Stash Review

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stash

Are you seeking financial freedom? Apps like Stash can help.

Stash is one of the fast-growing personal finance apps in the U.S. It promises to make investing easier and affordable for the citizens.

Hence, they can reach their financial goals and accumulate wealth. Again, it offers a simplified platform for new investors.

How does stash work?

Just like most investment platforms, Stash provides its clients with the essential tools to build wealth for the long term.

1. Join Stash

To join Stash, you have to be a U.S citizen. If you are not, do not border signing up because the user’s IP outside the U.S is blocked.

Unfortunately, Stash is not also available in Canada for now. However, Canadian citizens can invest using other alternatives like Questwealth and Wealthsimple.

To join or sign up:

  • Download the Stash app.

Stash is on Android and iOS devices but not fully accessible through the web.

  • Click on sign up to set up your account.

However, you will need to input your Security Number, Bank Account (a U.S bank) and, U.S Citizenship such as a green card.  Furthermore, you must be at least 18 years of age.

Once you have the details ready, setting it up is easy. What’s more, you earn $5 when you successfully sign up. However, it may take 2 days to have it deposited into your Stash account.

After successfully joining Stash, you will have to answer some questions. This will help them to analyze your answers and know your financial goals.

With that, they will provide services such as budgeting and investing advice tailored to meet your specific needs.

2. Choose a plan

Stash has three major plans: Stash Beginner, Stash Growth and Stash+. Therefore, before you will start investing, you must pick up a plan.

Stash Beginner features

For the newbies in investing, this is a better option. It is cheaper and customized for your basic needs.

  • You pay $1/month

  • Offers investing platform

  • You get a Stock-Back Card. With a Stash Stock-back card, you can make purchases. Earn Stock. Invest them automatically.

  • Banking with Stash gives your money the protection it needs with no hidden charges.

  • Tailored advice just for you

  • Saving tools

  • Stash partners with Avibra to offer you $1k life insurance

stash review

Stash Growth features

Before we begin, Stash growth is best suitable for an average investor.

  • You pay $3/month

  • Enjoy all the features of Stash Beginner

  • Tax benefits for retirement investing

  • Personalized retirement advice

  • Access to Smart Portfolio10

  • Plan and save for Retirement with Roth or Traditional IRA

  • Personalized retirement advice

Stash+ features

This is a premium plan. It offers more exciting features.

  • You pay $9/month

  • Enjoy all the features in Stash Growth

  • You earn bonuses and 2x Stock with the Stock-Back Card

  • Children investment plan

  • Access to top research and advice

  • $10k life insurance offered by Avibra

Make a deposit

Irrespective of the plan you choose, you have to deposit into the new account to start investing.

However, it is up to you to add the money manually or automatically. In addition, you can make a deposit either in parts or whole.

You can even set up your Stash account to receive your paycheck directly.

Create goals

Create your goals and arrange them according to priority. This will help to redistribute your money accordingly.

Stash features many great tools that can help you. Some of them are the tracking, budgeting and saving tools.

You can always track how you spend your money while working towards achieving your goals.

Invest

Stash gives one of the lowest minimum account balances for investment, as low as $5. Therefore, you do not have any excuse to start investing today.

Although they focus on Stocks and ETFs, there are still thousands of them to choose from. You can choose from “Stocks by Industry” such as energy, healthcare, finance companies etc.

Alternatively, you can choose “ETFs by Categories” such as commodities, bonds, broad markets, missions and causes, global exposure etc.

Just browse through the lists of available investments to choose from and start investing outrightly. So you see, you do not have to worry about putting all your eggs in one basket.

It is even more interesting to know that you can invest in fractional shares. That means you can purchase shares based on what amount of dollar you have rather than what a whole share cost.

Again, to earn more stock, make frequent purchases with the Stock-Back card.

Other benefits with Stash investing are:

  • Invest and enjoy unlimited trading with no hidden fees.

  • Automatic investing – Just say it and allow them to invest for you the way you want it.

  • Investment recommendations – Stash may recommend for you suitable investments by analyzing your portfolio.

  • Invest in your future – this includes investment plans for your children and retirement.

 On an important note:

There is no day trading with Stash. It focuses on helping you build long-term investment.  So for all the market transactions, it takes four trading windows per week to execute them.

Other services offered by Stash

Apart from investment, Stash also offers banking services. They promise to help you save your money with no hidden fees like most banks charges.

Stash guarantees you that banking with them will help you:

  • Save your money automatically. There are tools to help you save and invest. Such are “Round-ups” and “auto-invest”.

  • Build your wealth rather than depreciate it with hidden charges and bank overdraft. You also save and invest with no minimum balance.

  • Make budgets by prioritizing your needs. With direct deposit, you can access early payday.

Features of Stash

Simplified interface: This is a plus for Stash. A simple interface makes navigation easier. Users also interact better.

My experience with some similar investing apps is like looking for a green snake in green grass. Their interface makes it hard to find what you are looking for. Sometimes you may not even find them at all.

With Stash, you know where you are going and what to find.

Round-up tool: This is a great feature that helps increase your savings.

Let me explain. When you spend with your Stash debit card, Stash will round up your purchases to the nearest dollar.

Whenever the Round-Ups reach $5, Stash will automatically deposit it into your Stash Invest account. It will reflect on your cash balance. Therefore, you can use it to invest immediately.

For example:

When you spend $29.5, Stash will round up your purchases to $30. It keeps doing this until all the extra round-ups reach $5, and then transfers it to your investment account.

What even makes it more interesting is that you can turn it on or off. To do so:

  • Go to the Stash app

  • Under the Account section

  • Click on it to see Auto-Stash settings

  • Pause the Round-Up

Stash also has an auto-investing feature.

Advantages of Stash

  • Micro-investing

Stash is a Micro-investing app. That means it helps you to invest the small amount of change you have. This is unlike traditional investing that requires much money or investment knowledge.

  • Fractional shares

As aforementioned, you can buy fractional shares of ETFs with the amount you have. There is no need to buy the whole shares if you do not have enough money.

This is another important advantage of a micro-investing app like Stash. Although it will not make you rich, you can save more money.

  • No minimum balance

Some trading platforms like Questrade require a minimum balance of $1000. Others may require more or less.

Stash requires no minimum balance. Hence, you can trade with what you have, even as low as $5.

  • Earn more Stock

You can earn more Stock with the Stock-back card. It enables you to spend, earn, save and invest automatically.

Gas, travel, groceries, and other regular purchases earn you Stock. Nevertheless, gift or money orders, ATM withdrawals and other non-qualifying purchases will not earn you any Stock. Other terms and conditions apply.

There is no need to worry about your earned Stock expiring. Unlike rewards, Stocks never expires.

Note: You get a Stock-Back card at no additional cost to you with any of the Stash plans.

  • Socially Responsible Investing (SRI)

Many investors are conscious of where their money is going and what they are promoting.

For example, many will like to invest in companies that help reduce carbon footprints than in the ones that promote it, like fossil fuels.

SRI encourages companies who are earnestly helping the society and environment to become better.

Stash provides a Socially Responsible Investing option for its users. Investors can comfortably invest in companies of their choice without compromising their values.  

  • Guidance

They allow you to do your thing but not without guiding you. They also make investment suggestions for you. It is up to you to follow it or not.

Their automated guidance may not be comparable to a Robo-advisor or human advice but it is still great. However, the absence of these two advising methods makes it a disadvantage for some investors.

Stash will not help you to pick your investments or manage them for you. However, if you just need guidance selecting investment, then, this will do.

Other advantages include having an investment plan for children through a Custodial account. Nonetheless, you only have an access to it with their premium plan (Stash+).

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Disadvantages of Stash

  • High management fees

The cost is one of the biggest drawbacks of Stash. Many think they pay excessively much for an app with no Robo-advisor tool, which means no account management.

Here are some of the fees:

  • You pay monthly from $1 – $9 depending on your chosen plan.

Even more, the $3 per month is not ideal for retirement savers. Many investment platforms waive fees on retirement accounts.

  • You pay a yearly fee of 0.25% if your account balance is over $5000 for new investors.

  • You’ll pay $75 on outgoing transfer fees.

  • You pay a minimum of $15 to open a Roth account.

Although some investors can boldly waive the monthly charges, it is not so with those with a low account balance.

Besides, these fees add up to a huge amount over time and can affect returns. More so, it can lead to a high expense ratio.

  • Poor tax strategy

The only good thing about “Stash and Tax” is that they will provide you with some educational materials.

They believe it will help beginners to understand more about tax. That is just it. They offer no other good strategy that can help prevent or at least reduce tax-loss harvesting.

Since you are on your own, you may not know how to identify investments that have lost value. Even more, how then will you know how to use it to offset taxes on capital gains?

For many new investors, this may lead to loss.

How safe is Stash?

Stash is safe and legit.

When it comes to cash management and investment like this, what comes to the mind of every investor is the Security level.

A poor security level can lead to great loss (money and information) and make the investors vulnerable. However, I bet institutions offering financial services should know better.

Stash does offer cutting-edge security features such as:

  • Continuous fraud monitoring

To help detect suspicious transactions, Visa monitors your debit card activities.

  • Debit card security

Perhaps you lose or misplace your debit card. You can temporarily lock it from your Stash app and unlock it afterwards.

More so, the card can help reduce fraud and secure your purchases with the EMV chip and 3-digit security code it possesses.

Other security features are:

  • Zero liability policy

  • Transport Layer Security (TLS)

  • Biometric recognition

  • 256-bit encryption

  • Access control

  • Bug Bounty Program etc.

Furthermore, Stash is registered with the US Securities and Exchange Commission (SEC), as an investment advisor.

Being a member of the SEC helps them to follow the Federal regulations to give your investment the best protection it needs.

It also offers FDIC-insured bank accounts through Green Dot Bank. So you see, your accounts get the maximum protection it needs against bank failure or theft.

Therefore, your money, transaction and data are secured and safe.

Bottom line

Do you need an investing platform to invest your spare change? Stash is the right place for you.

It is more like a stepping-stone for new investors, where you slowly build your way to wealth.

Thanks for reading, please let me know your thoughts and comments below. 

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