Frugal Ways to Invest your Change

Frugal Ways to Invest your Change

Every family has one sitting around. Maybe it’s on your dresser, stuffed in your closet, or tucked in the corner of your room. Maybe your kids even have their own. That’s right, I’m talking about a change jar. For years, our family tradition has been to empty our pockets at the end of the day, hang on to the cash, and dump the coins into a jar until it adds up to something meaningful to invest.

My wife and I were talking a while back and we realized that our change jar wasn’t filling up as quickly as it once did. Now that so many of our transactions are card-based, we just don’t have as many coins in our lives. We really enjoyed that fun money so I started to search for an alternative. Luckily, I found a solution that works perfectly for us and as an added bonus, we have actually earned a decent return on our money – something that never would have happened with the money sitting in a jar!

Change jar for the digital world

After doing so much searching, I found a company called Acorns. What they do is extremely simple – each day, they monitor your card-based transactions and round up to the nearest dollar. The amount that is rounded up is invested on your behalf and adds up surprisingly fast over time.

The great thing about Acorns is that it gives you a nice way to get into basic investing without having to learn a lot about the process. Or maybe you already have an investment strategy and just want to set up a little something on the side.

The nitty-gritty

After you create an account by visiting, you’ll need to tell Acorns which bank accounts and credit card accounts you want to monitor and provide credentials to do so. You’ll also need to give them the details and authorization to pull money from a checking account to fund your account. Acorns will then monitor all of your daily transactions and “rounds up” to the nearest dollar by transferring money from your checking account. Once those round ups hit the $5 mark, they are invested on your behalf.

So next time you’re on that family shopping trip and spend $86.79 (wishful thinking, eh?), Acorns will round that up to $87 by investing 21 cents. By default, if you spend an even dollar amount, Acorns will invest $1, but you’re able to change that behavior if it isn’t what you want. Be sure to download their mobile app as well – it offers all of the features of their website.

How does the investing work?

Your investment choices will vary by country, but here in the United States, we have five portfolio choices based on your risk appetite. If you choose conservative, which should in theory be the least risky option, 40% of your money will be placed into government bonds, 20% into corporate bonds, 15% into large caps, and the rest sprinkled between emerging markets, real estates, and small cap stocks.

On the other end of the spectrum, if you choose the aggressive portfolio, slated as the most risk with potentially the most reward, 30% of your money will be invested in real estate, 25% into small cap stocks, and 20% into emerging market stocks, with the remainder in large cap, corporates, and government bonds. There are three choices in between and you can change your mind at any time. Dividends are automatically reinvested for you, so you’ll be compounding your earnings in no time. Most of the investing is done through Exchange Traded Funds (ETFs) and Acorns allows you to purchase partial shares, which is why you can invest so little at one time.

Take a look at the image below to see a sample of potential investment growth over time. Acorns has a tool you can use to see your potential returns based on amount invested, amount of time, and risk profile.

An ETF is an investment fund that is traded on an exchange like a stock would be. The interesting part is that these ETFs can hold stocks, bonds, or commodities and most track an index. One benefit to many of the popular ETFs that Acorns trades is the low cost compared to many traditional investment vehicles. The other major benefit is that it allows you to invest in a single investment while the underlying assets are automatically diversified, which reduces risk.

There are risks with any investment, but these portfolios benefit from spreading the risk out over several market segments, so if one has trouble, the others could hold up your investment value.


You have the ability to put additional money in or pull your money out at any time. As with withdrawals in any investment, it will take a few days to get your money. This can also benefit you if you are impulse spender. The money is available quickly but not instantly. As with any investment product, gains are taxable and you should consult your accountant if you have any questions. Deposits are as simple as putting in an amount, confirming, and they will be pulled from your connected checking account that is normally used for funding.


Ah, the downside to any program – fees! You can’t expect them to give everything away for free I suppose, and they don’t. The standard fee is $1 per month. Though not considered expensive by any means, it is something to consider if you’re only investing, say $10-$20/month. Once you exceed a portfolio value of $5,000, the fee is 0.25% annually. Still could be a very nice deal, considering many brokerages charge several dollars or more per trade. Plus, this is something you don’t ever have to think about!


Now that you’ve considered the fees, it is worth mentioning that there is a way to offset them. Called “Found Money”, Acorns launched a program recently that allows you incentives to shop with their partners. Now, it might not be wise, financially speaking, to go out of your way to buy something just to save money, but some of the vendors might be ones you already use.

A good example is Zappos – buy from them with a card connected to your account and they’ll invest 3% of your purchase price on your behalf. Please note – there are two different ways they’ll give you money, both of which are clearly labeled in the app. For some retailers, like Walmart, you have to click through the app to get the benefit. On others, such as Zappos, you just have to spend the money on a connected account. Don’t forget to check before you buy!

Final thoughts

Chances are that this isn’t going to be your primary investment method, but it is a great way to save some extra money for a rainy day fund or even toward a big vacation or purchase. The reason I love it so much is that you don’t have to think about it at all after it is setup. So go out and give it a shot – check back every now and then to see how you’re progressing toward your savings goals! Your family will thank you. I’d love to hear your experiences, so feel free to leave a comment below to let me know how it is working for you.


I’m an Acorns user and by signing up through my Acorns Referral Link, I will earn $10, but so will you! By following this referral link, you get a leg up on investing with $5 deposited in your account automatically as soon as you make your first investment. Also, I am not an accountant or financial advisor, and am in no way qualified to give legal or financial advice so take what I say with a grain of salt 🙂

1 comment

Wow, great information! I’m so glad you shared this because I did not know it existed. I am definitely going to give it a try, because it appears once I set it up it takes care of everything else. Nice way to put my “digital change” to work!


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