Stockpile Review | Investing Made Easy

Joseph Meyer
Written by
Last update:

Stockpile Review

Is This The Easiest Way To Invest?

About Stockpile

Wouldn’t it be nice if you could make your savings work for you? Stockpile lets you invest using a mobile app, without any of the big bank fees.

Stockpile is a company that makes investing easy. Gone are the days when you had to visit your bank, wait in line for an hour, and then fill out a form with your personal information and financial details.

Today, the Stockpile mobile app makes it easy to buy stocks directly from your smartphone, so you don’t have to wait for your big bank to do it for you. Share your Stockpile investment account with your family, friends, coworkers and other like-minded individuals and invest together on one platform.

What Stockpile Has to Offer

Stockpile is a mobile app that offers commission-free investments in ETFs. Stockpile is not investing in individual stocks. It’s investing in a basket of stocks, using an exchange-traded-fund (ETF), which represents an entire index.

An ETF is an investment instrument that tracks a basket of stocks in a specific index. Instead of buying stock of a specific company, you invest in a group of stocks that together represents a certain sector. For example, you could buy into the technology sector using the Technology Select Sector SPDR ETF (XLK), which is one of the most popular ETFs on the market today.

ETFs are a great way to diversify a portfolio. It’s not just about buying one stock. It’s about getting exposure to a certain sector and leaving the rest to the investor’s discretion. An important thing to keep in mind is not to put all your eggs in one basket. Stick to index ETFs to diversify your portfolio across various sectors and industries.

Fractional Shares

Most people invest money, but not everyone is able to invest in mutual funds. Stockpile is an investment tool that allows you to invest in fractional shares. The team at Stockpile also work to make investing even better by providing a user-friendly and mobile-friendly experience. Instead of having to log in to your stock or mutual fund account in order to make a trade, you can use the StockPile app to make a trade on the go. The mobile experience is nice and clean, and users can use the app to participate in a formal trading platform.

Stockpile Gift Cards

How much do you spend in a year? Take a moment to think about it. The more I thought about it, the more nervous I got. I knew exactly how much I spent, month-to-month, year-to-year. Yet I never budgeted it. I never really thought about it. I just let it happen.

Key Considerations

Remember, stockpiling is just a tool for your financial independence. It’s not a be all end all solution. But it can help you retire early at a young age and much better off than most people.

So before we dive into the nitty-gritty of building a stockpile, I want to simply lay out a couple of questions you need to ask yourself before you build your own stockpile.

Do you have a post-tax emergency fund?

If your answer is no, you need to work on building your emergency fund and plan for an emergency before you build your stockpile.

Do you have a budget?

If your answer is no, you need to work on getting a handle on your monthly household expenses before you build your stockpile.

Are you debt free?

If your answer is no, you need to work on getting to zero debt before you build your stockpile.

Is your income sufficient for your needs?

If your answer is no, you need to work on increasing your income or decreasing your monthly spending needs before you build your stockpile.

Once you’re cashflow positive and have some sort of emergency fund built up for whatever life throws at you, you’re ready to plan for building your stockpile.

Fees

The Good, The Bad, The Infuriatingly Strange

Fee structures are one of the most contentious issues in the robo-advisor world. Wealthfront, which I review favorably in this book, has consistently been a leader among brokers by managing to offer good service and quality investing for 0.25% a year, half of Schwab and Vanguard. Many former users have returned after trying and being disappointed with Personal Capital, the only robo-advisor in the 2% fee category.

Other robo-advisors charge nothing for their services, and it’s a steep fallacy to think you’re avoiding fees by not paying them. Feeless robo-advisors still collect your investment portfolio’s performance and pay your taxes, both of which cost money. You’re just paying these expenses in some other way – but not paying directly and not coordinating your efforts with your overall risk tolerance, asset allocation, and financial planning.

The good news is that you don’t have to pay such fees. You have options. We’re going to explore that nugget of information in the next chapter.

As for you, Personal Capital, I suspect you’ll benefit from following Wealthfront’s lead.

Physical Cards

This is a good way to keep track of inventory if you have a lot of stock that you're trying to keep track of. The runner cards can be placed on the top of each stack of inventory, and when you're doing the shopping, you'll know exactly how many of each item you need without having to count everything yourself.

The pile of cards will be in the middle of the table, and everyone adds their cards into the pile while they're shopping.

The game ends when the pile of cards is empty. Whoever has the most cards or piles of cards wins.

You could also set up this game so if someone takes a particular item, they have to give away one of their cards. For example, if someone takes a diamond, they'd have to give away a diamond card to someone else at the table.

How To Redeem Stockpile Gift Cards

Redeeming Stockpile gift cards from your account dashboard is just as simple as adding your first gift card. All you have to do is:

Log in to your account

{1}. Enter the card´s code number exactly as it appears on your card in the redemption area. Your code will be validated and processed. You can then click on the “redeemed” link.
{2}. Once you’ve redeemed your gift card, a confirmation message will appear on the dashboard. You can download this gift card as a printable PDF right away or save it in the My Gift Cards section within your account.
{3}. If you need to add a new gift card, you will first need to enter the new card´s code number in the redemption area and press the “redeem” button. You can then add the card to your account by pressing the “Save” button.

Stockpile Advantages and Disadvantages

What I love about Stockpile is that it is a much easier and cheaper way to invest in the stock market. They offer you a preassembled ETF portfolio made up of a diversified basket of stocks and bonds. They do the heavy lifting for you by providing a comprehensive online financial education, including financial literacy and financial planning tools. They basically take care of matching a portfolio that’s in line with your financial goals.

For example, the Growth portfolio has stocks that tend to show consistent appreciation in value and are less volatile. They also have a Growth Plus portfolio that is more aggressive (i.e., the stocks in the portfolio are more volatile).

Also, since they sell you a basket of investments, your investment is diversified among many stocks. You will be receiving dividends, of course, but your investment also includes the impact of interest from the bonds in the portfolio. The price of the bonds can fluctuate, too.

The Pros

It cost nothing to set up and start using. Perfect for a busy person who doesn’t have a lot of time to research.

It provides live analysis for over 1000 stocks in the S&P 500 Index, the Dow Jones Industrial Average, and the NASDAQ Composite Index.

It provides informative content and resources for investors and traders of all levels.

The Cons

Stockpile has a big appeal that stems from its fees—or lack thereof. Dollar-cost averaging into a diversified portfolio of no-fee mutual funds would run you about 0.25% with Vanguard or Schwab and 0.15% with Fidelity. Compared with those numbers, Stockpile looks like a no-brainer: 0.0%. But there’s a catch. The fee savings are only good now because the platform is so new, but that’s only because it’s a new platform. When more and more investors flocks to Stockpile, it will have to charge more to cover operational costs.

The Investopedia writer Jonathan Lister thinks, “Eventually, just like a 401(k), management, trading, distribution and administrative costs must be charged, so you can expect to pay more for services like tax-loss harvesting. And when that happens, StockPile may not be such a great deal.”

Some investors are also concerned about the company’s cash flow problem. It burned through millions in 2015 and 2016 to grow its company and subscriber base. But its cash flow is turning positive in 2017.

Bottom Line

If you’re in the market for a robo advisor, Stockpile is a great choice. Particularly if you’re a young investor just starting out. Stockpile makes it easy to start saving and investing with no account minimums. And there are no annual fees or trading fees.

If you’re new to investing, their bite-size lessons and online resources are great teaching tools. You can also set up goals, including an emergency fund and even a savings plan for your next vacation. Best of all, once you’ve achieved your financial goals you can get your money back and use it for something else.