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Betterment vs. Acorns
The size of your portfolio plays a role in how you weigh these platforms.
Both Betterment and Acorns help investors allocate funds with the help of a robo-advisor. But one becomes more competitively priced the more you have to invest.
Which one is better?
- Choose Betterment if you have less than $5,000 in your portfolio.
- Choose Acorns if you have more than $5,000 in your portfolio.
These two platforms offer the same convenient set-it-and-forget-it approach to investing: investors sign up, create a profile, fund their account and the robo-advisor takes care of the rest.
Betterment and Acorns have a number of similar offerings — they both have tiered services, well-reviewed mobile apps and aim their features squarely at passive investors. They also offer fractional shares, portfolio rebalancing and tax-loss harvesting.
So is one better than the other? It depends on what you value most as an investor — and how much you have to invest. When we compared Betterment’s standard annual rate with Acorns’ lowest monthly fee, we discovered that Betterment’s pricing structure was better suited to portfolios under $5,000, while Acorns rates were more competitive above the $5,000 mark.
How do Betterment and Acorns compare?
|Overview||Betterment is an online financial advisor that makes investing easy by creating a portfolio just for you, based on your preferences and financial goals. It’s a solid choice for those new to investing.||Acorns is a robo-advisor that offers individual investment accounts, retirement accounts, custodial accounts — even a checking account that comes with a free Visa debit card. It’s best suited to buy-and-hold investors who want their money managed for them.|
|Minimum deposit to open||$0||$0|
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Betterment and Acorns aim their platform features at passive investors executing a buy-and-hold strategy. Betterment has more asset classes to choose from, but Acorns tosses in a free checking account for investors who subscribe to its Personal tier. Their differing fee structures makes Betterment the practical option for portfolios under $5,000 and Acorns better priced for portfolios above $5,000.
Before you apply, review your account options across multiple brokerages to find the account best suited to your investment needs.
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