I have been struggling with ideas to help learners understand the importance of saving and investing. Like so many Americans, I am not sure about how the stock market works, and how you invest, and etc. Plus, I don't have a whole bunch of spare money lying around. But, I recently saw a new app called Acorns. It is a way to invest without having a lot of money to invest with - you can start with a small amount, set up to have your change on transactions rounded up and invested, or set-up recurring monthly transfers. For learners (students), the cost is free (for non-learners, it is a $1 a month). I decided that I would try it out to see if it would be something I could use in the classroom.
So, I set it up. I downloaded the app, created an account, answered a few questions about what my savings goals were, and the program created a savings/investment plan for me. I decided that I would invest $35. So I transferred it to my new Acorn account at the end of May. Since then I have watched my $35 grow to be almost $38 dollars and then go back down to $35.43 and today it is at $35.58 (so it is rising again). I don't necessarily understand the ebb and flow and I probably won't become rich from my $35 investment but I can see the educational value of this type of tool that allows learners to be able to participate in the stock market.
I did run across a couple more articles one positive and one cautionary. But as we start to look for ways to teach financial literacy what ideas do you have? Is Acorn a good tool? What other tools do you have?
Brooke
Comments
As a former financial planner, educating newbie investors was always tough. Especially for those that had zero experience or any introduction to investing.
What seemed to help the most was first giving them an introduction to how the stock market works and showing different periods of time of how the market actually performed.
A crucial next step was demonstrating the concept of compounding interest (like the Rule of 72) and how most of the growth starts in the later years. Delayed gratification is a tough concept for many to grasp but showing how investing a small amount (say $100 per month) could grow to a significant amount over time was eye opening for most.
Acorns is a decent investing app but their investment offerings are somewhat limited. One platform I like is Betterment. Mostly because they are very much goal focused in choosing the investment portfolio for you.
They are just one platform of many good ones that exist out there. Most of the best online brokers offer great teaching tools for beginners.
You may also want to check out YouTube. There are a ton of younger creators that do a really good job of educating the masses of the basics to investing. One example. I recently discovered was this 3 hour (yes 3 hours!!) video by Ryan Scribner on Stock Market Investing for beginners. Watch that and it may give you some good ideas.
Good luck!