF portfolios
  • App: Available on Google Play and the App Store
  • Account minimum: $500

Depending on your account balance, your portfolio also enjoys tax-loss harvesting, risk parity, and smart beta services with the aim of lowering your tax bill and improving your long term returns.

Is Wealthfront Safe?

Wealthfront Brokerage LLC is a member of FINRA and SIPC and its advisory service, Wealthfront Advisers LLC is a SEC-regulated investment advisor.

Your account is protected up to $500,000 through SIPC, including up to $250,000 for cash claims.

5. Betterment

Betterment is another well-known robo-advisor founded in 2010. They offer two main investing plans: Digital and Premium.

The Digital plan has a 0.25% annual fee and invests your money in a personalized low-cost ETF portfolio. You get automatic rebalancing, tax-loss harvesting and access to free financial advice.

You can also opt for a Premium account and enjoy all the benefits of the Digital plan plus in-depth financial advice and planning. A Premium account has a 0.40% annual fee.

These fees are in addition to the inbuilt ETF MERs that cost between 0.07% and 0.17%.

Betterment also offer a checking and high-interest savings accounts.

  • Types of accounts: Traditional, Roth, SEP and rollover IRAs; checking and cash reserve accounts
  • Investment products: ETF portfolios
  • App: Available on Google Play and the App Store

Is Betterment Safe?

Betterment is regulated by SEC and is a member of SIPC which protects your securities up to $500,000.

For deposits in their cash reserve account, you are protected by the Federal Deposit Insurance Corporation (FDIC) up to $1 million through their program banks.

One other robo-advisor app worth checking out is Wealthsimple. You can read my Wealthsimple review to learn more.

Best Spare Change Investing Apps

Apps that invest your spare change have grown in popularity as financial institutions trying to make it even easier to invest regardless of your financial situation.

Also referred to as micro-investing apps, these apps round up your purchases and invest the difference.

For example, let us say you purchase a cup of coffee for $2.25. A spare change investment app rounds up your purchase to $3.00 and invest $0.75. It is as simple as that.

If you have extra cash to spare, these apps also allow you to make lump sum deposits or scheduled withdrawals from your checking and savings accounts.

6. Acorns

Acorns is an excellent investing app for beginners and those who struggle to set aside dedicated funds for investment purposes. Launched in 2014, the app has grown to over 7 million users and more than $1.2 billion in assets under management.

Acorns offers two main accounts: Lite and Personal.

The “Lite” investing account costs $1 per month. It invests your spare change and offers opportunities to earn cash back at over 350 retailers.

The “Personal” all-in-one account offers investments plus a no-fee checking account with debit card and retirement IRA investing (also referred to as Acorns Later).

  • Account minimum: $0
  • App: Available on the App Store and Google Play

Is Acorns Safe?

Acorns is registered with SEC as an investment advisor. It is also a member of FINRA and SIPC.

Securities in your account are protected by SIPC up to $500,000 while deposits in your Acorns checking account is insured by FDIC up to $250,000.

Two other spare change apps worth looking at are Qapital and Chime.

Are Investing Apps Worth It?

The best investment apps are convenient and they can also save you money in fees. However, you should carefully review their offerings, investment strategy (such as passive vs. active), customer support, total fees package and more before making a choice.

In general, you should understand your risk tolerance and not invest in assets outside of your comfort zone. Routinely re-assess your portfolio in order to ensure that you remain invested in line with your financial goals.

Unless you absolutely know what you are doing, stay away from day trading. It increases your risk level by a large margin and you can lose a lot of money.

This article highlighted the best investment apps out there that will help you build wealth.

Start investing, think long-term, and watch your wealth grow.

 

 

 

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