Is Stash Invest Legit? An Unbiased Review

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Stash Invest - A King in the Investing Landscape

Years ago, investing was a dirty word. It was something you paid someone else to do so you never had to think about it, and it was usually something your dad told you you should be doing, but you had no idea what was happening and where your money was going and...wait...I just paid $20 to purchase one Apple stock? What the fuck?

Now enter, the rise of the "investing app." Thanks to companies like Robinhood, investing now became cheaper, easier and more straightforward for people like you and me that didn't graduate from Wharton or have a dad with the last name "Vanderbilt." Investing all of a sudden became...trendy? YouTube superstars like Graham Stephan and Meet Kevin, along with their shitty thumbnails, were born out of a sudden spike in awareness and general interest in investing. Then, this gave rise to the products to meet that demand, namely, mobile apps that focused on making investing easier.

That's where Stash Invest comes in. Today, I'm going to give you a brief history of the company, the products and services offered, pricing, and finally my verdict on the app. Please note that this review is not sponsored in any way, and I am unaffiliated with Stash in any capacity. Let's get into it.

Related: Investing In Stocks? Start Here.

What Is Stash and Stash Invest?

Great question, me! Stash is a fintech company founded in 2015 that combines investing, custodial accounts and banking products into one investment app that appeals to beginner investors.

Two former Wall Street traders, Ed Robinson and Brandon Krieg, founded the company back in 2015 after they were routinely approached by their peers (keep in mind that these people work in fucking Wall Street) with questions about their investment portfolio. Rather than answer each individual, they did the most 2010's thing they could think of: they started a fintech firm.

What Robinson and Krieg stumbled upon was actually a huge problem in the U.S at the time (and I would argue that it still is), which is the general misconceptions around getting into investing. Do you need a ton of money? Do you need a man in a pinstripe suit who does the secret investing dance and your money goes up or down? After building out their platform and proof of concept, the two left their full-time jobs to pursue Stash.

The company began as a mobile app in the Apple App Store where users could sign up and begin investing with as little as $5 in the first example of fractional share purchasing I can actually remember outside of a DRIP plan. For context, it took investing giant Robinhood until 2019 to get to fractional share trading.

But what are you actually investing that $5 in? And how does investing with Stash compare to investing with Robinhood?

Stash Products and Services

Stash Invest

Let's just get to the big one first: their investing product is awesome. I actually found Stash and Stash Invest at the very beginning of my investing journey back in 2017. To be honest, I barely had two pennies to rub together at the time, so everytime I would put $10 into the program, I would just as soon take it out because I wasn't going to make rent that month. Opening a Stash account back then probably wasn't lining up with my financial goals of "survive and advance" back then.

The interface for Stash is...pretty cool. Even though the investment platform has an overwhelming number of investment options, it's essentially the training wheels version of an investing app. Rather than saying "YOU HAVE $5 IN YOUR ACCOUNT NOW PICK WHERE YOU WANT TO PUT IT, ASSHOLE," it actually provides pretty good overviews of not only individual companies, but exchange-traded funds (ETF's) that are available through the program.

Essentially, this is for that person that says to themselves "I really think that 5G is going to take over the world and I want to invest in it," but they don't actually know who makes 5G products and services. Stash does a good job of taking complex ETF concepts and naming conventions and simplifying them down into "American Innovators" or "Social Media Mania."

For ETF's and individual stocks alike, it gives you a small, fun blurb explaining exactly what it is you're investing in, as well as things like historical performance, expense ratios (where applicable) and ETF holdings. It also denotes how risky the investment vehicle is to ensure that this investment matches your overall risk tolerance.

But let's say you read my article on index funds and decided, because you're a genius, that you want to invest in index funds only. Well, they have those too under the "Broad Market" category, and make it extremely easy to set up recurring investments over time to really grow your compounding interest. And the nice part here? Stash uses fractional shares across the board, meaning you can put any money you have to work, as long as it's over $5.

Stash also suggests ways to diversify your portfolio

If all of this is just really overwhelming and you want the Stash app to do it for you, then you're in luck! At some of their higher subscription tiers (more on that later), they will actually ask you a series of questions to build a well diversified portfolio for you with actively managed asset allocation in a personal portfolio built just for you. All you have to do is set that recurring payment and watch your portfolio grow (hopefully).

What Stash does not have, however, are mutual funds. While I think this is totally fine, others that are used to active mutual fund investing may find a Stash Invest account lacking for their needs.

Related: Why Investing Is Better Than Saving (featuring Compounding Interest!)

Stash Invest Accounts

Here's a leg up on Robinhood that Stash currently has: multiple types of accounts! Where as Robinhood has one account (taxable brokerage account), Stash operates in more of the long-term-oriented retirement account ethos. They include a Roth IRA, Traditional IRA and Custodial Accounts, though they do also have standard taxable brokerage accounts.

While I've covered in-depth the concept of a Roth and Traditional IRA on this site before, a Custodial Account is not something I've done much legwork on. Essentially, a Custodial Account is an account that an adult sets up for a child/children that gives them extremely early access to investing. In short, this is one of the best ways to set your child up for success as their retirement nest-egg could already be pretty well built by the time they get access to the account at 18 years old. A great side effect? You'll also teach your kid that you don't have to be bad with money, setting your child up for the greatest chance to succeed moving forward.

Related: Is a Roth IRA The Best Way to Become A Tax Free Millionaire?

Stash Bank Account

In my previous review of Stash competitor Albert, as well as in my write up on Affirm Holdings and Block, every company in the fintech space is chasing the concept of the "super app." In its simplest terms, a super app is one finance app that does everything, from standard banking features to investing to budgeting and everything in-between. Well, Stash got a leg up on the competition in the super app world when it introduced their banking product back in 2018.

The Stash Debit Card (courtesy of Peter Kim)

Stash Bank is...a debit card. Yes it's also somewhere you can send your direct deposit and track personalized spending insights, but for all intents and purposes, it's a debit card backed by Green Dot Bank, the en vouge banking partner for fintech neo banks. There is one cool feature that I do want to note, however: Stock Back.

Stash Stock-Back® Rewards

Stash Stock-Back is actually a pretty cool feature. Essentially, it's giving you cash-back type rewards, but in a debit card, and with stock.

Take a card like the American Express Blue Cash Preferred Card. That card is an extremely popular in the cash-back community of pencil pushing credit card weirdos because it offers 6% cash back at supermarkets and streaming subscriptions. The Stash debit card is similar, but instead of getting cash back, you get say, Kroger stock, in return, that's then reinvested in the stock market.

Amex Blue Cash Preferred Card (courtesy of The Points Guy)

Why do I like this feature so much? Because you receive stock back from the company you purchase from. If that company also pays dividends, then you're getting a portion of a dividend paying growth stock, for free! That's insane! Pro tip: get your groceries from Target with this card. Target stock compounding over time with dividends makes this the greatest trade deal in the history of trade deals.

Stash Features - Cryptocurrency and Lending

There are a few specific features I want to touch on where I think Stash has a genuine advantage over the competition: Smart Portfolio Cryptocurrency Exposure and Securities Lending.

Smart Portfolio Cryptocurrency Exposure

I touched on the Smart Portfolio feature of Stash Invest a little earlier, but this is an interesting new development. Stash Invest has now introduced cryptocurrency exposure into their Smart Portfolio feature, as of January 2022. "Why now?" you might ask as someone who has either made or lost a life-changing amount of money in cryptocurrency. Turns out, they have a pretty good answer to that:

Here’s the thing, we’re not making the changes based on investment fads, or because we think it’s trendy. Our investment committee thinks that cryptocurrency is now developed enough as an asset class to introduce into Smart Portfolios, just as bonds, gold or other commodities can be smart choices for your total diversification plan. - Stash Invest PR Statement

The piece later goes on to compare Bitcoin and Ethereum to a type of digital-gold inflation hedge (where have readers of this site heard that before?) and it interestingly replaces a portion of the bond allocation in a user's portfolio. Not too many fintech super apps give you automated cryptocurrency exposure, so this is pretty cool to see.

Securities Lending

Securities lending is another feature that users of a brokerage like Robinhood or the like will be unfamiliar with. Securities lending is basically the loaning out of your owned security (stock or bond) to another investor or institution. For the person purchasing the borrowed security, it provides greater liquidity in the market. For the investor that's loaning the actual security, they receive a loan fee for their troubles. It's effectively another form of investing passive income that's locked off to investors on other platforms, which is why Stash and Stash Invest is pretty unique in the marketplace.

What Does Stash Cost?

Back in my day, Stash was one flat monthly subscription fee of $5. However, since I've come back and checked on the service, those rates have changed dramatically. Stash now offers three tiers of subscription: Stash Beginner, Stash Growth and Stash+. My favorite is the Stash+ banner because it has a big "FEATURED" on it which makes sense because it's the most expensive.

Beginner is a pretty low $1 per month. On the McDonalds scale, that's one McDouble. What do you get for one McDouble?

But what if you up that number to three whole McDoubles?

Finally, for nine McDoubles per month, you get the following:

I should also note that there is an additional fee for using Smart Invest, so keep that in mind if you want to go on autopilot.

Is Stash Invest Legit?

Yes, Stash (and Stash Invest) is legit! However, I have one caveat: if you are seeking long-term investing only and don't care about the Bank feature, go with M1 Finance. Why? Because M1 doesn't charge you a monthly fee! M1 is totally free to use if you're investing in individual stocks, and it rivals Stash Invest in the number and type of accounts you can open. They do also have a Bank feature, but it's a bit more expensive and has a varied list of benefits.

Stash Invest is an awesome, awesome product for new investors. If you see investing as some wasteland where you need specific knowledge and a ton of money, then Stash is a phenomenal starting point for you to begin (and maybe continue) your investing journey.

This review was not sponsored by Stash, and the author has no material relationship to Stash or Stash Invest.