How Does Stash Work

How Does Stash Work? The ability to put money aside is critical if you want to achieve your long-term financial objectives. While saving money is important, it’s not the only thing you should do with it. Some of your cash should be placed in investments that have the potential to produce a healthy return on your investment. This is especially true if you plan on retiring early and need a sizable nest fund to do so.

There are a number of apps and tools available that make building wealth a lot simpler than it formerly was. Stash is one of these tools. One dollar may be invested in the stock market, and you can learn about investing in order to make better educated decisions.

It is possible to develop a portfolio with Stash even if you are a newbie investor, thanks to its user-friendly investment tools and instructional resources.4 Unlike many other side hustles, Stash doesn’t need you to put in any effort. Instead, it teaches you how to put your money to work for you by investing in assets that may provide a profit.

Stash – What Is It?

Stash was founded in 2015 with the objective of making financial opportunity more accessible to everyone in the United States so that they may expand their wealth via investment. Since its founding in 2011, the firm has been led by CEO Brandon Krieg and President Ed Robinson.

Both Kreig and Robinson had a lot of experience prior to joining Stash. For more than two decades, Kreig has worked in the financial technology sector, where he co-founded the electronic trade execution firm EdgeTrade. Robinson, on the other hand, is a veteran of Australia’s largest investment bank, Macquarie Securities Group.

Stash’s user base surpassed one million in August 2017. In June 2017, retirement accounts1 were introduced, and in January 2018, custodial accounts2 were introduced. More than four million people have signed up for a Stash account, and those who do so save an average of $1,4329 a year using the automatic investment program.

How does Stash work?

To make money, you may establish a taxable account with Stash and start investing your money in the stock market. Debit cards that give incentives in the form of stocks or mutual funds are also available. Because the features and costs of various Stash products vary, it’s critical to learn about them all before making a decision.

Stash debit card

If you create a Stash bank account, you’ll be able to use the Stash debit card. Maintaining this account is free of monthly fees, overdraft charges, a minimum balance requirement, or fees for direct deposits, ACH transfers from other banks, or for the use of your debit card; it also has no minimum balance requirement. Using your card at a non-participating ATM or a teller will cost $2.50, but withdrawing money from one of the more than 19,000 participating ATMs will cost you nothing.

You may earn Stock-BackR incentives at over 11 million locations by using your Stash debit card. You may get at least 0.125 percent Stock-BackR for every dollar you spend at participating businesses on petrol, groceries, restaurants, or any other transaction. Additionally, you may be eligible for Stock-BackR benefits, which may pay up to 5% back at select retailers.

When you use Stock-BackR incentives, you’re truly getting stock in the firms you’ve already done business with. Reward points may be used to acquire shares in companies like Walmart, Starbucks, and Amazon if you use your Stash debit card at any of these stores. For example, if you buy something from a retailer that isn’t on the Stash platform, such a local shop, you’ll earn Stock-BackR, which will be put in a diversified fund.

To enjoy Stock-BackR when you use your debit card, you must sign up for a Stash membership plan. Starting at $1 a month, there are three Stash membership levels to choose from. Stash debit cards are a convenient method to increase your investment account balances fast and easily if you’re already investing in a Stash plan.

Stash investments

A software called Stash lets you start investing with only $1 and grow your holdings in stocks, bonds, and exchange-traded funds over time (ETFs). There are three Stash investing accounts to select from:

  • Stash Beginner. A personal investing account is included in this plan, which costs $1 per month.4 You may also earn Stock-BackR with this account, as well as financial education for new investors.
  • Growth. Personal investment and retirement investment accounts are included in this $3-per-month4 intermediate account. Traditional or Roth IRA (Individual Retirement Account)1 options are available to you, and Stash will assist you in choosing the optimal account type for your needs. As with Stash’s less expensive alternative, you may also earn Stock-BackR from the debit account and receive financial education.
  • Stash+. It includes a personal investment account, a retirement account, and a custodial account for up to two children. 2 In addition to monthly market insight reports, the service costs $9 per month and includes financial education. This plan also allows you to earn Stock-BackR; in fact, you get twice as much as you would with the Beginner account’s Stock-BackR and a metal debit card instead of a plastic one.

If you want to buy fractional stock shares, you may do so through any of these options, which allow you to choose how to finance your accounts.

  • Investing on a set schedule. In order to save money, you can set up automated bank transactions.
  • Round-ups. Your debit card purchases are rounded up to the nearest dollar, and the “spare change” is invested for you.
  • Smart Portfolios. Stash’s Smart Portfolios will be available to anyone who selects the Growth or Stash+ investment levels. Investing is easier when you don’t have to make all of the decisions yourself. In addition to rebalancing your portfolio and reinvesting your profits, Stash may also perform these other tasks for you.

Investing in stocks, bonds, or ETFs6 from Stash’s extensive range of companies and funds is as simple as transferring your assets into your Stash investing account. When you open an account, Stash asks you a few questions about your financial situation, and then provides you with a list of investing alternatives based on your answers. You may accept as much or as little of that advice as you choose, so you can take all of the recommendations or none at all.

Who is eligible to open a Stash account?

To open a Stash investment account, you’ll need to have the following things:

  • In the United States, you’ve got a bank account.
  • An SSN has been assigned to you.
  • You’re a US citizen, a Green Card holder, or a visa holder with a specific type of visa.

Simple as downloading the app, signing up for an account, and picking a Stash plan. A few easy questions regarding your investment portfolio and risk tolerance are also required, as well as Stash’s fees, which start at $1 per month for the basic plan.

Stash account, on the other hand, may not be appropriate for all investors. At a minimum, you must contribute $3 each month to maintain a personal investing account and a retirement account. There are other budget online brokers that don’t charge you a monthly fee for an account, but you can’t usually buy fractional shares with them and you won’t get the counseling that Stash gives.

For those who want a more hands-off approach to investing, robo-advisors may be a better option. Wealthfront is an example of a robo-advisor. Make an informed decision on which method best suits your needs by comparing Stash vs. Wealthfront in our comparison.
Robo-advisors incur fees, although these are often a proportion of the money you put into your portfolio. Stock-BackR and round-ups, for example, aren’t included in their service.

Do you know how much money you can make using Stash?

With Stash, your earnings are entirely up to you. In general, the more money you put in, the more money you can make. Investing entails risk, as we all know. While your assets have the potential to increase in value over time, they also have the potential to decrease in value.

An average of $1,4329 is saved by Stash members each year by using the company’s products. It’s possible to save more than $135,000 over the course of 30 years if you invest that money every year in a tax-deferred account. However, if you invested the same amount and received the same return, you could save the same amount of money from any online brokerage account or robo-advisor.

Using Stash to make money

With Stash, maximizing your revenue is a cinch. If you’re able to:

  • In order to earn more Stock-BackR, you’ll use your debit card more regularly, especially if you frequently spend at retailers that provide an additional 5% back.
  • You’re a smart shopper. Stock and mutual fund returns are never guaranteed, and investors can always lose money. You may, however, boost your returns by investing in businesses or ETFs6 that perform well.
  • You increase your investment, and then leave it alone. The more you invest in the market, the more money you may make (or lose). In the long run, if your investments perform well, you may amass a sizable nest egg through regular payments to Stash and a substantial portfolio.

In addition to improving your ability to choose assets and develop a diverse portfolio, using software like Stash Learn can help you earn more while taking on less risk.

Money from Stash: Withdrawal Instructions

Approximately 48 hours after selling an investment on Stash, the money will be deposited into your Stash account. Login to Stash through mobile or desktop and pick the Transfer option to transfer funds to a connected bank account. Next, you enter the amount of money you want to transfer and where you want to send it. It is as simple as clicking Continue or Confirm and transferring funds. Your bank account should be credited shortly after that.

How to stay safe

For novices, Stash attempts to make investing as simple and risk-free as possible, but there is always a chance of losing money when you invest. A well-diversified and well-understood asset allocation strategy can help to mitigate the risk of investing losses. You should never invest in something you don’t understand.

A financial advisor may be able to help you if you have more complex financial objectives or needs.

About the author: David Krug is the CEO & President of bankovia. He’s a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he’s not reading about cryptocurrencies, he’s researching the latest personal finance software.