You can’t deny the fact that investing is a complex task, and you need to have the essential skills to do that. However, despite all this tough talk, the market is still filled with plenty of people trying their luck at the stock markets, hoping to make a fortune from stocks. In this guide, we will discuss some of the best investment apps that you can use to invest your money and make smart financial decisions.
Table of Contents
Best Apps For Investing Reddit
Who uses Robinhood?
The app is popular among young, first-time investors, as evidenced by its game-like interface, including celebratory animations and push notifications when there are updates in the market.
It’s not limited to only Redditors taking on risky investment moves. If you do some proper research, Robinhood can, at the very least, serve as a good introduction to investing. But no matter how savvy you are at picking stocks, you’re highly unlikely to beat the market over the long term. (Which is why Money has always advised new investors to start with passively-managed index funds with proven track records instead.)
The truth is, there’s no crystal ball predicting where the stock market will go next. Just look at what’s happened over the last year: The stock market crashed when COVID-19 hit the U.S. in March of 2020. But by August of 2021, the S&P 500 — a benchmark commonly used to measure the broader stock market — was up 100% compared to its pandemic low on March 23, 2020. And despite some turbulence here and there, like a dip attributed to investors’ concerns about the high debt levels of one of China’s largest real estate developers, stocks keep soaring to record highs. In October, the S&P 500 and the Nasdaq experienced their best monthly performances since last November. Still, market experts say a market correction (generally considered a dip of 10% to 20% in stock prices) will likely be here before long.
Day traders will always try to game the system — even if it’s usually next to impossible to make boatloads of cash that way. And since Robinhood lets anybody with a bank account buy and sell risky financial products, its appeal is no surprise.
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How to invest with Robinhood (the right way)
Before you download any sort of investing app, figure out what your motivation is, Falcone suggests. Are you doing this to make some quick cash? Because you have Reddit-induced FOMO? Or because you want to put your money to work responsibly, and are prepared to think about long-term strategies?
“That should help you put blinders on to what you might be seeing on social media or hearing from your friends,” Falcone says. “If [certain] types of stock don’t fit into your strategy, then you should immediately know to ignore those suggestions.”
If you’re approaching this through a financial planning lens, make sure you’ve already paid off all your credit card and high-rate consumer debt. You should also be contributing enough to your employer-sponsored plan to maximize any potential match benefit — that’s an immediate, guaranteed return on your investment that you can’t expect from the stock market.
“Once you are on track for retirement and have additional cash to invest, you may want to consider adding some individual stocks to your portfolio,” Falcone says. “However, it is recommended to secure your financial future with diversified securities first … either through your employer’s plan or an IRA.”
You’ll also want to set some investing goals before you start trading, Falcone says. Maybe you want to invest to help pay for a new couch, a trip to the Bahamas, an engagement ring, or a downpayment on a future home.
“Determine how much that goal will cost, how long of a time horizon you have to achieve it, how much money you have to invest toward it today, and how much you’ll have to contribute on a weekly or monthly basis to reach that goal using a reasonable expected return for your time horizon,” Falcone says.
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How to start investing with Robinhood
Investing through Robinhood is as easy as opening an account. All you need is to be 18 years or older, have a valid Social Security number, and a U.S. address.
If you’re new to investing, start with a small amount of money you’re OK with losing, and stick to stocks and ETFs.
Falcone suggests creating a diversified portfolio with at least fifteen stocks across different industries and company sizes that you’ve already done your due diligence on. Thanks to fractional shares, you can start investing with just a few dollars.
As you dip your toe in, Falcone suggests getting familiar with investing news sites (like Money.com!) and timely content from verified financial planners like herself. Morningstar.com is another good resource for staying up to date on fund performance, investment strategy, and fees.
You can also use a stock market simulator to create a “practice portfolio”, which will help you learn how the market fluctuates over time, and how to make healthy investing habits (like not checking your account a million times a day).
In other words: Learn to walk before you run, and take the time to understand what you’re actually buying and selling.
Best investing apps for beginners
Stockpile – Best app for gifting stocks
Stockpile is a neat app because it allows you to buy fractional shares of companies. So if you don’t have $300 to buy that one expensive tech stock, you can buy a half or a third of it, instead. Stockpile does not charge any trading fees.
The other neat thing about Stockpile is that it allows you to give a gift card that’s redeemable for stock, so it may be a way to get a younger relative into investing in a fun way. You don’t even need an account to send a gift. Stockpile allows kids to track their investments at any time, and you can set a list of approved stocks for them to trade. The app lets kids share a wish list of stocks with family and friends.
Reasons to get this app: You like investing but don’t have enough to buy high-priced stock and you like the idea of gifting stock to younger relatives.
Fidelity Investments – Best app for managing money all-in-one
If you wanted to live your whole financial life on Fidelity Investments, you could do it with little issue – and have the top integrated experience. At Fidelity, you can get an investment account, a checking account, an IRA, a business retirement account such as a SEP IRA, bill paying, a savings account, a robo-advisor account and even credit card accounts, to cover the big ones.
You can get all your finances in order with one company on one dashboard, and never feel like you’re missing a thing. You’ll get solid research on ETFs and mutual funds, tons of articles on budgeting, investing and personal finance and webinars, too. Plus, if you never need help, you’ll be connected with a courteous and helpful Fidelity rep in short order.
Reasons to get this app: You want all your financial accounts under one roof, and you enjoy being treated like a valuable customer.
Minimum balance required: $0
Robinhood – Best app for active trading
Robinhood is the app to have if you like a smooth interface and avoiding trading commissions, whether you’re trading stocks, ETFs, options or cryptocurrency. You’ll get to do it all with no commission and using a slick mobile interface that makes smooth work of it all. The stripped-down app is simple to navigate, and after a while you’ll move intuitively from screen to screen as you trade the market.
You can access a stock’s page from a search bar at the top of the screen and then pull up charts and vital statistics. Also useful is a feed that aggregates stories from news and investing sites, so that you keep on top of what’s going on. After you’ve decided what you want to trade and enter the number of shares to buy or sell, swipe up and the order is on its way. (Here’s Bankrate’s full review.)
Reasons to get this app: You like trading stocks (as well as ETFs, options and cryptocurrency) for free and having a simple way to quickly do so.
Minimum balance required: $0
Fees: No commissions for stock, ETF, options or crypto trades
Charles Schwab – Best app for beginners
Charles Schwab does well for experts, but it’s also a great app for beginners, because of all the resources it provides. Schwab provides tons of research and education, helping newer investors get up to speed on topics such as investing and personal finance. It also offers fractional shares, meaning you can invest all your money into your stocks, rather than have idle investment money sitting around. And of course, you’ll get commission-free stock and ETF trades.
Schwab is also great for mutual fund investors, with more than 4,000 no-transaction fee funds, one of the largest selections in the industry. You’ll also get highly responsive customer service that gets your questions answered quickly. As if that weren’t enough, you’ll get one of the best sign-on promotions around, with a cash bonus that starts with just a $25,000 deposit.
Reasons to get this app: You like investing with a friendly company that starts off in the right direction and then helps you along the way.
Minimum balance required: $0
Ellevest – Best app for socially responsible investing
Ellevest is one of the top-ranked robo-advisors, but it’s also the top app for socially responsible investing. Ellevest’s mission is to help women investors make smart investing decisions (though, of course, anyone can become a client). It does so by creating investment portfolios and plans that take into account the differing circumstances of women, such as lower lifetime earnings.
Ellevest allows clients to build portfolios that incorporate up to 53 percent of their portfolio in ESG or social impact funds – what it calls its Impact portfolio. These funds invest in companies that have more women leaders, that support affordable housing and community services, and that have higher standards for sustainability. The Impact portfolio costs only modestly more than Ellevest’s low-cost core portfolio, just $13-$19 per year on average for every $10,000 invested.
Reasons to get this app: You want a socially responsible portfolio that can offer attractive returns and also makes it easy for you to invest.
Minimum balance required: $0
Fees: $1, $5, or $9 a month (or discounted annually)
What to consider when choosing an investment app
When it comes to investment apps, think about how you’ll plan to use them. Do you need an educational tool or are you looking to actually trade and invest? Some apps charge fees that can eat into your investment returns, while others have very low costs and offer commission-free trading. If you’re interested in trading things like cryptocurrencies, you’ll want to make sure that’s a feature offered by the app or broker – not all brokers offer crypto trading.
How much money should I plan to invest?
The good news for investors starting out today is that it requires very little money to get started. Fees are so low or even non-existent that you can start with virtually any amount of money. In fact, what you start with matters much less than your saving and investing discipline over time.
The key to achieving ongoing investing success is to add money regularly over time. So you’ll want to add cash to the account and keep investing in your positions regularly over time in order to build wealth.
How much you actually invest depends on your own financial situation and needs. And today’s low-fee brokerages and apps leave more money in your pocket to actually invest.
Are some apps better for investing than others?
Some apps provide special features or focus more on education, while others focus largely on executing trades. For example, Wealthbase is a great app for playing stock market games, but it won’t execute trades for you. In contrast, Wealthfront and Betterment will both invest your money for you, so you don’t have to do much but deposit money in your account.
And those apps differ from brokerage apps such as Robinhood, Charles Schwab and Fidelity Investments, where you need to know what you want to buy. These brokers also allow you to buy different securities, such as stocks, bonds, mutual funds and more. Robinhood and Invstr allow you to buy cryptocurrency commission-free, too.
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