Financial planners and advisors typically encourage investments, but understanding what and how much to invest isn’t always straightforward. Additionally, if you’re not well-versed in financial matters or lack familiarity with the stock market, investing could be daunting, given the risk of potential loss. Even With some investment knowledge, sometimes the expense of some stocks is too high for you to manage. That’s where Stockpile steps in.
Stockpile is a digital stock marketplace that allows you to buy portions of stocks rather than whole shares, opening investment opportunities for those with limited disposable income. Stockpile simplifies stock purchasing by offering gift cards and a mobile app, bypassing broker fees and offering the option to gift stocks to others. With just some basic details, a linked bank account, and a profile creation, you can buy, sell, trade, and monitor your stocks in one convenient location.
Stockpile also offers short lessons in investments for those new to the world of stocks. With Stockpile, you can choose from a wide array of well-known companies to invest in. Despite concerns of using an app for investing, Stockpile assures users of data safety through encryption, offering member protection up to $500,000.
The cost of using Stockpile depends on you as it allows for gift cards and stock purchases ranging from $1 to $1000. However, additional charges include a $1.99 fee for gift cards up to a $100 as well as a $1.99 fee plus 3% of the card value for purchases above $100. Trading stocks comes with a 99 cent fee, but bank transfers are free with no minimum restrictions before transfer. When transferring your account to another broker, a $75 fee applies. Overall, the fees associated with Stockpile are relatively low.
STOCKPILE PROS AND CONS
PRO: USER-FRIENDLY
One of Stockpile’s greatest advantages is how user-friendly it is for people new to investing. In comparison to other digital brokers, Stockpile is one of the easiest platforms to navigate.
CON: PURCHASE LIMIT
For those interested in buying a significant amount of a successful stock, Stockpile may not be the right choice because it enforces purchase limits.
PRO: NO MINIMUM BALANCE
Unlike many programs, Stockpile does not enforce a minimum balance for bank transfers or account sign-ups.
CON: COST OF PHYSICAL CARD
Purchasing a gift card entails additional costs, which can be as high as a 20% commission in many cases.
PRO: FRACTION PURCHASES AVAILABLE
For those unable to invest considerable amounts in the stock market, Stockpile enables the purchase of fractional shares, making investment more accessible.
Stockpile faces competition from similar services such as Robinhood and Stash that allow online stock trading. Both Stash and Stockpile allow you to buy fractional stocks and ETFs but vary in costs. Stash charges users $1 monthly until their account reaches $5,000, after which a 25% fee applies to the balance.
Robinhood allows you to buy shares and ETFs but unlike Stockpile and Stash, it does not charge any commissions. However, Robinhood requires the purchase of a full share and offers less investment training. Thus, for beginner investors, it may not be the right fit. One unique feature that neither Stash nor Robinhood offer is Stockpile’s gift card option.
Stockpile might not be ideal for long-term investors seeking to build a robust portfolio. For such goals, investing in a 401(k) or obtaining a brokerage account would be wiser. However, for those wanting to experiment in investing or seeking to start a beginner portfolio, like a gift for a child or teenager, Stockpile offers a suitable alternative.
