How Millennials Are Investing Their Money

Millennials are changing the investing landscape. Those born between 1979 and 1999, who have become known as the Millennial Generation, are taking advantage of social media and crowd-funded applications to invest in unusual investment vehicles. While brokers and traditional investment tools are still extremely relevant, their prevalence with millennials is slowly fading. Instead, social media, mobile apps and digital financial planners have replaced brokers, wealth managers and advisors for much of the younger population.

Not only are these applications attracting Millennials to their services; they’re actually getting them interested in investing. The younger generation is flocking to services that value transparency, ease-of-use and quicker gratification. While these digital services may not be the smartest way to invest and manage money, they definitely are innovative. Here are just of a few of the applications millennials are using to manage their money.


Founded by father and son team Jeff and Walter Cruttenden in 2012, Acorns is an app that allows its users to round up their daily purchases and automatically invest the change into a diversified portfolio. Comprised of index funds offered by the world’s top asset managers and completely commission-free,  Acorns is an great investment tool for those who frequently use credit cards or make online transactions.


Acorns works by monitoring your bank account and automatically investing the spare change from your daily purchases. If you were to make a purchase with your Bank of America card for a $3.75, then $.25 cents would be deposited into you Acorns account. Acorns lets users choose between five different portfolios on a scale of conservative to aggressive risk. There are many other features to Acorns’ service, like the ability to make deposits ranging from $5 to $50,000 or the ability to make daily, monthly or yearly deposits. The main advantage to Acorns is its simplicity: it requires very little attention to the app itself. While it may offer well-below average returns, a savvy millennial may use it due to the fact that it takes up very little time, and if nothing else it helps save money.


There are some drawbacks to Acorns however. For one, the app charges a $1 per month fee for all accounts under $5,000 and a .25% annual fee for all accounts over $5,000. While this may not seem like a lot, you are only really investing change into Acorns. Those $1 monthly fees can really start to add up. In order for Acorns to give you any substantial return, you need to spend a lot of money.  This is not always a good financial strategy.


Founded in 2013 by entrepreneurs Baiju Bhatt and Vladimir Tenev, Robinhood is a stock brokerage application that allows users to buy and sell U.S. listed stocks and ETFs with zero commission. You can use the application on your smartphone, tablet, but surprisingly not on a computer. Similar to Acorns, Robinhood‘s main marketing point is that it charges zero-brokerage fees. However with Robinhood’s service you are the one who chooses the investment option.robinhood-2

Robinhood claims that it has saved users over $22 million  in commission fees. Within the mobile Robinhood interface, a user is limited to bread-and-butter stocks. If you’re not satisfied with only prudent investments in blue chips, you might want to hold on: Robinhood plans to implement more advanced options soon, such as options, OTC securities, mutual funds and warrants.


The name “Robinhood” comes from the critically-panned 2010 film Robin Hood, in which the main protagonist played by Russell Crowe steals from the rich and gives to the poor.

It would seem that there would have to be a catch with Robinhood. After all, how would Robinhood make money without charging a brokerage fee? It turns out there is no catch, just different levels of service.  Robinhood offers a Gold Subscription service in which it collects interest on users who choose to upgrade (with an additional monthly fee). This premium subscription gives users access to features that major competitors like E*Trade and Schwab offer, such as after-hours trading, credit lines and larger instant deposits. However most millennials do not upgrade to the gold subscription service due to the simple fact that they originally signed up based on the premonition that the service is free. Whether or not Robinhood will be able to sustain its service is unknown.


Acquired by Intuit in 2009, Mint quickly became a hot application for millennials to track and monitor their financials.  Mint links to a user’s bank account and begins to track their spending habits.  Users can view exactly how much they’re spending on very specific categories: Gas & Fuel, Alcohol and Bars, Uber rides, etc. Mint is entirely free and regarded by experts as very secure based off industry standards.


The spending habits tracker is just the tip of the iceberg for the services Mint offers.  In addition to the tracking feature, Mint offers a budgeting application, credit score ratings, investment tracking, account security monitoring; the list goes on and on. Mint even claims by using their service, they will begin to help save you money. Many millennials are in fact finding that using Mint’s free app saves them money in a world where it is becoming increasingly easy to carelessly spend.


Mint’s interface breaks down your monthly spending habits and can display the historical data of all your transactions.



– Sam Kuchma


  1. I thought that this was an great and informative topic. As millennials, it seems as if many businesses are trying to target this age group- as we are considered the largest population group and can influence the market greatly. I liked how you set up your blog post- as these are platforms that I haven’t heard of before (except for Mint). It was interesting to see how people are leveraging these digital applications to invest their money, create funds, etc. I personally am not sure if I would allow a machine to invest my money (as with Acorn) but maybe this app would have better like than a person. Furthermore, since it is just “change” maybe people are not as attached to these types of funds, than with larger cash flows. I do think Mint is a great platform- it is amazing to realize how quickly a daily Starbucks, etc adds up.

  2. bishopkh1 · ·

    I really liked this post! I’ve been experimenting with online investment platforms and I’ve tried Acorns and Robinhood and didn’t like them. I’m currently using Ellevest, which is a similar platform but they are targeting women. It’s super interesting to see how many companies are making a move to this space and I’m curious to see how large wealth management firms will respond. I know that UBS has launched an app for users to track their portfolio performance, but I question whether that will be enough to attract millennials to the traditional way of investing.

  3. When I saw your title I was immediately interested in reading your post. I have been trading equities for about 10 years. i started out with a broker, moved to Etrade after a few years, and eventually I moved to Merrill Edge which gives me free trades. As far as robin hood goes, I used to worry that the hidden cost is in execution. I recommend that anyone using the app only place limit orders instead of market orders (with market orders you simply trust the app to get you a fair market price for the security). On large enough trade, a poorly executed market order might cost you more than a few dollars. That said, many of my friends using robin hood have very small trades, so it makes sense for them. It’s a great way to start taking responsibility for your financial future in a low risk, small scale environment.

    To me, acorn represents the trend towards oversimplification that has become so pervasive amongst millennials. It looks like the five portfolios are each multi asset portfolios, but as far as I could find there is very little information as to which “large stocks” ETFs or which “real estate” ETFs are being used. It strikes me as a way millennials can feel responsible without using more research than a cursory glance.

  4. holdthemayo4653 · ·

    Very informative post. I liked how examples were presented and explained. Personally, I have trouble wrapping my head around the concept of some of these platforms. The idea of Acorn is great but how much money actually ends up being invested by the user? Even if the daily change adds up to $1 per day that’s only $365 per year. I also agree with @goochstefan and his comment about Robinhood. If they are making no money off of the user I can only imagine and very barebones service being provided. What is the motivation for enhanced services if it draws no additional revenue?

    Reading your post makes me want to give Mint a try, although I am terrified of what it might show about my spending habits…

  5. Very good post. Mint is actually a good idea, I actually use the Spanish version of it called Fintonic and sometimes is very helpful, however I am not sure about the “helping you to save” part. Also I am curious on how they monetize this business, maybe they sell our consumption patters to other companies?.
    On the other hand Robinhood and Acorns are very good deals, but i am not sure if their monetizing policies will be actually efficient. If Rh claims are true, and he has saved 22 million dollars in commissions, it means that the volume that the company is managing is already quite big, and therefore the infrastructure is consequently large. The problem with this business is that their competitive advantage is severely inversely related to their profitability. Once this companies start to raise commissions, as they do with the Gold subscription they become widely outmatched by the infinitely bigger brokerage companies that provide, due to their size, a much bigger amount of services. So in a way I see that the viability of this companies is not very secured in a long-term perspective.

  6. Tyler O'Neill · ·

    A millennial myself, I think your blog was a fantastic read! I have only heard of Acorn before, but all of the apps that you’ve mentioned seem to have an incredible potential. I worry that Robinhood may fall behind its competitors as most millennials are ill-prepared to make their own profitable investment decisions. Also, I think Mint has a tremendous potential! When I was younger I remember my dad keeping track of all our expenses by inputting receipts into Excel spreadsheets. In our time-sensitive society, an app like Mint presents the information that consumers need to know both quickly and accurately. I imagine their will be security concerns surrounding the app if it become more prevalent, but only time will tell.

  7. Nice post. Would have been interested in hearing which you think would be more dominant and why.

  8. As a millennial who has playing the stock market since I was about 14, this was the best blog I’ve read all year. I’m really familiar with Robinhood and Acorns. I will say this about Robinhood, it’s not great for people who like to day trade because (at least when I tried it out about a year ago) it took a little over a week to access funds from Robinhood after I sold a particular stock which was frustrating.
    I was actually planning on writing something extremely similar to this for my blog due on Monday. However, I didn’t know about acorn, I think this is a really good idea especially for people who emphasize the value of saving (like myself).

  9. Aditya Murali · ·

    Awesome post! It is really cool to see apps like these help make investing more attractive to millennials, because if you asked me to start getting into investing through the traditional methods like E-Trade, I would probably be overwhelmed. I have played around with both Acorns and Robinhood, and I really like how intuitive both interfaces are. I stopped using Acorns, however, because I was told that it wasn’t the most secure platform and that it has gotten into some legal issues in the past. I still believe that these types of apps are the future of investing, and hopefully this means that the younger generation will get on board and create a culture of saving and investing their money.

  10. adamsmea89 · ·

    Great post! I liked reading about Acorns and Robinhood because I have not heard of them, and its always nice to hear what else is our there. All aspects of life have moved from face to face interactions to computer/smartphone interactions so it makes sense that investing is following this same trend. I think people need to be careful with the apps they are trusting to invest their money, because it is very easy to overlook the “small print” that may disclose fees that are not advertised. I do think more and more of these types of apps will continue to pop up, and I am sure millennial are more confident about investing their own money, and not using a financial advisor, than our parents were as a result of these apps.

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