Building wealth generally requires regular saving and a disciplined approach to investing. Unfortunately, these things are easier said than done.
Fortunately, auto-investing apps make it easier for ordinary people to become great investors. They can be great “set it and forget it” options for buy-and-hold investors who aren’t interested in short term trading.
Below, we break down our three best auto-investing apps of 2023 before sharing a few other apps that didn’t quite make it to our list but may still be worth considering.
Our pick of the best auto-investing apps of 2023
After reviewing more than two dozen best brokers and micro investing apps, we narrowed down the best auto investing apps to these three.
tassels is one of the original automated investing apps ever created. It was the first “spare currency” app, where you could round up your spare currency and invest. Then they also started to focus on automated investments.
Acorns takes your roundups and auto investments and puts them into low-cost index funds so you can see long-term growth. It’s a simple “set and forget” approach, which is what most people looking for auto investing apps are looking for!
The downside of Acorns is the fees. Unfortunately, Acorns isn’t free – and you’ll pay monthly fees ranging from $3 to $5 per month depending on the plan you select.
2. M1 Finance
M1Finance often tops our “best of” investment lists. The top-notch interface, low fees, and customizable investment sectors make it a great choice for investors looking for a disciplined yet unique investing experience.
M1 Finance allows users to opt for “Auto-Invest”. With automatic investing, M1 Finance’s algorithms will rebalance your portfolio whenever you have at least $25 in cash in the account. This “smart” rebalancing automatically keeps investors more in line with their stated goals.
Since M1 Finance supports Roth, Traditional and SEP IRAS, it allows many investors to automate tax-efficient investments. It also supports individual and joint brokerage accounts.
3. Charles Schwab Smart Wallets
Charles Schwab Intelligent Portfolio is a free robo-advisory service for people with at least $5,000 in their accounts. The Intelligent Portfolio app makes it easy to set up recurring transfers to the account.
Users choose from several different pre-designed portfolios that invest in 51 broadly diversified and low-cost ETFs. Each time money arrives in the account, Schwab automatically invests the money to rebalance the portfolio.
However, the app also tracks tax-loss harvest laws to help minimize taxation (only for taxable accounts with balances greater than $50,000). This kind of efficient investing is somewhat complex to do manually, so it’s nice to see robots taking on complex but routine tasks.
The only major downside of the Intelligent Portfolio app is the high cash position. Most portfolios hold between 6 and 30% of the portfolio in cash, which can hurt overall portfolio performance (especially when the investment horizon is decades).
4. Wealth Front
wealth front is one of the most popular robo-advisor platforms currently available to investors. It is one of the most “true” automated investment platforms in the sense that it will create and automate your portfolio. Once you have set up your account, all you have to do is deposit some money and it will do the rest. You can even set up recurring investments to make this happen.
Wealthfront charges an annual management fee – which is currently 0.25% AUM. This means that you will pay more as you invest more money.
Stash is another long-running investment app that has focused on keeping things simple and easy. It’s probably Acorns’ most direct competitor, minus the roundup feature.
With Stash, you set up your investment goals and portfolio, and when you deposit funds, it will automatically invest to match your portfolio. They also place great emphasis on ease of investment – they simplify investment conditions and make things easier.
However, you will pay a monthly fee to invest with Stash. You’ll pay $3 to $9 per month depending on the plan you sign up for.
Other Auto Investing Apps to Look Out For
Although we’ve chosen only the best auto-investing apps, there are a few that just missed the cut. These honorable mentions are worth highlighting as they may suit some investors.
Webbull is an excellent application for automating active trading. Commission-free and information-packed, it’s a great choice for active traders. But it’s also a great place for investors looking to automate their purchases.
Automating active trade may seem like an oxymoron. But in this case, we mean it allows users to set buy and sell prices which the app then manages. It’s much easier in Webull than in most apps. However, this brokerage does not support fractional shares at this time.
Audience DRIP offers, but it doesn’t offer an obvious way to set up recurring investments at this time. Some of this may be intentional. The public wants users to embrace the social aspect of stock market investing. And automated investing does not match that. However, we are watching this rising star who is already promoting fractional stock investing and commission-free trading.
What Makes an Auto Investing App Great?
These days, most investment platforms allow some form of recurring investing. However, great automation is not limited to allowing users to automatically transfer funds to their accounts. To create our list, we considered five major criteria:
Why aren’t micro-investment apps on this list?
Micro-investment apps specialize in investing small amounts of money. They often give users the option to buy fractional shares using only a few dollars at a time. They can even log into your checking account and “roll up” trades to the nearest dollar and skim off the excess in your investment account.
The idea behind micro-investment apps is that a little savings goes a long way. In some ways, that’s true. However, most people will need to invest more than loose change to achieve their long-term financial goals.
And while the fees for these apps may seem low at first glance (typically $1-3 per month), when you compare them to relatively low investment balances, they can be shockingly high. For most people, setting up an automatic transfer of $20-$25 per week to one of the apps listed above will yield better results than micro-savings.
Should you use an auto-investing app?
If you’re serious about building wealth, we recommend using some kind of helpful automation to keep you on track to achieving your goals. Simple steps like setting up recurring transfers to your investment accounts can ensure you’re moving in the right direction.
People who like to play with their investment account, read investment newsAnd look for new stocks probably don’t need to use specific investment automation technologies (beyond regular savings). If that’s you, you can probably trust yourself to buy new stocks and stay invested.
However, those who are not disciplined about tracking investments and buying new stocks should consider automatic investments. Life happens, but most people want to hold on to their investments even when they can’t keep up with their portfolio. For those in this category, auto-investing apps are a perfect fit.