Iâve gotÂten a few verÂsions of the quesÂtion âIs Stash legitÂiÂmate?â via email from readÂers. I thought Iâd share my answer more genÂerÂalÂly.
Since I wrote the iniÂtial post below, Stockpile has pubÂlished a relÂeÂvant post: What Happens to my investÂments if someÂthing hapÂpens to Stockpile?
Stash investment options
What you buy from Stash are either ETFs (Exchange Traded Funds) or Stocks. When you buy them, Apex Clearing acts as the broÂkerÂage.
This is a pretÂty typÂiÂcal arrangeÂment, though often behind the scenes. Smaller comÂpaÂnies that want to offer serÂvices canât afford (for reaÂsons that often donât involve only monÂey) to build their own. They look to a serÂvice provider that either conÂnects âon the back endâ or for which they can white label (take and brand as their own).
Apex Clearing is an estabÂlished comÂpaÂny and âback endâ for a numÂber of firms that offer broÂkerÂage serÂvices like tradÂing and clearÂing. Think of them as a broÂkerÂage platÂform for othÂer broÂkerÂages (or innoÂvÂaÂtive investÂing apps like Stash Invest).
In short, were anyÂthing to hapÂpen to Stash youâd still own your investÂments. The investÂments you hold are not in any way depenÂdent upon Stash Investâs surÂvival as a going conÂcern.
Stash Invest as a going concern
That said, itâs nice to know youâre investÂing with a comÂpaÂny that will surÂvive.
Iâve spoÂken recentÂly to the Stash Invest CEO myself. We had a brief, but enerÂgetic conÂverÂsaÂtion. We both believe in the imporÂtance of getÂting peoÂple to save more, to build long-term wealth. Heâs comÂmitÂted to Stash and brings a lot of relÂeÂvant expeÂriÂence to creÂatÂing a sucÂcess.
The idea that most American famÂiÂlies couldnât surÂvive even a minor finanÂcial disÂrupÂtion creÂates an urgency for what weâre each doing (Stash Invest with their app, and me with my book & finanÂcial eduÂcaÂtion activÂiÂties).
Stash is well fundÂed, genÂerÂates revÂenues from their cusÂtomers, and, if my web anaÂlytÂics are any meaÂsure, growÂing in popÂuÂlarÂiÂty.
Stashâs approach
I have about $250 investÂed with Stash. Mostly because as a âfeelÂerâ I need to use someÂthing in order to absorb what itâs about. I have a simÂiÂlar amount investÂed in the Robinhood App for a simÂiÂlar reaÂson.
The most unique thing about Stash is the way it comÂmuÂniÂcates the investÂment opporÂtuÂniÂties.
I often joke that traÂdiÂtionÂal finanÂcial comÂpaÂnies are like Americans travÂelÂing overÂseas. When Americans conÂfront non-English speakÂers, they simÂply talk slowÂer and loudÂer as if slowÂer-and-loudÂer magÂiÂcalÂly makes English (or investÂing) underÂstandÂable.
Stash comÂmuÂniÂcates the valÂue of an investÂment difÂferÂentÂly, thereÂby helpÂing peoÂple relate more to the thing theyâre investÂing in. Since Stashers are focused on long-term investÂing (wealth buildÂing), not tradÂing, itâs ok to build a relaÂtionÂship with an investÂment. That relaÂtionÂship will ensure that peoÂple stick to their finanÂcial goals over a longer periÂod of time.
For examÂple, Iâve investÂed in âDelicious Dividendsâ and âRoll with Buffettâ. If you were to invest in Delicious Dividends at a regÂuÂlar broÂkerÂage youâd have to buy a Schwab fund called âUS Dividend Equity ETFâ.
Which is easÂiÂer to relate to âdeliÂcious divÂiÂdendsâ or âUS Dividend Equity ETFâ?
This is exactÂly why Stash is going to be sucÂcessÂful. Thereâs a huge gap in curÂrent finanÂcial offerÂings and peopleâs comÂfort investÂing. Todayâs finanÂcial prodÂuct sellÂers expect cusÂtomers to bridge that gap, whereÂas Stash bridges the gap for cusÂtomers by makÂing the investÂments themÂselves more accesÂsiÂble with simÂpler, more relatÂable lanÂguage.
This is great for Stashers, because theyâre not buyÂing some proÂpriÂetary (and risky) investÂment prodÂuct. Stashers are buyÂing the same prodÂucts that anyÂone else buys, theyâre just expeÂriÂencÂing those prodÂucts through difÂferÂent lanÂguage.
Getting started with Stash
Stash will give you $5 to get startÂed so you can explore the app yourÂself. I recÂomÂmend setÂting auto-stash too â auto-stash allows you to autoÂmatÂiÂcalÂly set aside a litÂtle monÂey on a regÂuÂlar schedÂule.
I have auto-stash set to invest $20 a month in Delicious Dividends. In keepÂing with my Elephantâs Paycheck metÂrics, investÂing $20 a month in Delicious Dividends increasÂes the payÂcheck I receive from my portÂfoÂlio.
Not only am I buildÂing wealth for my familyâs future by putting away a litÂtle bit each month, I get a raise each and every month I stick with my plan.
What are you waitÂing for? Letâs get startÂed.
If you preÂfer to buy indiÂvidÂual stocks (like Tesla, Apple, Snap and more), hereâs $5 to get startÂed with Stockpile. You can start with just $10. Read my Stockpile review first if you like.
If youâre still on the fence, sign up for my free course to learn more about divÂiÂdend investÂing, speÂcifÂic steps to get startÂed and own your first shares, and a free temÂplate with instrucÂtions to track your investÂments. Just enter your email below:
Disclosure: The links in this post are affilÂiÂate links. That means if you decide to invest with Stash I get paid. My integriÂty is worth more than any affilÂiÂate payÂment â I recÂomÂmend Stash because itâs comÂmendÂable not because itâs comÂmisÂsionÂable.
From a review on it (http://anappreview.com/stash-invest-app-review/) it seems pretÂty legitÂiÂmate to me. The fees are quite high (espeÂcialÂly when comÂpared to Robinhood which offers zero fees), but its knowlÂedge base is quite good.
Hi Roi,
Robinhood is amazÂing, but has a difÂferÂent tarÂget marÂket. If we think about three simÂple types⊠there are traders, investors, and peoÂple who donât yet invest but want to. Robinhood is best for traders. Stash best for peoÂple who donât yet invest, but want to (because they focus on eduÂcaÂtion, plain lanÂguage, and othÂer tools like auto-stash that help the beginÂner develÂop a good habit).
For that midÂdle type, investors, it depends. Robinhood is someÂthing I would use over Stash because I like buyÂing indiÂvidÂual stocks. However, I love love love how Stash allows me to invest by dolÂlar amount instead of a numÂber of shares⊠it allows me, for examÂple, to buy $20 of a fund/ETF instead of 2 shares of someÂthing. I also like how Stash allows me to setÂup Auto-Stash, investÂing autoÂmatÂiÂcalÂly, because it helps develÂop good habits. Again, not every investor needs that (I donât)⊠but itâs realÂly valuÂable if you donât have the interest/discipline to invest regÂuÂlarÂly.
db
I missed the part where you tell how Stash is comÂpenÂsatÂed
Iâm sorÂry Horace, I thought I had linked to my origÂiÂnal review of Stash, where I menÂtioned the fees they charge:
$1/month, or 0.25% of balÂance annuÂalÂly (charged monthÂly, calÂcuÂlatÂed daiÂly) for balÂances over $5,000 (at $5,000 thatâs just over $1/month).
You can find my origÂiÂnal review here:
http://elephantspaycheck.com/stash-review/
David
Thanks for the review and info. I just heard about Stash today and was curiÂous about it so, did a Google search and boom here you was. I am going to wait a litÂtle before signÂing up as I have some stuff going on right now that requires a bit more of my time and attenÂtion but, will being getÂting there very soon. Thanks again for your artiÂcle.
how do you put the savings/profit from this in a ROTH IRA?e m barÂber
Hi â You would have to transÂfer the monÂey out of Stash and then into your Roth IRA account. I donât believe that Stash has accounts that are ROTH qualÂiÂfied. If you transÂfer monÂey out of Stash there wonât be a fee. If you try to transÂfer funds/ETFs there would be. Of course, as soon as you sell someÂthing, if thereâs a profÂit there might be tax owed, so youâd have to conÂsult a tax adviÂsor on the impliÂcaÂtions.
Good luck!
db
This app is a rip off and is no betÂter than going through a broÂkerÂage firm. The fees are not explained and treats the user is if they are an expeÂriÂenced investor when the tarÂget audiÂence of the app is the new investors that need tips and warnÂings as they stumÂble through the investÂing process. This app doesÂnât proÂvide that, instead it takes fees from the uninÂformed investor with no remorse.
-ex series 63 & 7 holdÂer thatâs glad I only gave away 25 dolÂlars to these develÂopÂers
Hi Ivy,
Iâm curiÂous if you have some speÂcifÂic examÂplesâŠ
I found the fees to be quite clear ($1/month up to a cerÂtain limÂit, a perÂcentÂage of total investÂed afterÂwards â I donât have the details in front of me). Itâs one month free.
Also, to give away $25 âto these develÂopÂersâ youâd have to be using them for over two years. Otherwise, you can just sell whatÂevÂer youâve bought and transÂfer the monÂey out. So, not sure what you mean.
You can go through a broÂkerÂage to buy many of the same things, but I feel the oppoÂsite of you â Stash explains things more clearÂly, with âhuman namesâ for the ETFs. This helps beginÂner investors â they make very clear what the underÂlyÂing secuÂriÂty is. For examÂple, âroll with Buffettâ is clear that youâre someÂhow investÂing like Warren Buffett. And, while you could buy Berkshire stock directÂly youâd have to do so in round lots. And, you could buy the ETF/Fund to avoid round lots (it tells you what it is in the Overview) youâd still be payÂing a transÂacÂtionÂal comÂmisÂsion of more than one dolÂlar. You would pay more to purÂchase these through a broÂkerÂage, and probÂaÂbly wouldÂnât have easy feaÂtures like regÂuÂlar monthÂly investÂments, to help build wealth over time.
David
I will like to start but it only gives me one option on my bank account and like to use savÂings instead of checkÂing thank u
Hi Miguel
I sugÂgest you reach out to Stockpile supÂport. In the app, if you select âhelpâ you can call or email supÂport.
David
Hi! First time readÂer here. Thanks for the synÂopÂsis and for helpÂing the readÂer disÂtinÂguish between buyÂing shares whole and investÂing set dolÂlar amts for ETFs. Gets me excitÂed to start!