Stash review 2023

• Low account minimum
• Allows you to invest as you spend
• Custodial accounts for children

Stash’s investing app may hold particular appeal for those starting with small amounts of money who are looking for a simple robo-advisor that allows them to boost their savings and investments as they spend. You can get started with just $5 and will be able to increase your portfolio from there by using Stash features such as rounding up your purchases or receiving stock through the Stock-Back debit card, which allows you to earn stock in the companies you shop at or through an ETF of your choosing. While the monthly fees are small on an absolute basis, they can translate to high annual expense ratios if you’re starting with a small portfolio, though they decline on a percentage basis as your portfolio grows.

Stash’s Smart Portfolios are fairly minimalist compared to the rest of the industry. You’ll only have three portfolios to choose from, but those portfolios have low fund fees overall. The decision to offer expensive crypto funds as an option may not have worked out as hoped, with leading coins dropping more than 70 percent from their highs.

If you’re looking for a more comprehensive robo-advisor offering, you might consider industry leaders such as Wealthfront or Betterment. You’ll get better portfolio options while still having a strong cash management account. Investors looking for an offering similar to Stash might consider its rival Acorns.

Pros: Where Stash stands out

Two service plans (including custodial accounts)

Stash offers two service tiers that provide a basic and premium level of service, so users can access the features that they really want. The tiers are priced at $3 and $9 per month.  

• Stash Growth – This tier targets beginners and gives customers the option to open a taxable account, a managed account (Smart Portfolio) and either a traditional or Roth IRA. You’ll also get the Stock-Back Card, which allows you to invest as you spend, as well as $1,000 in life insurance.
• Stash+ – The premium tier comes with all the benefits of Stash Growth and adds custodial accounts for children, Stock-Back Card bonuses, improved research and $10,000 in life insurance.

At the Growth tier, you have access to the managed portfolio, what Stash calls Smart Portfolios. This service selects one of three preset portfolios ranging from conservative, moderate to aggressive (more below). 

The upper-service tier includes custodial accounts for children, a feature that is unusual in the robo space. Stash also doubles down on the Stock-Back card with higher bonuses.

Prior to August 2022, Stash offered a beginner plan that was just $1 per month. The plan was eliminated to give all customers access to retirement accounts and Stash’s Smart Portfolios.

Smart Portfolios vs. choose-your-own investments

Unlike other services offering managed portfolios, Stash started out by offering clients the ability to purchase individual stocks and ETFs without guidance. That model has shifted in recent years. You can still buy stocks and ETFs, but Stash can also set up a managed portfolio for you through a program it calls Smart Portfolios. 

Smart Portfolios places your funds in one of three preset managed portfolios, depending on when you need the money and your risk tolerance. They’ll be distributed among stocks and bonds, with the conservative portfolio more heavily weighted to bonds and the aggressive portfolio heavily loaded with stocks. That’s industry-standard asset allocation.

In late 2021, Stash announced that cryptocurrencies would also be included in Smart Portfolios, replacing a small part of the overall bond holdings in its portfolios. Stash said it believes “more mature digital currencies” have long-term growth potential and diversification benefits for portfolios. The portfolios don’t invest directly in cryptocurrencies, but rather hold Unit Investment Trusts offered by Grayscale, a cryptocurrency asset manager. 

Currently, Grayscale trusts holding Bitcoin and Ethereum are the only two funds available through Smart Portfolios and come with expense ratios of 2.0 and 2.5 percent, respectively, some of the most expensive fees for funds offered by robo-advisors. Though Stash insists it isn’t chasing an investment fad by offering cryptocurrencies, the growth potential and diversification benefits it speaks of have not been proven in any sort of definitive way. Both funds have performed terribly in 2022, as the prices of Bitcoin and Ethereum tumbled more than 70 percent from their all-time highs.

Even if you don’t use the managed portfolio, you’ll have the option of buying your own stocks or options. If you want a specific themed ETF, you can search the ETF list and see if Stash offers it. You’ll be able to choose from the most popular stocks, too.

You can buy fractional shares and start investing with just $5, so it’s accessible to all investors. You’ll be able to reinvest all dividends automatically, keeping your money working at all times.

Well-developed educational content

A useful feature of Stash is the variety of investing news and content it offers. Stash provides helpful articles on basics such as diversification, need-to-knows such as taxes and investing content on IPOs and other sectors, for example. You can also sign up for Stash’s weekly email, called The Wallet, which features more news and resources. All in all, it’s a nice benefit for those using the Stash app, though of course you can access all this content without actually using the app. 

Stock-Back card and round-ups

The Stock-Back card is a novel twist on a rewards card, and helps customers get spending rewards in stock rather than points, miles or cash. You’ll receive the Stock-Back debit card when you open a cash management account, which is available in all service tiers. 

The feature rewards you in stock of the company you’re purchasing from. For example, your morning coffee at Starbucks earns you Starbucks stock. If you’re buying from a company that doesn’t have publicly traded stock, then the rewards go into a stock or ETF you’ve preselected.

Stash also recently boosted what consumers will earn through the Stock-Back card, increasing the reward to 1 percent of your purchase, up from just 0.125 percent last year. This means you’ll earn $1 in stock on a $100 purchase.

Stash has also enabled round-ups on the account. Whenever you purchase something, Stash will round up the amount to the next dollar and deposit the money into your cash account. This feature has proved popular with consumers and helps you automatically save while you spend. 

Cash management account

Stash offers a solid cash management account with some of the usual features as well as one of the more unusual: the ability to get your direct deposit payroll check a couple days early.

Stash’s cash management account features include:

• No overdraft or maintenance fees 
• No minimum balance
• 55,000+ fee-free ATMs
• Instant transfer to investing accounts
• Mobile check deposit
• “Stock-Back” debit card
• Billpay and check writing

The downside to Stash’s cash management account: It doesn’t offer any interest. Compare that to Wealthfront’s offering, which provides the key features here plus interest – all at no cost. 

Renamed ETFs

When you’re looking at the names of traditional ETFs, it can be easy to get caught up in the naming. So Stash has thematically retitled the 90+ ETFs on its platform so that you have some idea what they actually contain in terms that a layperson can understand. 

For example, the Vanguard Intermediate-Term Treasury Index Fund ETF becomes “Uncle Sam: Medium Term” for its exposure to medium-term U.S. government bonds. Meanwhile the Vanguard Mid-Cap Index Fund ETF becomes “Middle Market” for medium-sized U.S. firms.

Is it gimmicky? A little. But the titles help reflect what’s in the fund in an easy-to-digest way.

Cons: Where Stash could improve

Pricing

Like a few rivals (including Acorns and Ellevest), Stash offers managed portfolios for a monthly fee. While Stash’s monthly fee ($3, $9) is not high in an absolute sense, it may be quite pricey when judged by the standards of the rest of the industry. The industry generally prices on how much you have invested with the company, that is, your assets under management. 

For example, with just $1,000 in your account and using Stash’s entry-level tier at $3 per month, you’re paying $36 per year or 3.6 percent. That compares to an industry standard of 0.25 percent, or about $2.50 for every $1,000 invested. That’s not a lot of money in the aggregate, certainly, but if you’re working with a smaller portfolio, every dollar counts. 

That said, the fixed-cost model can prove remarkably attractive if you’re bringing significant money to the robo-advisor, since your assets go up but your fees don’t. 

However, if cost is your key objective, you might have a look at SoFi Automated Investing, which charges no management fees or Schwab Intelligent Portfolios, which also lets you duck the management fees, though you’ll have to cough up $5,000 to meet their account minimum.

Basic managed portfolio and lack of clarity on investments

The Stash managed portfolio is the most basic portfolio in this space, with just three preset investment options – a conservative, a medium and an aggressive portfolio. As mentioned above, these portfolios are constructed using just a handful of ETFs, the details of which are a bit difficult to determine unless you actually sign up for an account. 

While this portfolio approach is vanilla in its sophistication, it should work acceptably. So much in investing is unnecessarily complex, though sometimes complexity does provide extra juice. 

Stash does not offer any kind of tax strategy, though it does automatically rebalance your portfolio at the end of each quarter if you move more than 5 percent from your target allocations. 

A more well-developed portfolio process would likely generate high returns here. 

No automated ESG portfolio choices

With just three portfolio options ranging from conservative to aggressive, Stash lacks the choices offered by other robo-advisors. Its rival Acorns now offers 23 ETFs within their automated portfolio choices, including some focused on environmental, social and governance (ESG) issues, which can be popular with younger investors. 

Stash chose to include cryptocurrency funds in its portfolios before offering investors fund options beyond the basics. Crypto is an innovation that may benefit investors, but Stash could improve its portfolios by adding funds in more traditional asset classes first.

Limited account types

Stash has a relatively limited selection, with a bit of a strange twist. It allows individual taxable accounts, but not joint. It also offers the typical traditional IRA and Roth IRA. The twist: It also offers custodial accounts in its upper tier. 

Custodial accounts are a little bit unusual in robo-advisor accounts, with close rival Acorns also offering them. But Acorns allows you to access them at a lower price point than Stash does. That said, Stash’s upper tier also brings some other perks to the table, as discussed above.