Building wealth usually requires regular savings and a disciplined investment approach. Unfortunately, these things are easier said than done.
Thankfully, automated investing apps make it easy for ordinary people to become good investors. They are a great “set it and forget it” option for buy-and-hold investors who are not interested in short-term trading.
Below, we’ve analyzed the top three automated investing apps for 2023, and then we’ve included a few more that didn’t make the list but might be worth considering.
Picking the Top Automated Investing Apps for 2023
After reviewing over 20 top brokers and micro-investment apps, we’ve narrowed down the best automated investment apps to these three.
Acorns is one of the original automated investment apps ever created. These were the first “money” apps that let you round up and invest your change. After that, we also started focusing on investment automation.
Acorns uses your Roundup and automated investments to invest in low-cost index funds for long-term growth. This is a simple “set and forget” approach and is what most people looking for an automated investing app are looking for.
The downside of Acorns is the fees. Unfortunately, Acorns isn’t free and you’ll pay a monthly fee of $3-$5 depending on which plan you choose.
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2. M1 Finance
M1 Finance frequently ranks high on our “best” investment list. The top-notch interface, low fees, and customizable investment pie make it the perfect choice for investors looking for a disciplined yet unique investment experience.
M1 Finance allows users to opt-in to ‘auto-investment’. With Auto Invest, M1 Finance’s algorithms will rebalance your portfolio as long as you have at least $25 in cash in your account. This “smart” rebalancing automatically keeps investors in line with their stated goals.
M1 Finance supports Roth, Traditional and SEP IRAS, allowing many investors to automate their tax-advantaged investments. We also support individual and joint brokerage accounts.
3. Charles Schwab’s Intelligent Portfolio
Charles Schwab Intelligent Portfolio is a free robo-advisor service for people with at least $5,000 in their account. The Intelligent Portfolio app makes it easy to set up recurring transfers to your account.
Users choose from several different pre-designed portfolios investing in 51 widely diversified low-cost ETFs. When funds are credited to the account, Schwab automatically invests the funds and rebalances the portfolio.
However, the app is also compliant with Loss Recovery Act to minimize taxes (only for taxable accounts with a balance greater than $50,000). It’s nice to have a robot take over the complex but mundane tasks, as this kind of efficient investment is somewhat complex to do manually.
The only major drawback of the Intelligent Portfolio app is its high cash position. Most portfolios hold between 6% and 30% of their portfolio in cash, and this can impact overall portfolio performance, especially for multi-decade investment horizons.
Wealthfront is one of the most popular robo-advisor platforms available to investors today. It is one of the most “true” automated investment platforms in terms of creating and automating portfolios. Once you set up your account, all you have to do is deposit money and the rest is done automatically. You can even set up recurring investments to make that happen.
Wealthfront charges an annual management fee, which is currently 0.25% of AUM. In other words, the more you invest, the more you pay.
Stash is another investment app that has been around for years with a focus on making things simple and easy. Aside from the round-up feature, it’s probably Acorns’ most direct competitor.
With Stash, you set your investment goals and portfolio, deposit funds, and it automatically invests to match your portfolio. We also focus on making investing easy, simplifying investment terms and making things easier.
However, you will pay a monthly fee to invest in Stash. You pay between $3 and $9 per month, depending on which plan you sign up for.
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Other Notable Automated Investing Apps
We selected only the true top automated investing apps, but unfortunately there were also a few that fell short of the rankings. These honorable mentions are worth noting as they may be suitable for certain investors.
Webull is a great app for automating active trading. It’s commission-free and informative, making it a great option for active traders. But it’s also a great place for investors looking to automate their purchases.
Automating active trading may seem like a contradiction. However, in this case it means the user will be able to set the buy/sell price and the app can handle it. This is much easier with Webull than most apps. However, this brokerage does not currently support fractional shares.
The general availability offers a DRIP, but does not currently provide a clear way to set up recurring investments. Part of this may be intentional. The public wants users to buy into the social aspect of stock market investing. And automated investments do not fit this. But we are already eyeing this rising star that is pushing odds and commission-free trading.
What’s so great about automated investment apps?
These days, most investment platforms allow some form of regular investment. But good automation is more than just allowing users to automatically transfer funds to their accounts. In creating the list, we considered her five main criteria:
Why aren’t micro-investment apps on this list?
The micro investment app specializes in small investments. In many cases, users can purchase fractional shares using only a few dollars at a time. They even connect to your checking account, “roll up” transactions to the nearest dollar, and flow the excess amount into your investment account.
The idea behind the microinvestment app is that small savings can go a long way. In a way this is true. But most people will need to invest more than pennies to reach their long-term financial goals.
And while the fees on these apps may seem low on the surface (typically $1-$3 per month), they can be surprisingly high when compared to relatively small investment balances. For most people, setting up automatic transfers of $20-25 per week to any of the above apps will yield better results than small savings.
Should I use the automated investment app?
If you’re serious about building your assets, it’s a good idea to employ some kind of handy automation to keep you on track to reach your goals. Simple steps like setting up recurring transfers to your investment account can ensure you’re on the right track.
If you like playing with investment accounts, reading investment news, and researching new stocks, you probably don’t need to use any particular investment automation technology (besides regular savings). If this is you, you can probably trust yourself to buy new stocks and keep investing.
However, those new to tracking investments and buying new stocks should consider automated investing. Life happens, but most people want to keep investing even if they can’t keep their portfolio. For this type of person, automated investment apps are perfect.