Students Saving For The Future

 Creative Commons

Creative Commons

Being a college student in today's world is far from easy, and being a graduate is equally strenuous. Student debt has become a dreadful topic among young men, women, and their families. Now, more than ever, current students and graduates are looking for ways to help with expenses.

With the new administration in the White House working on budget plans that are bound to affect college students, the future of financial aid and student loan programs are uncertain. However, problems with student debt did not happen overnight; it has been a growing problem in America over the last few years and now it seems to be increasing faster than one might think.

Rohit Chopra, a senior fellow at The Consumer Federation of America, told the Washington Post that over 1 million people defaulted on their student loans just last year. It seems that a fairly new but expanding industry of mobile apps could serve as tools for saving money and learning how to invest while struggling with the burden of student debt.

Applications like Stash, Acorns, and DIVY allows its users to invest in stocks that may be out of the price range of many by letting them buy fractions of a stock. For example, one share of Apple’s stock recently cost just over $150 dollars. These applications give you the opportunity to own a fraction of one share with as little as $5 to $10 dollars.

Acorns is a Newport Beach based investment app that was founded by Jeff and Walter Cruttenden back in 2012 and was really at the forefront of this new wave of investing in the stock market. Acorns costs $1 a month for accounts that have less than $5000, and if a user's account has over $5000 then the app will take just 0.25% a year. Acorns is free for up to four years for college students who can provide a valid .edu address. Every dollar you invest through the app will automatically be split up into many different stocks and bonds that Acorns picks for you based on your financial situation and goals. What makes Acorns unique is that any user can connect their debit or credit card so that any purchase made with your card will automatically be rounded up to the nearest dollar. The difference will be directly invested into your portfolio. According to USA Today, Acorns has over 750,000 users, 75% of which are between the ages of 18-34.

The New York based app Stash launched in 2015 and was co-founded by its CEO Brandon Krieg and President Ed Robinson. Stash markets itself as an investment app. All you need is $5 dollars to make your first investment. Stash is almost the same as Acorns when it comes to costs. For accounts that have under $5,000 the service is only $1 a month. In accounts that exceed $5,000 Stash will take 0.25% a year.

In an interview with Forbes.com Krieg said: “Our goal at Stash is to get people to start investing -- in fact, we’re probably the only financial advisor out there that would encourage our investors to give us less money to start.”

The app offers pre-made portfolios for users to choose from so they can invest in companies that matter to them. So, if an investor is interested in companies that focus on clean energy, for example, Stash has a portfolio for that. Stash also does its best to educate users about the complicated world of finance and investing, and make it as simple as possible to understand. According to Forbes.com, Stash currently has over 300,000 users, and is adding 10,000 more a week. The Washington Post also listed Stash as one of five apps that are helping college graduates save money and start investing.

Stash and Acorns can expect some competition in the mobile world of investing very soon. A fairly new investment application is ready to start making waves in this growing industry. DIVY, which is based out of Los Angeles was founded by Marc Teren and launched in the Apple App Store just a few months ago on January 4. Similar to Stash and Acorns, DIVY allows its users to invest in the stock market with as little as $10, and encourages them to create a diverse portfolio to reduce the risk of single-stock investments.

“With dollar-based investing, our users can create a highly diversified portfolio of stocks -- without needing thousands of dollars,” said Senior Associate of Content and Member Services Hunter Kilburn.

DIVY does not charge its users by the month but it does take a commission on each stock. For example, if a $10 trade is made DIVY will only take $0.10, and if a trade of $1000 is made they will only take $1. DIVY serves as a one stop shop for everything market-related. Through the app, users will find a page that is fully devoted to market news from all major websites like CNBC, CNNMoney and Bloomberg. The app also has separate links dedicated to strictly company news, whether it's Apple, Tesla, or Amazon. DIVY will give users a full breakdown of what is happening with any company that they may be invested in. Current Santa Monica College student and member of the DIVY content team, Taylor Trautloff, said the app “goes very much into depth in a way I've never seen another investing app do.”

Acorns and Stash are currently available in both the App Store and Google Play store. DIVY is now in beta testing at the App Store, but is expected to fully launch in both the Apple and Google Play stores on June 15.