Acorns Later Retirement Account Review - Acorns Roth IRA vs Traditional IRA
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- Опубліковано 3 лип 2024
- 🌰 In today's Acorns Later review we're breaking down the Acorns retirement account and explaining the difference between the Acorns IRA and the Acorns Roth IRA. We'll also briefly discuss the importance of saving for retirement regardless of your age. 🔽🔽🔽
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☑️ Acorns Retirement Account Explained - Timestamps:
0:00 - Intro
0:42 - What is Acorns Later?
1:28 - IRA Explained (Roth IRA vs Traditional IRA)
2:00 - Acorns Traditional IRA explained
3:26 - Acorns Roth IRA explained
4:23 - Acorns SEP IRA
4:52 - Acorns Later Portfolios
6:13 - Who Is Acorns Later For?
7:36 - When Should You Start Saving For Retirement?
❓ What are your thoughts on Acorns Later? Are you saving for retirement?
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★ INVESTING DISCLAIMER: This video, and UA-cam channel, are educational and NOT financial or investing advice. I am not an investing professional nor do I offer suggestions on individual stocks. I share my opinions and experience on investing apps and platforms. Please invest at your own discretion.
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About this video:
In this Acorns app tutorial, Erik from Everyday Investing goes over Acorns Later, the Acorns retirement account. He covers the differences between a Roth IRA vs Traditional IRA and discusses why saving for retirement is never a bad idea.
* Sponsorship Disclaimer:
Today's video is not sponsored and all the opinions expressed in this video are from my own thoughts and experience.
**Affiliate Disclosure:
This video and description contain affiliate links. As an Amazon Associate and an affiliate of other companies, I earn fees from qualifying purchases and referral commissions from qualifying leads and registrations.
If you have any questions about the Acorns traditional IRA vs Roth IRA, feel free to drop me a comment below and I will do my best to answer it as soon as possible!
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Beautiful. Thanks for the information shared.
No problem, I'm glad it was helpful 👍
@@EverydayInvesting Indeed. The only thing I dislike about the Acorns Later is that they chose your IRA based on age and income. However, the IRA status can be changed upon contacting Acorns directly.
Excellent content glad I found your channel
Thanks Terrell, I'm glad it is helpful 👍
Great Content ✅
Bad ass show thank you 🙏
Great videos! I found them to be very beneficial
Hey friend wondering if you can do a comparison of the stash retire vs acorn later video
Hey Shane, thanks for the suggestion. I'll keep that topic in mind and plan to cover the Stash retirement account soon 👍
Can I contribute anytime randomly? Say 10 one week 5 then next? With my additional monthly that I’m doing already?
I have a Roth IRA in Acorns, but I'm not sure if it's worth it, due to the $3, they charge every month. Should I close it, and open an IRA, somewhere else (that does not charge a fee)?
I don’t see the banner anywhere :(
I only can go to my acorns later account by swiping right and contributing money but I don’t see anything about a Roth IRA or traditional ira :(
How does this compare to Fidelity?
I’m trying to decide but I’m still confused
I am new at acorn and currently I'm still confused if do I need to invest for later or just invest for future,
Would this be good for a new investor? And where would you recommend Opening a new Roth IRA at?
Definitely. Especially, if you already have an Acorns non-retirement investing account (or if you plan to have both). In either of those cases, I feel having a Roth IRA with Acorns would make a lot of sense because you would be able to view both your accounts from a single app. Plus, you would also have access to Acorns investing automation tools for both your retirement and non-retirement account.
I personally have my Roth at Vanguard because I opened mine years ago before Acorns offered one. I like Vanguard a lot too but I'd say it's probably not as user-friendly as Acorns for new investors. But whether you have your Roth IRA at Acorns, Vanguard, or another platform, as long as you're saving for retirement that's the most important thing 👍
I really need some clarification on what you said at 3:50 and I’m hoping you can help. You said money I invest in the Roth will be taxed this upcoming year when taxes are filed. Everyone else says it is post tax money that you put in so you don’t pay taxes again.
Can I invest money that I have in my savings account that I have already paid taxes on in the past and not get taxed again?
Hey Ryan, my apologies I mixed up my words a bit. What I meant to say is that Roth IRAs are funded with after-tax dollars, meaning the contributions are not tax-deductible. So you're not taxed on Roth IRA contributions, you just don't receive the tax deductions you would with a regular IRA.
But once you start withdrawing funds (at retirement age), the money is withdrawn tax-free. Conversely, Traditional IRA deposits are generally made with pretax dollars; meaning you usually get a tax deduction on your contribution and instead pay income tax when you withdraw the money from the account during retirement.
Thank you
How long have you had your Acorn account and is it doing good.
Can you pick the stocks that you want to invest in? I notice acorn has pre selected portfolios.
Very late, but no you can’t pick your investments I don’t think.
You can, but you have to pay 9 dollars a month
Just started using acorns but no one really knows much about investing should I try investing in multiple apps or just stick with 1
Can i write off acorns later when i do my taxes?
So I already have a 4O1k throughly by job, would you recommend me having my own individual IRA on the side as well?
Yes I would definitely recommend both if you can. The best advice I've heard is that if your job does any contribution matching on your 401k, contribute up to that amount to your 401k before you contribute to an IRA. That is free money from your employer that you don't want to miss out on. However, once you've contributed up to your employers match, then contributing to an IRA can be beneficial.
One of the benefits of an IRA is that, often times, you have more control over your investments compared to a workplace 401k. Another benefit is that with an IRA you can choose to open up a Roth IRA, giving you tax free growth on both your contributions and appreciation. Many employers do not offer a Roth 401k option, only a traditional 401k option. Hope this helps 👍
@@EverydayInvesting And I believe he can roll his 401k into his IRA if he ever leaves his employment, or use it to open a new IRA account....as you are not limited to a single IRA account (you just can't exceed the maximum total personal contribution for the year)...$6000 per individual at the moment.
I’m 23 and will be 24 in October I want to start investing in my future I’ve had nothing saved up nor I don’t have a 401K my goal is to have money set aside while I get everything together in life at the moment and future. So what would you recommend me doing ?
Which app has the best IRAs stash or acorns?
Either one can be a good choice. Acorns costs $1 less per month. But Stash IRA waives all fees for users under $25. You can also instead choose to open one at places like Vanguard, Fidelity, etc. It's more important to have one rather than where you have it 👍
Which would you choose if you had to the Roth or traditional ?
I have a Roth IRA at another institution. I like the Roth because while you do have to pay taxes upfront you never have to pay taxes on those investments again. When contributing to a Roth you are choosing to pay taxes on your contributions now rather than pay taxes on all your growth (potentially decades down the road). The traditional IRA has it's advantages as well, such as immediate tax breaks, but I like the idea of tax free growth with the Roth 👍
Thanks very for the explanation. Can you lose money in your Acorn later account as you can with the acorn saving account?
Yes you can. The value of your investments will grow as the value of the stocks you invest in grow, but your investments can also decrease in value as the stock market fluctuates down. This is why investing is always best for the long term. In the short term, the stock market can fluctuate up or down but over the long term the stock market has a history of increasing in value 👍
I was trying to open Roth irs . But they arcon the open a traditional irs . How can change that ?
Hey Ozzie, if you contact Acorns customer support they can assist you with that 👍
You put out really great, straight forward content. Thank you, brother! Keep creating
Thanks man, I appreciate it! 👊
Can I choose Roth IRA or will acorns choose the IRA it wants for me ?
In the hypothetical invest projection where it shows how much money you receive as years pass do you get that money or underneath it where it says return
I have a traditional IRA on acorns later but I want a Roth IRA. I only have about $400 in my acorns later, should I withdraw now and take the penalty instead of waiting? I want to open a Roth
You are also allowed to have both a traditional IRA and a Roth IRA. But I would contact Acorns to see what your options are before withdrawing any money from your IRA. They will be able to assist you with this.
Why not keep the $400 in the traditional IRA?
Does Vanguard charge a monthly fee? I know Acorns charges a monthly fee for $2 for acorns later but I am also looking for a roth ira with no fees
Vanguard does not charge a monthly fee for their retirement accounts, and they are definitely a good option as well. The main differences are that the Vanguard's mobile app is not as user-friendly as Acorns, and if you want to invest in stocks or ETFs, you have to buy the full shares. With Acorns you can invest in smaller increments. The Acorns Later account can also make a lot of sense if you already have your other accounts at Acorns and want to consolidate everything in one place. I currently have my Roth IRA at Vanguard, but am considering moving it to M1 Finance for the ability to invest in fractional shares in my retirement account.
Is this a good option at $4 a month???
Hope you can reply to this. Does a rebalance have to occur automatically or can that be optional
Also i hate that there is alot of mixed opinions about this app when most dont save anything at all.
Can I switch from traditional to Roth? I put traditional at first but now I want Roth so can it be switched?
Generally, you can but there are some tax implications. When you convert from a Traditional IRA to a Roth IRA, a process also known as creating a “backdoor” Roth IRA, you generally pay income tax on the contributions you've made to it. The taxable amount that is converted is added to your income taxes and your regular income rate is applied to your total income. With that being said, you may have to contact Acorns to see if they allow this conversion or what options are available to you. I'm sure they can help with this 👍
Everyday Investing Do you know what the Acorns contact information is like the phone number?
Hey Riana. You can create a support ticket from inside your app or from on their website. They also have an 855 number you can call in to. I don't believe I can write phone numbers on here but if you Google search 'acorns support phone number' it will come up.
What is the best if you plan on retiring at 40?
Everyone's situation is different. But tax brackets do factor in. For those who feel they will be in a higher tax bracket now than in retirement, a traditional IRA might make more sense because you can pay taxes later when taxes are lower. For those who feel they will be in a higher tax bracket in retirement than they are now, a Roth IRA might make more sense because you can pay taxes now when you project taxes will be lower.
Is there a limit on how much you can put every month in your Acorns Roth IRA account?
I have it and I think its about $6000 a year before 57
Thank you for this video. Really helped me figure out what Traditional IRA//Roth IRA... still debating which one to go with
No problem Kevin. There is definitely not one perfect solution for everyone. With a Traditional IRA you receive a tax deduction now and pay taxes on all your contributions and growth later. With the Roth IRA you won't get a tax deduction now but will receive tax free growth and never have to pay taxes on all the growth when you withdraw later in retirement. I'm definitely a fan of the Roth, for tax free growth, but it all comes down to personal preference 👍
I have an acorns account and also an acorns later account. I use small reaccuring deposits and round ups for the regular one but can't seem to set up round ups for the acorns later account. Is there anyway to do this, as that is why I was going to use the acorns IRA...to take advantage of the round ups. Any help would be appreciated.
I want to close my Acorns later account and open a Roth IRA with Vanguard, what do you think of this?
Hey Emery. There's nothing wrong with that. It's all just a matter of personal preference. I actually have my Roth IRA at Vanguard as well. Actually the reason I haven't opened an Acorns Later IRA is because I already opened my Vanguard one years ago.
In order to move the money from your Acorns Later account to Vanguard, you will have to do what's called an IRA transfer. If you are interested in this you will need to contact Vanguard and they will be able to assist you with the steps to complete the transfer 👍 But don't withdraw any funds without first contacting Vanguard and having them walk you through the process. Because if you just withdraw (instead of transferring) early withdraw penalties can occur.
Everyday Investing awesome thank you
@@60in3.1 Does Vanguard charge a monthly fee? I know Acorns charges a monthly fee for $2 for acorns later but I am also looking for a roth ira with no fees
@@5raad089 UPDATE: it feels like I posted my original comment years ago lol. I decided to keep my ROTH IRA with Acorns so I'm not sure about Vanguard's fees. I feel happy with my decision so far.
@@EverydayInvesting what penalties are there? I got some hiccups rn and I need the money. Scared it’ll hurt my credit and etc... any info will help
Is there any major differences between opening a Roth IRA with M1 finance vs Acorns? Is one better than the other?
Hey Elion. No, there are no major differences. Both will maintain the same tax benefits, contribution limits, and early withdraw penalties. The only differences I can think of would be that M1 would allow you to customize your IRA portfolio more with individual stocks. Acorns on the other hand would give you access to more investing automation tools to help you save for retirement.
I personally have my Roth at Vanguard because I opened mine years ago before Acorns or M1 offered one. I like Vanguard a lot too but I'd say the platform is probably not as user-friendly as Acorns or M1 Finance. But whether you have your Roth IRA at Acorns, M1 Finance, Vanguard, or another platform, as long as you're saving for retirement that's the most important thing 👍
Great Video! 👍🏻 I was not familiar with Acorns Later and this was a great guide! Keep it up! 👍🏻😎
Thanks man! I see you're creating good stuff as well. Keep it up! 👍
I work at Starbucks and i have a 401k with them, but I've been considering acorns later. Is it a good idea to have two retirement plans?
Hey Ryan, there are no restrictions on how many retirement accounts you can have but the maximum annual contribution you can make to your IRA is the same whether you have 1, 2, or more. I personally don't have an IRA at Acorns because I've had mine at a different institution for several years already. I decided I want to keep my retirement account in one place. But there is also absolutely nothing wrong with having 2 accounts if you like the automation tools of Acorns. Ultimately it depends on what best suits your needs 👍
On a side note, I just realized you were talking about a 401k. So yes I would absolutely recommend opening up a separate IRA in addition to your workplace 401k. They are categorized as different types of retirement accounts so you won't have to worry about combining their annual contribution limits. The more you can save for retirement now the better off you'll be in the long run!
I am so confused
If you already have the option to invest in the core investment without the 59 age minimum then what’s the point of later?
What’s the main difference between the core investment and the IRA investment? With the core investment I can just withdraw my money at any age
Is there any difference in having the basic Acorns account in comparison to their retirement accounts? I dont plan on taking this money out till im retired anyway… do you recommend i leave it the way it is?
Question-Can you just use the investment account for roundups only and make daily contributions into your Ira with acorns?
Could Acorns IRA be used a emergency fund. I know that’s not what Acorns is designed for, but a savings account could be useful.
Hey Chris. It is not recommended to use an IRA or Roth IRA as an emergency fund. The reason is because these are retirement accounts. And while you technically could withdraw funds held in a retirement account for an emergency, there are early withdraw penalties of up to 10% for withdrawing before retirement age.
It is much better to hold your emergency fund in a savings or checking account where you can withdraw it at anytime without penalty. Your IRA should be solely for investing for your future 👍
@@EverydayInvesting my sister-in-law said the very same thing! What do you think of the savings app digit?
Happy Easter!!
Honestly, I have not tried the app digit myself, so I couldn't say. But if it is a savings account then that would be better suited for an emergency fund. Or your traditional bank account could work fine as well too. As an investing account, Acorns is better suited as a compliment to your emergency fund, but not as your emergency fund. Hope that makes sense. Happy Easter!
@@EverydayInvesting believe me it does! Your explanation is much appreciated! Thank you!
Hey so are you legally allowed to have more than one Roth IRA or no?
Hey Jacob. Yes you are allowed to have multiple Roth IRAs. But your annual allowed contribution does not increase for having multiple accounts. You must still stick within the max contribution limits for that year.
Hello sir, what IF I keep investing on acorn until I’m of enough already without getting the retirement plan? Is there any concerns that needs to be worry about because I’ve already had one investment retirement already on my job. Thank you, your answer would be appreciated.
I give you money to be held till retirement & then you charge me $3 every month? No thanks! I would go for Fidelity or Vanguard which is free.
Great video, very straight forward advice. My question is what is the percentage rate on later ??
Thank you, I'm glad it was helpful. Do you mean the percentage rate on your investment return? How much your investments can make over time will depend on number of factors such as how consistently you invest, the investments you choose, how they perform, and for how long you invest.
This is why investing is best for the long term. By investing for the long term, even smaller consistent contributions can be the key to growing your investments over time, as opposed to how much you invest up front. In the short term, the stock market may fluctuate up or down but over the long term the stock market has a history of increasing in value.
Great video! New to investing and my husband has used Acorns and I am now looking into Acorns. Would acorns be best for a regular and Roth IRA if one deposited a couple hundred per month into the roth IRA? My work 401k doesn't have match back, so a Roth IRA is something I've been looking into for a bit but haven't figured out which place I'd want to create my account with.
Super late on this and I hope you are still commenting. I did research and correct me if it wrong please.
So I don’t have a retirement fund and it seems acorn is a good option for beginners that aren’t active investors. (If you have other recommendations for Roth IRA that helps you such as acorn let me know please).
Also the question I wanted to ask, for the Roth IRA, from research it seems to say you do not have to report deposits for income taxes? Is that true.
This was helpful imma just drop this comment, this gentle tap on the like and my hit for the sub button