Why is Robinhood under fire, and why are Robinhood competitors taking the reins? Due to server problems, several crypto traders were unable to make trades during some very important trading moments. This caused many Robinhood users to become frustrated and lose faith in the platform.
Members of the r/WallStreetBets Reddit group sent the Gamestop stock price soaring, which made headlines earlier this year. Gamestop and other growing stops were briefly stopped by Robinhood, TD Ameritrade, and Webull, causing a huge user backlash.
There was quite a commotion on the internet, and this Gamestop issue even made international news. Now, you might be wondering if you should switch your Robinhood holdings and look at other investing apps. More and more people are going against Robinhood, so this thought is not uncommon.
Lucky for all of us, both hands-on and passive investors have plenty of options, some particularly good for newbie investors. Continue reading this post to find out which new app is right for you! [full disclosure: I’m a fan of Robinhood and continue to have an account. I also have accounts with a number of the recommended vendors below].
1. Charles Schwab offers many investing and wealth-building products.
Self-directed brokerage accounts, investment accounts, IRAs, and insurance accounts are among Schwab’s investment offerings. You can even open a brokerage account without having to fulfill a minimum balance requirement.
Plus, Schwab provides commission-free stock, ETF, and options trading for its users. Mutual savings, money market funds, bonds, fractional shares, international stocks, annuities, and other assets are available via the Charles Schwab app.
Schwab investment app also has automated investing for more hand-off investors. Overall, their app is a strong contender against Robinhood.
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2. Fidelity can consolidate active trading accounts and automated accounts in one app.
If you choose to do so, you can regularly trade as well as use Fidelity Go, Fidelity’s digital investment platform. Fidelity, like Charles Schwab, allows users to trade stocks and ETFs without paying commissions.
Fidelity offers fractional share trading, but the prices for the automated advice you can get varies. To start with Fidelity Go, you don’t need a specific account size. However, if your balance is between $10,000 and $49,999, you’ll have to pay $3 per month.
$50,000 or more in your account and you are charged a 0.35% annual asset-based tax. When you have less than $10,000, you won’t have to pay anything. It’s a solid choice in a group of Robinhood competitors.
3. Acorns can handle the entire investment process for you.
To start investing with Acorns, you’ll need a minimum of $5 and pay a monthly fee of $1, $3, or $5, depending on the package that you want. Round-Ups, one of Acorns’ unique offerings, allows people to invest any extra change you have left over from transactions.
To start, simply link your debit or credit card, and Acorns will round up your payments to the nearest dollar and spend the difference.
You can choose from Acorns LIte, Acorns Personal, and Acorns Family packages. Acorns Lite is a monthly subscription service that provides access to an investment account for $1. You will have an investment account, an IRA, and a checking account with Acorns Personal, which costs $3 per month.
Acorns Family gives you access to an investment account, retirement account, checking account, and custodial investment account for the children in your family for 5$ per month.
4. Betterment can automate your investments and retirement savings.
Betterment is another of Robinhood’s competitors and a forerunner in the industry of digital investment platforms. Many Robo-advisors may have recommended this app to you.
This investing app allows you to start investing without having to fulfill a minimum account size threshold.
If you use the company’s digital plan, you’ll have to pay a small 0.25% annual fee. Betterment’s premium plan gives you unrestricted access to certified financial planners (CFPs), but you’ll need at least $100,000 in your account to qualify.
5. Ellevest is perfect for goal-focused investors.
Ellevest is a female-focused automated investing platform with automated account management, learning tools, and coaching services. Yes, this investing app doesn’t provide self-directed trading, but it has various financial tools and services.
This app also has Ellevest Spend and Save accounts, customized monitoring for traditional accounts, SEP, and Roth IRAs, and affordable one-on-one consultations with financial advisors and job mentors. You also get unrestricted access to online learning resources, including seminars and email courses for users.
6. SoFi is designed for beginner investors.
SoFi’s trading options are limited to stocks and exchange-traded funds (ETFs), but this investment platform makes up for it with its fee-free offers. SoFi gives its users a no-fee digital investment portfolio, but you’ll need at least $1 to begin investing.
Individual and shared brokerage accounts, standard IRAs, Roth IRAs, and SEP IRAs are all accepted by SoFi. Cryptocurrency trades are one of the more expensive aspects of SoFi’s aggressive trading portfolio. All cryptocurrency transfers at SoFi are subject to a $1.25 fee.
7. E*TRADE gives you access to thousands of fee-free mutual funds.
E*Trade provides commission-free trading on stocks, options, and ETFs listed in the United States. IRAs and school savings plans are among the accounts offered by this investment platform.
E*Trade has over 9,000 mutual funds to choose from, so you can invest in pretty much anything that you can afford. There are over 4,400 no-transaction fee mutual funds among those options. You’ll need at least $500 to start, but the company also offers automated investment advice and controlled portfolios, so it’s worth it.
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Investment apps are excellent platforms for saving but don’t be fooled by their sleek designs. Use these apps wisely. It is vital for your financial success to educate yourself before investing through the apps.
Be mindful that investing entails some risk, and there’s always a chance of losing the money you’ve put in. Because everyone’s risk profile is different, you must understand how much money you can afford to invest.
You’ll also want to brush up on your investment basics. Understand the distinctions between stocks, bonds, index funds, and mutual funds.
That said, the Robinhood competitors above make it possible for us ordinary folk to dip our toes in the ocean of investment. Take these opportunities to make some passive income as long as you can afford it and know what you’re getting into.