Robinhood Review – Are Free Trades Too Good To Be True?

by Lucy Oake on December 14, 2018
This post may contain affiliate links. Please read my disclosure for more information.

Robinhood Review

Robinhood Review

I’m a huge fan of apps that make financial management and investing easier. And there is no shortage of awesome apps out there! If you open Google Play or the App Store and search “Invest” or “Finance,” you’ll be met with hundreds of results.

So how can you decide? Let me help you out.

For someone just starting out with investing, Robinhood might just be the perfect choice. It’s also surprisingly affordable. They have no commission fees on stocks and ETFs, so getting started is both easy and cheap. 

Want to learn more? Keep reading as we did into the app in our Robinhood review.

How does Robinhood work?

Robinhood is a commission-free investment platform that has one of the sleekest app designs out there. You can sign up for a free account and link to your existing bank account in less than 10 minutes. It takes a few business days to get your bank account fully synced, but after that, you can set up one-time or recurring transfers.

Simply search for a specific stock you’d like to buy, or add stocks to your watch list to monitor and buy later. Review a stock, decide how much you’d like to buy, and with a click of a button, your trade gets executed.

And the best part – each trade is free!

What I Like About Robinhood

I recommend Robinhood to my friends because they have $0 commissions and no account minimum. Like the Robinhood app creators, I believe that investing should be accessible to everyone – regardless of their salary or bank account.

I also like that Robinhood gives me access to invest in a wide variety of stocks and ETFs. Platforms like Stash operate similarly but don’t usually allow you to invest in just a single stock at a time.

I also love that Robinhood is straightforward and simple. This isn’t your parents’ investing platform! You can manage your trades right from your smartphone, and the user face is refreshingly easy to navigate.

Sign Up For Robinhood

What Types of Accounts Are Offered

Robinhood offers only individual taxable accounts. Currently, they don’t offer the option to open an IRA or any other tax-advantaged retirement accounts. If you’re looking for the same ease of use in an app that does offer IRAs, check out Stash or Acorns.

For the best tax benefits, make sure that you are investing in some kind of tax-advantaged retirement account before investing through a standard brokerage account like the kind offered by Robinhood.

Robinhood Checking and Savings

Robin just announced new checking and savings accounts. And do you want to know the best part? They are offering 3 percent on your money. That means if you keep $8,000 in the bank over the year, you will earn $240.

This blows every bank out of the water.

Plus, the Robinhood checking and savings accounts have no monthly fees, no minimum balance, no overdraft fees, and no foreign transaction fees. This is a truly free bank account.

You might be wondering if you’re going to get dinged when you try and get money from an ATM. You won’t. With a Robinhood checking account, you will have access to over 75,000 ATM’s for FREE.

Robinhood App: Any Downsides?

A free-trading app is great for a lot of people, but there are some limitations. For example, Robinhood’s platform doesn’t connect you to every possible investment option out there. If you want to invest in mutual funds or bonds, you’ll have to use a different type of trading platform.

It’s also important to note that while Robinhood doesn’t have an account minimum, you can’t buy partial shares. Other apps like Stash, allow you to invest a certain dollar amount, but with Robinhood, you’ll invest in a number of shares. However, when thinking about your investment strategy, it’s still possible to diversify your investments with whole numbers of shares.

Bottom line: not a big deal.

How does Robinhood make money?

The free version of Robinhood is really, truly free. Robinhood doesn’t charge commissions to any of its users’ trades. Where they make their money is through their premium Robinhood Gold subscription program.

This is a sliding scale that charges users a monthly subscription fee for the benefit of extended-hours trading and margin trading. To qualify for Robinhood Gold, you need to have a minimum account balance of $2,000. But even once you reach that threshold, you may find that the benefits of the Robinhood Gold program aren’t for you. And that’s totally fine – keep trading commission-free as much as you want.

Robinhood App Bonus: Cryptocurrency!

One of the coolest options that the Robinhood app offers is cryptocurrency trading! Yes, it’s true, you too can get in on the craze. There are small order minimums for both Bitcoin and Ethereum, but to my knowledge, there’s no other investment app out there that offers access to cryptocurrency.

When it’s all said and done, Robinhood offers a great platform for simple, straightforward investing that’s also commission free. As long as you’re already set with your long-term retirement investment goals, you should have no problem getting started with Robinhood for a little fun investing. And with access to cryptocurrency, there’s really no other app like it. So get in there and invest away!

Sign up for Robinhood

Sign up now for a free Robinhood account and you will receive one free stock

Click Here

 

How would you like to start investing in stocks without paying fees? #Investing #StockMarket #MakingMoney

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Lucy Oake

Lucy Oake is a business analyst by day and a blogger by night. In her free time, she can be found sipping a drink at a local brewery, hiking the beautiful trails of Northern Minnesota, or competing in a karaoke contest. Her dream is to open and run her own brewery-bakery.

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