Is Acorns a Scam? 

If you’re thinking of using Acorns, you need to know: Is Acorns a scam? 

Below, we explain whether Acorns is a scam and discuss some steps you can take to improve your safety when using this platform. 

What Is Acorns?

Acorns is a micro-investing app. 

The app rounds your purchases up to the nearest dollar and invests the difference. You can also schedule regular deposits or contribute lump sums.

You can choose from a range of portfolios to invest in. Portfolios are built using third-party, passively managed ETFs.

Is Acorns a Scam?

No, Acorns is not a scam, but it may not be the best investing option, either.

Acorns gets mixed reviews from online publications. 

For example, NerdWallet gives Acorns a 4.6 out of 5.0-star rating, whereas Bankrate gives Acorns a 3.0 out of 5.0-star rating. Investopedia gives Acorns a 4.4 out of 5.0-star rating. 

Pretty much all reviews seem to agree that Acorns can be a good option for new investors or those struggling to save but that the monthly fees can outweigh the savings for small balances. 

Internet users’ opinions on Acorns are also mixed.

Some users appreciate Acorns’ round-up feature as an easy “set it and forget it” way to start investing. 

However, several people say the monthly fee is too high for small account balances and can eat into any gains.

Most users recommend looking into traditional brokerages, which allow for small, automated investments without the extra fees. 

Acorns gets a 4.7 out of 5.0-star review (from 345,700 ratings) on Google Play and a 4.7 out of 5.0-star rating (from 916,415 ratings) on the App Store. 

Security

Acorns describes its security measures on its security page on its website.

Acorns protects your personal and financial data with 256-bit or higher encryption at all times.

The company requires multi-factor authentication during login to ensure that only you can access your account.

Acorns’ systems undergo continuous security testing and regular audits by a “Big 4” accounting firm and are assessed for SOC 2 compliance. 

Internal systems use role-based access and multi-factor authentication so that only necessary personnel have access. Acorns says they also have a strong culture of security awareness among employees.

A dedicated Security Operations team monitors for suspicious activity around the clock, and Acorns proactively alerts you if any issues arise or if there are potential scams.

Acorns also has the following protections when it comes to keeping your money safe: 

• SIPC coverage: Securities in your account are protected up to $500,000.
• FDIC insurance: Your deposits in the Acorns Checking account are insured up to $250,000 through their banking partners.

According to Acorns, the company does not store your bank login information. 

The company also has a vulnerability disclosure program and an email that anyone can use to notify Acorns of a security issue. 

Privacy 

Acorns describes what data it collects, why, and with whom it shares it in its privacy policy. 

Acorns collects the following personal information:

• Data you share with it directly: Your contact information, government IDs (like your Social Security number), billing data, transaction history, etc. 
• Data it collects from you automatically: Device data, browser information, your online activity, location data (if you permit this), cookies, web beacons, and data from mobile SDKs and chat tools.

Acorns uses your personal information to run and improve its own services and to meet regulatory requirements. 

It also uses your data to market and advertise to you, as research on how to improve its services, and for compliance and protection (like preventing fraud or illegal activity on its platform). 

Acorns shares your information with affiliates and service providers, financial institutions like Plaid and banks, advertising and marketing partners, and professional advisors, authorities, or during business transfers such as mergers or acquisitions.

It only keeps your personal information for as long as needed for business or legal purposes. It says it can transfer your data internationally, including to places with different privacy protections.

As is fairly common, you have the right to review/update/request the deletion or correction of your personal information. You can also opt out of marketing communications and limit interest-based advertising. 

So, Should You Use Acorns?

Depends on your current financial situation and what your financial and investment goals look like.  

If you’ve never invested before or are finding it difficult to save money and like the idea of investing your “spare change,” then Acorns can be a decent starting point. 

However, generally speaking, you’re probably better off with a traditional brokerage that charges a percentage-based fee rather than a flat monthly fee.

How to Use Acorns Safely

• Turn on multi-factor authentication (MFA). Acorn has an MFA option, so turn it on to add extra protection to your account.  
• Use strong, unique passwords. Create a password you’ve never used before for your Acorns account. Consider using a passphrase or a password manager to generate random passwords for you. 
• Monitor your account activity. Regularly checking your transaction history and account alerts can help you spot any unusual activity quickly.
• Keep your device secure. Update your device and the Acorns app whenever a new update is available to protect against vulnerabilities.
• Exercise your privacy rights. As per Acorns privacy policy, you can access, correct, or delete your personal information. To do so, email support@acorns.com or send a physical letter to Acorns Legal, 5300 California Ave., Irvine, CA 92617. 
• Opt-out of marketing communications and ads. Use the opt-out mechanisms for marketing communications and interest-based advertising, either through your Acorns account settings or your browser and/or device settings.
• Stay informed. Keep an eye on any updates or changes to the privacy policy and follow any additional recommendations Acorns provides for maintaining your privacy.