11 Best Micro-Investing Apps of 2023

In the past, investing was thought of as something only wealthy people did. And unfortunately, many people used this as an excuse to put off saving for retirement, saying they would do it when they earned more money.

But if you wait to start investing, you lose out on the benefits of compound interest and shortchange your retirement savings. So, it’s best to get started as soon as possible, even if you only have a bit of money to tuck away every month.

One of the easiest ways to invest money is by using micro-investment apps. This article will explain what micro-investing is, how it works, and six micro-investing apps we recommend trying out.

11 Best Micro Investing Apps

Micro-investing apps make it easy to get started with small amounts of money and learn the basics of investing. We’ve compiled a list of the 11 best micro-investing apps on the market today. Whether you’re a beginner or a seasoned investor, you’re sure to find an app that fits your needs and investment goals.

What is micro-investing?

According to one survey, more than 47% of Americans are not saving for retirement. When pressed about their decision not to invest, over 34% said they don’t have enough money to invest.

The basic premise behind micro-investing is that you only need a few dollars to start investing. When you use a micro-investing app, you invest in very small increments by buying fractional shares.

With a micro-investing app, you can invest as little as $5. And with micro-investing, you don’t have to know anything about the stock market. The money you save is put in a portfolio of stocks that the company creates for you.

Is micro-investing even worth it?

Micro-investing will not get you rich, and it’s not going to help you fund your retirement goals. For that reason, it’s easy to write micro-investment apps off as not being worth your time.

But every day you put off investing is one less day that your money can grow in the market. So, you can wait until you feel like you have “enough money,” or you can work with what you have today.

Here are just a few benefits of using a micro-investing app:

• Invest with very little money: Micro-investing platforms allow you to invest, even if you only have $5 to spare. So if you can skip your morning latte, then you have enough money to give micro-investing a try.
• Save it and forget about it: It’s hard to set aside money in a savings account. You know it’s there, and it’s easy to access and spend. With a micro-investing app, it’s easy to save your money and forget about it.
• Build positive habits over time: Anytime you’re trying to build a new habit, it’s best to start small. Micro investing allows you to ease into investing, and you can start saving more money when you’re ready.

See also: How to Invest: A Basic Guide to Making Your Money Grow

Pros and Cons of Micro-Investing Apps

While it’s true that micro-investing provides many benefits, they’re not necessarily the right choice for everyone. It’s worthwhile taking the time to understand the all nuances before committing financially.

Pros

24/7 Access

Using a micro investing app allows you full access to your investment account around-the-clock. You won’t ever have to worry about opening hours or holidays getting in the way of your ability to monitor and manage your funds.

Easy Fractional Investment

Traditional investment in stocks and ETFs requires large amounts of funding, but micro investment means you purchase fractional shares quickly and easily. This means you can begin your investment portfolio with your spare change, rather than hundreds or thousands of dollars.

Low Account Minimums

Another factor which makes micro investment apps attractive are the low account minimums. Most micro-investing apps have $0 minimum balance requirements, so you can begin investing with as little as you wish.

Safety

As with traditional investment accounts, legitimate micro-investing platforms will be registered with the U.S. Securities and Exchange Commission. On top of that, all savings and checking accounts with micro investing companies are FDIC insured.

Cons

Fees Can Be High

Account fees that come associated with micro investing apps can vary, so it’s important to watch out for this. Don’t assume that an account with low minimums will also have low fees. If you’re only investing small amounts, paying high fees might not seem like a good deal in the long term.

Limited Investment Choice

Most micro investment apps won’t allow you to handpick the stocks inside your portfolio. While you will have choice regarding which set portfolios you invest in, you’re less likely to be able to pick and choose specific stocks.

Won’t Change Your Retirement Plans

One thing to keep in mind is that using a micro investment app won’t do much to affect your retirement on its own. Micro investing is more about learning good investment habits, and getting familiar with maintaining and growing a portfolio.

Features of the Best Micro-Investing Apps

So, how do you decide which micro investing app is the right one for you? We’ve compiled a list of the most important features below to help you know what to look for. The best micro investment apps will have the following qualities:

Ease of Use

Fundamentally, the best micro investment apps will be easy and intuitive to use. They are often free of the usual clutter and jargon of some traditional brokerage accounts. With simple, easy to navigate interfaces these apps should provide an enjoyable user experience for all.

Low Minimum Investments

Good investing apps should allow you to access the market with just a few dollars. This is possible because they’re designed to allow you to purchase fractional shares of ETFs and other assets. Not all investing apps will come with a low minimum investment, however, so be sure to check if you’re a low budget investor.

Diversified Investment

The best micro investing apps will provide users with the chance to invest in diverse portfolios which are automatically generated. Asset allocation and diversification can be challenging even for experienced investors, so this is a great feature of these apps.

When you’re starting out as an investor, the sooner you can learn about diversification the better. And these apps should make it relatively easy for you to both practice and learn about asset diversity.

Educational Tools

As most micro investing apps will be marketed to newcomers, education is an important factor. If you’re just starting out with investing, then the best micro investment app for you will likely provide a wealth of educational resources and advice.

Keep in mind, however, that most micro-investing apps won’t offer access to a professional financial advisor.

Recurring Transfers

The best investing apps allow you to easily set up automatic transfers from your bank account to fund your investment account. A recurring transfer can remove some of the human error involved in managing your account and allow you to quickly build up a habit of funding your account.

Additional Services

While some micro investing apps are minimalist and simple, others come with the option of additional financial services. In addition to brokerage accounts, some offer access to a savings or checking account, as well as IRA and custodian accounts. Depending on your own financial goals, an app with additional services might be worth the extra fees.

Best Micro-Investing Apps FAQ

How much does micro investing cost?

Micro investing generally comes with low fees and low minimum balance requirements. This makes it extremely affordable, in some cases costing virtually nothing on top of your stock purchases. A lot of micro investing platforms offer commission free stock and ETF trading.

Micro investing apps do need to make money, of course. Some of them do charge monthly subscription fees, but these are usually reasonable considering the service provided.

Which app is best for small investments?

Choosing the best app depends on your own budget, needs and goals. The market for micro investment apps has grown rapidly, and there are a lot of different options out there.

The list we’ve compiled in this article are our top picks, and are among the best micro investing apps available. These apps make it easy and convenient to begin investing. They also provide various unique features, low fees, good customer support and educational resources.

Who should use micro investing apps?

Micro investing apps are a fantastic way to begin investing small amounts while you learn the ins and outs. But who will benefit the most from using these apps?

• Beginner investors: these apps are perfect for young investors and newcomers because you only need a small amount of money to start.
• Passive investors: Most micro investing apps are actually robo-advisors which invest on your behalf based on your needs and budget. This automated investing allows you to establish a diversified portfolio based on your goals that you can simply set up and forget about, letting it work away in the background.
• Emotional investors: Automated investing means you can’t make rash emotional decisions based on market swings. Instead of constantly worrying about market performance, you just invest small amounts and build your portfolio slowly over time.

Can you get rich from micro investing?

The reality is you’re not going to get rich through micro investing. The point of micro investing isn’t to get rich. Rather, it’s all about building with what you have and learning how to build good investment and financial habits.

The philosophy behind micro investing is that investing any amount is better than nothing at all. And if you earn even small returns on your spare change, while at the same time educating yourself about investing, then why not try it?

How do I start micro investing?

Investing today is more accessible than ever before. Nevertheless, it still seems an intimidating world for those who have no experience or education. If you don’t know where to start, you can follow these steps to begin investing with confidence:

1. Decide Between DIY or Automated Investing

If you’re not yet comfortable choosing your own investments, and managing your own portfolio, you’ll want to start with robo-advisor investing. It’s totally normal for beginners to feel uncomfortable choosing stock to invest in, and automated investing is the safer option in any case.

2. Identify Your Investment Goals

This is often the hardest step for new investors, but it’s one of the most important. Figuring out your short and long term financial goals will help bring purpose and structure to your investment decisions.

Generally speaking, investing is successful when considered a long term project. You’re much more likely to find success with investments by holding stock long term, rather than trying to figure out when the best time to buy or sell is.

3. Determine Your Monthly Investment

The traditional advice is to save and invest 20% of your monthly income. With the rise of micro investing, however, you don’t even need to invest much to begin with.

It’s important to pick an amount you can reasonably commit to. Of course, you can always change your automatic investment amount, or just add on extra when necessary, but it’s always better to set it and forget it. Even if it’s a small amount, consistency and time and the key ingredients to good investing.

4. Choose an Account That Fits Your Goals

Once you’ve got your budget and goals determined, it’s time to choose a platform to begin investing with.

Keep in mind that you can always switch the platform you use for micro investing, or even open accounts with more than one if you wish. Just make sure to take all fees into account before you sign up and get committed.

Final Thoughts

Thanks to micro-investing apps, you can invest your money in the stock market even if you only have $5 to spare. Each of the six micro-investment apps reviewed in this article will help you get off to the right start.

Micro-investing won’t help you reach all of your retirement goals. However, it’s a good way to start saving if you’re in a tight financial situation. The most important thing is to start investing and increase the small amounts you’re putting away over time.