Stash Invest Review - Should You Trust This Investing App? (2024)

About Stash Invest

Stash Invest is a micro-investing platform that enables beginners to create and manage their investment portfolios comprised of selective stocks and exchange-traded-funds (ETFs). The app was developed to simplify and introduce beginners to the world of investing in the stock markets through fractional shares of theme-based ETFs with as little as $5.

Users can schedule and automate deposits and investment purchases to maintain consistency and optimize compounding. Stash also provides personalized guidance and recommendations, so users can learn as they earn. Continue reading our Stash Invest review to see if this is the right investing platform for you.

History

Stash was launched in 2015, out of New York by CEO Brandon Krieg. The goal was to create a simple gateway application to educate and onboard new investors to the financial markets. With a simplified dashboard and easy-to-use menu options that guide users through the sign-up process into their first investment portfolio with tiny bite-sized investments as low as $5. Stash enables a low barrier to entry in the world of stock market investing. The app has surged to over one-million accounts with the average account size around $316.

How it Works

Beginners and small investors can select from over 40 thematic ETFs and individual stocks for their portfolios. Onboarding is relatively easy as the Stash platform guides you step-by-step. Users answer a series of financial questions pertaining to income, net worth, type of investor and banking information as well as authentication processes. Stash creates an investor profile based on user responses and suggests pre-built portfolios that best fit the risk profiles (conservative, moderate or aggressive).

At any point, users can decide to forgo recommendations and select more or less aggressive portfolios or even create their own portfolios comprised of the supplied stocks and ETFs. Fractional shares enable micro-investing in any of the ETFs and stocks. Users can track performance and adjust their portfolios easily and conveniently through the mobile app.

Account Requirements

The minimum starting balance is $5. However, it’s prudent to start with at least $500 since the monthly fee of $1 will cost $12 a year. That would be paying 12-percent in fees on a $100 balance compared to 0.024-percent on a $500 balance, especially when factoring in a hypothetical 5-percent annual gain. Stash is available to U.S. residents at least 18-years of age. However, Stash Custodial enables parents and guardians to maintain and manage an account for children under 18-years.

Stash Invest Pricing and Fees

Stash Invest offers three different pricing plans. Unlike other comparable services, Stash doesn’t charge a management fee based on the size of a portfolio. Instead, the company offers three flat-rate pricing plans that each have unique features.

Stash Beginner is $1/month and covers the basics. This account provides access to Stash’s investment tools such as portfolios and fractional stock shares. This account level also comes with access to a debit account.

Stash Growth is $3/monthand comes with the added benefit of retirement investing. The main difference here is the account type. Whereas Stash Beginner only offers taxable brokerage accounts, Stash Growth offers IRA’s.

Stash+ is $9/month and offers all of the benefits of the previous two plans plus a few other unique features. Stash+ clients can add custodial investment accounts for up to 2 kids. These clients will also get access to Stash’s metal debit card that offers 2x Stock-Back™ rewards.

Indirect Fees

There are indirect fees associated with the underlying asset classes. Since most of the investments are in ETFs, investors pay the annual fees on those which are range from 0.07% to 0.95%. The average ETF fee is around 0.39%.

Stash Invest Platform and Apps

Stash operates via desktop and mobile devices using iOS and Android. The dashboard was designed to be as self-explanatory and intuitive as possible to ensure a frictionless onboarding and transactional experience. The features are crafted to emphasize education with a long-term mindset. Transaction are performed through the app.

Investing Tools

While most robo-advisors are thin on investing tools, Stash has more depth in terms of education catering to beginners and small accounts with a hands-on learn as you earn approach. There is much emphasis on exercising patience with a long-term outlook imbedded into the tools. For example, Stash illustrates the account balance in monthly graphs rather than daily or even intra-day to reinforce long-term planning. Auto-Stash lets you automate purchases into which ETFs, amounts to buy and when. The Stash calculator lets you visualize the compounding returns to expect on an annualized 5% performance based on investment amounts.

Stash Coach

As an educational tool, this program lets users complete investing challenges to earn points and rankings as users gain more experience and knowledge. Asset allocation, risk and portfolio management are some of the skill sets users will improve with continue engagement.

Stash Learn

Stash has an exclusive online magazine that provides entertaining and educational content and news for investors. I like how each article is accompanied with a total read time annotation (IE: “3 min read”) to help users micro-schedule reading sessions.

Portfolios

Stash has three general types of portfolios-based risk profiles (conservative, moderate and aggressive) composed of over 30-thematic ETFs. While Stash colorfully labels the ETFs and provides clear descriptions, most of these are already existing Vanguard ETFs or stocks. For example, the “Roll with Buffet” investment is fractional shares in Berkshire Hathaway Inc. Class B shares (NYSE: BRK.B).

Stash also has a feature called “Smart Portfolio” that creates a personalized portfolio based on a few key factors. This portfolio is automatically managed and offers rebalancing as well as fractional shares.

Performance

Since all the investments are long-only positions, they tend to performance with the macro U.S benchmarks like the S&P 500. Naturally, the selection, allocation, timing of entry and average cost of shares is the differentiating factor which differs by investor. There are no direct hedging options other than boosting allocations in fixed-income ETFs or cash.

Performance will vary based on what type of portfolio you have and when you start investing. The market has been strong for the past 10 years, so most portfolios performed well.

How Does Stash Compare?

Like competitor Acorns, Stash recently rolled out Stash-Save which automatically assigns spare change to your account. Stock-Back Rewards is a program where Stash debit card purchases get rewards in the form of fractional shares. Stash provides users more control and flexibility in managing their accounts than the usual robo-advisor apps, which tend to be more automated and narrowly structured.

Here are some in-depth guides comparing Stash to other popular brokers and robo-advisors:

• Stash vs. Robinhood
• Stash vs. Acorns
• Stash vs. M1 Finance

Stash Invest Key Differentiators

Stash provides a more hands-on experience for users compared to other robo-advisors. Providing a larger selection of investments including over 40-thematic ETFs and individual stocks, this flexibility also places more risk and responsibility over to the investor. Unlike traditional robo-advisors, Stash doesn’t provide automated portfolio rebalancing or tax-loss harvesting features. The emphasis on educational content in app and online, makes it top choice for beginners.

Trustworthiness

Stash is a registered investment advisor regulated by the SEC and a member of FINRA. Investor accounts are protected under SIPC. Stash implements 256-bit encryption and doesn’t store bank login information.

Who is Stash Invest Best Suited For?

Stash is designed specifically for beginner-level investors with small-accounts as a gateway provider to the world of investing. Tech-savvy Millennials with a desire to learn while they earn are best suited for this app. Since trades are not executed in real-time, traders will not find this platform useful for anything other than long-term passive investing.

Stash is ideal for investors who want to take a “set and forget” approach to investing (and are willing to pay a small subscription fee for it). With Stash, you can create a personalized portfolio, make deposits, and leave the rest up to Stash.

If you want more control over your portfolio (or want to avoid a monthly fee), robo-advisors like M1 Finance may be more suitable for you.

Pros

• Flexible hands-on investment structure for users
• Focused on education learn-as-you-earn approach
• Over 40-thematic ETFs and selective individual stocks for fractional share investments
• Fast on-boarding and easy-to-use app for beginners
• Automated funding and investment scheduler for users
• Stock-Back Rewards applies fractional share rebates with debit card purchases

Cons

• No automatic portfolio-rebalancing or tax harvesting features
• No real-time executions