In this Stash review, we’ll take a look at an app for beginner investors to help them easily select investments aligned with causes they care about. Stash is not a robo-advisor in that it doesn’t automate and manage the process of investing for you but instead it makes investment suggestions which require you to act upon.
The Stash app allows users to build portfolios based on the suggestions made that are aligned with the user’s risk tolerance and financial goals. Users are informed when portfolios lack diversification and are educated with notifications along the way.
Stash is perhaps best thought of as a tool that simplifies the investing process and educates users to the value and method of constructing diversified portfolios. Where robo-advisors target hands-off investors, Stash attracts investors who wish to be more proactive in learning how to manage their own nest-eggs and charges a monthly fee for so doing.
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3.5 out of 5 stars
via Stash secure site
Stash makes it easy for beginner investors to set up diversified portfolios that align philosophically with themes or causes they care about. For example, investors who want exposure to eco-friendly companies, social media companies, or travel and entertainment companies can do so easily and intuitively via the Stash app.
What jumped out in our Stash Invest review is how easy the app is for beginners. If you are not sure where to begin, Stash is a great first step. Investors who are unsure how to navigate the landscape of exchange-traded and mutual funds, expense ratios, and portfolio construction will find Stash does a very good job of guiding you through the steps needed to build a diversified portfolio.
Investors who care about causes and themes will enjoy the Stash app. For example, Stash allows investors to select its Clean and Green investment comprised of wind, solar and renewable energy companies. Stash’s Social Media Mania investment allows users gain exposure to Facebook, Twitter, Tencent and other social media companies. Enjoy Yourself is another thematic investment offered by Stash that provides investors exposure via an ETF to entertainment, travel and leisure companies, such as MGM Resorts International, Las Vegas Sands Corporation, and Delta Airlines.
The Stash app is best for:
- Beginner investors
- Investors who care about aligning their investments with causes and themes
- Investors who want feedback on optimizing portfolio composition
- Investors wishing to learn how to build diversified portfolios
Stash fees are tiered based on assets invested with $5,000 as the cutoff level which triggers a change from a flat monthly fee to a % charge of assets invested.
- $1 per month for assets up to $5,000
- 0.25% annually for assets of $5,000 or more
It is worth emphasizing that Stash does not manage your portfolio by automatically placing trades on your behalf as a robo-advisory firm does so the monthly charge incurred is comparatively high given the level of service offered. For example, $1 per month might seem small at first glance but it translates to a 0.60% annual charge on a $2,000 account size.
Compared to robo-advisors, such as SoFi, who manage your portfolio at no cost up to the first $10,000, the fee charged by Stash is quite high. On the other hand, a robo-advisory firm doesn’t incorporate the educational content Stash freely provides. So if you’re looking to learn how to build a portfolio with a view to lowering costs long-term, Stash provides a great deal of value for the fees it charges.
Stash Investment Themes
Stash Invest renames exchange-traded funds to make it easier for beginner investors to understand what they’re investing in thematically. Themes include: American Innovators, Clean and Green, All That Glitters, Equality Works, Conservative Mix, and Park My Cash among others.
Stash makes it intuitive for investors to know where they are investing their by labeling exchange-traded funds descriptively. For example, American Innovators includes tech companies such as Apple, Google, Facebook and Cisco. Clean and Green allows investors exposure to renewable energy companies via the iShares Global Clean Energy ETF. And Equality Works features the Workplace Equity Portfolio ETF that comprises companies supporting equal rights for members of the LGBT community.
Other thematic investments include Park My Cash, Blue Chips, Conservative Mix, Aggressive Mix, and All That Glitters, which provides exposure to gold, silver, palladium and platinum. This thematic approach to investing is similar to Motif, which also provides users exposure to baskets of stocks and ETFs that are part of a single theme. Unlike Motif, which requires greater user involvement, Stash simply renames ETFs to make it intuitive to know where your money is invested.
Stash is both an educational and social investing tool that allows users learn how to build portfolios and share investment selections with their networks, including those on Facebook.
The Stash app is essentially a tool that makes it easy for investors to learn as they go. Stash defines financial terms and provides descriptive content to easily explain concepts in an easy-to-user interface.
Stash also allows users to engage their social networks by linking to contacts and sharing investment selections while maintaining privacy of unique data, such as portfolio value and amounts invested.
Users are encouraged to invest more money by simply moving sliders within the app that manages monthly deposit levels, projected investment gains and growth opportunities. You can easily view how depositing money each month as well as changes in monthly performance can affect the long-term value of your account after 1, 5 and 10 years.
Stash makes it easy to connect to a bank account. A feature users should pay close attention to is that fees are withdrawn from that linked bank account not the invested portfolio. This is less of an issue for those with account sizes under $5,000 (who are charged $1 per month) but more so for those with account sizes of $5,000 and above, who are charged 0.25% of assets. For example, on a $100,000 portfolio, fees of 0.25% annually amount to $250 so bank account balances will experience consistent fee drawdowns which poses a risk of overdraft to accounts with low balances.
Stash Pros and Cons
Stash is a great tool for beginner investors as well as those wanting to learn how to build a portfolio that is suitable for their risk and reward goals. Stash caters to clients with low account balances. Stash makes money by charging a monthly fee on amounts up to $5,000 and % of assets thereover. Taxable and Roth IRA accounts are supported and portfolios are not managed automatically as they are with robo-advisory firms so Stash can be thought of as a virtual advisor capable of spotting portfolio inefficiencies but users must ultimately make the trades.
|Stash Pros||Stash Cons|
|✅ Mobile App: Stash is first and foremost a mobile app. While it’s possible to sign up on the StashInvest website, most everything else takes place on the app which is both Apple and Android compatible and very easy to use.||❌ Fees: Fees are comparatively high for Stash given that it doesn’t automatically manage your portfolio as a robo-advisor does. Although on an absolute basis, $1 per month is low, on a comparative basis the fees are high as a % of assets invested, especially when evaluated next to Betterment, Wealthfront and other robo-advisory firms.|
|✅ Educational Content: Stash makes it easy for beginner investors to learn the basics of how to build a diversified portfolio, identify expense ratios, and easily invest monthly to maximize the likelihood of reaching retirement goals.||❌ Expenses: Expenses are quite high at Stash compared to what is available elsewhere, such as at Vanguard. Expenses on average are 0.36% and range from 0.10% to 0.70%.
By way of comparison, Schwab Intelligent Portfolios has no management fees for managing a portfolio and expense ratios are limited to 0.24% at the high end.
|✅ Social Connectivity: With Stash, it’s easy to connect to Facebook and share investment selections with contacts, though data regarding balances, portfolio value and amounts invested remain private and hidden from your social network.||❌ Limited Account Choice: Stash only caters to taxable and Roth IRA accounts so if you are looking for 401(k)s consider Blooom.|
|✅ Thematic Investments: Stash makes it easy for mission-driven investors to align their portfolio selections with their philosophies. Investors who are environmentally friendly can choose to invest in renewable energy companies while those who favor travel, leisure and entertainment can easily invest in thematically aligned funds.|
|✅ Easy To Use Interface: Stash has friendly, intuitive navigation in-app, such as sliders that automatically update long-term account value performance and growth potential when additional deposits are made monthly.|
Stash Fees & Minimums
Stash has a low account minimum of $5 but relatively high expense ratios compared to many robo-advisors, such as Betterment. Its fees are low on an absolute basis for account sizes under $5,000 but add up to a high % fee of assets, particularly given that Stash doesn’t actually manage the portfolio.
|Account Management Fees||$1 per month (accounts < $5,000)
0.25% annually (for accounts $5,000 and above)
|Investment Expense Ratio||0.10% – 0.70%|
|Annual, Transfer, Closing Fees||None|
|Insufficient Funds Fee||$30|
Stash is limited in the accounts it supports, currently no retirement accounts and only taxable brokerage accounts.
|Taxable / Brokerage||YES|
Stash is an excellent choice for beginner investors keen to take control of their nest-eggs over time and wanting a helping hand at the start to learn how to build a diversified portfolio, assess expense ratios, and don’t mind paying a premium to accelerate their learning journey.
For hands-off investors who are less keen on the proactive or self-directed approach, robo-advisory firms may be a better choice.