Stash Review: Can Investing Really Be This Simple?

To the uninitiated, the words and jargon used to talk about investing can seem foreign and frightening. If you don’t even know where to begin, how can you start to have your money work for you? Stash aims to take the guesswork and stress out of investing your money. It’s available to people who might not have much to invest and to people who might not know what to invest in, but who know what they believe in.

Ready to learn more? Our Stash review covers the ins and outs of the app and can help you decide if the Stash app is right for you.

What is Stash?

What is Stash Invest? It’s an app that wants to make investing easy for beginners. Instead of telling you where to invest or showing you a bunch of options and hoping you can figure things out yourself, Stash puts things into a language you can understand.

The investing app offers a range of exchange-traded funds. Each of the funds available has a name that makes it crystal clear what’s inside. For example, someone who’s interested in supporting equality for all might invest in the “Equality Works” ETF, which has shares of Yelp, Yahoo! and other companies that have made gender equality and inclusivity an essential part of their mission.

image via: Stash

How Does Stash Work?

Stash investing works to simplify the investing process. When you open an account with Stash, you’re not signing on with a company that’s going to manage your investments. What you’re getting is an investment advisor that is registered with the SEC, and that has gone of its way to make investing more accessible to all.

When you work with Stash, you are investing in exchange-traded funds (ETFs). ETFs are kind of like mutual funds that act like stocks. They track an index but are usually passively managed. You can also buy and sell ETFs on an exchange like you would stocks.

That’s about as technical as we’re going to get, since if you’re interested in Stash reviews, it’s very likely that you haven’t much experience, if any, with investing.

You can open and fund your Stash account with just $5, which all part of the app’s mission to get more people investing. The app allows you to buy fractional shares, meaning you don’t have to pony up the full value of a share to start reaping the rewards of investing.

Investment Themes

Part of the appeal of Stash, especially for newbie investors, is that it divides the funds it offers up into themes. You can choose a fund or funds to invest in based on what matters to you. Sample themes include:

• Do The Right Thing – this fund is focused on companies that have made giving back part of their mission. It includes shares of Apple, Disney, 3M, and Kellogg.
• Wireless Wonders – this fund is focused on telecommunications companies. It includes shares in AT&T, Verizon, T-Mobile, and Sprint.
• Enjoy Yourself – this fund is focused on companies that provide travel or entertainment services. It includes shares in Delta, 21st Century Fox, and CBSCorp.
• Retail Therapy – this fund is all about consumer companies. It includes shares in Netflix, Amazon, and TripAdvisor.

Stash has three broad categories to help you decide which themes are right for you. Those categories include “I believe,” “I like,” and “I want.”

How to Use Stash

To start using Stash, you need first to make an account. The app will ask you for your basic contact information, name and birthday. It then prompts you to choose your investment style. You have three options:

• Conservative – you value stability and are willing to accept lower returns in exchange for reduced risk.
• Moderate – Some losses are OK, as you’re looking for more considerable gains.
• Aggressive – You believe that there’s no reward without a big risk.

The app then asks you for your employment details, including what you do and where you work, as well as your annual income. It then asks you for details about your finances, such as your net worth and whether or not you or anyone you’re related to works in finance or is an elected official.

image via: ​Credit Donkey

Finally, the app asks you for more personal information, including your Social Security number. It needs that information to verify your identity. It uses encryption to protect your personal information.

Once you’ve provided your details, you need to link Stash to a bank account, so that you can transfer money to your new Stash account. After you’ve handed over all that information, Stash will send you a text so that you can download the app on your phone. It’s available for Android and iPhone.

After you’ve created your account, the app will begin recommending investments to you. It usually starts off by recommending that people invest in either a Moderate, Conservative, or Aggressive mix, based on their earlier responses. Then it recommends other thematic investments to help you diversify your portfolio.

How Much Does Stash Cost?

Our Stash review needs to point out that the service isn’t free. How much it costs depends on how much you’ve got to invest. For many users, the investment app will cost $1 per month or $12 per year. Once your account has more than $5,000 in it, the app starts to charge you 0.25 percent per year.

There are no trading fees or commissions involved. The app also gives everyone their first month for free.

Stash: Our Review

Is Stash legit? Can it really be this easy to invest? Well, yes and no. Most Stash invest reviews, ours included, have good things and bad things to say about the product. Let’s start our Stash review with the positive.

What We Liked

Perhaps the best thing about Stash is that it really does open the door to investing to people might otherwise not do it. Having a minimum of $5 and no trading fees or commissions makes investing possible for a greater number of people.

The app also offers relevant and helpful advice, so that you don’t feel like you’re guessing. Its investment guidelines are top-notch and it has plenty of helpful explanations and guidance to help explain investments to you.

Stash invest also makes it super easy to invest in causes that matter to you or in companies you believe in.

What We Didn’t Like

Although our Stash invest review is mostly positive, there were some features of the app that we didn’t like. One of the biggest drawbacks of Stash is the price.

One dollar per month might not seem like a lot. But when you think about how much you might have in your Stash account, it’s actually a pretty hefty percentage. Let’s say you invest $10 per month. Paying $1 per month for the privilege of using Stash means you’re paying 10 percent of your monthly contributions to your advisor. That’s a lot — especially when you consider that the price falls to just 0.25 percent once you hit $5,000.

Stash’s fees aren’t out of the ordinary for the market. The Acorn app, which rounds up purchases and invests the spare change, also charges $1 per month or 0.25 percent for accounts with more than $5,000. There are some options out there, like WiseBanyan, that are completely free.

Another strike against Stash is that it only seems to work on the app. You can sign up through your browser but are then directed to download the app on your phone at the end. Although plenty of people love apps, a fair number of us like the convenience of being able to do things on a browser or desktop device.

The other big drawback about Stash, which you’ll see mentioned in other Stash app reviews, is that it doesn’t offer retirement options. You can’t use it to fund an IRA or another retirement vehicle. The investments you make through Stash are taxable.

Should You Try Stash?

Is Stash invest legit and should you try it? If you’re completely new to investing or don’t have stacks of cash to invest, Stash might be the ideal app for you. It might cost a lot in comparison to the amounts you’re investing, but the guidance you receive from the app can help you avoid making investment mistakes or investing in companies you’re not comfortable with.

One thing that many Stashinvest reviews make a point of mentioning is that the app should be something to consider after you’ve started funding your retirement. Given the tax advantages of a 401(k) or traditional IRA, contributing to one or both might be a better use of your money.

Finally, if you’ve got some investing experience under your belt and understand the difference between mutual funds, ETFs and stocks, you’re not likely to get much from Stash. In that case, you’re better off finding a company that will provide investment guidance and advice for a much lower fee.