what is a micro investing platform 
a micro investing platform is an application that allows users to regularly save small sums of money micro investing platforms aim to remove traditional barriers to investing such as brokerage account minimums and encourage people to invest even if they have limited incomes and assets understanding micro investing platformsmicro investing platforms are the digital age equivalent of saving in a jar all the spare change from your purchases and then taking the full jar of change to the bank for example you could sign up for an account with a platform and register your debit card each time you make a purchase the platform rounds up your purchase to the nearest dollar and deposits the difference into an investment account robo advisors such as acorns helped pioneer this concept you are unlikely to notice the extra 0 50 missing from your account when you pay 3 50 for a cappuccino but over time you will notice the growing sum in your brokerage account if you buy that same coffee 20 times a month basically every workday you will have effortlessly invested 10 by the end of the month or 120 by the end of the year of course a better solution would be for you to make your own cappuccinos at home for 0 50 and invest the 3 00 savings per cup and end up with an extra 60 a month and 720 a year to invest but for individuals who don t want to change their behavior micro investing offers a superior alternative to investing nothing at all micro investing makes investing sums as low as a few pennies possible by eliminating per transaction fees and investment minimums consumers don t need to save up 100 for one share of a stock or mutual fund and they don t need to pay a brokerage fee to purchase that share instead they pay the micro investing platform a nominal fee perhaps 1 per month and it invests their money in fractional shares because those fractional shares are in exchange traded funds etf the consumer s investment is diversified across many different stocks and or bonds helping to protect against market swings in a way that investing in a single stock does not even for people who save regularly micro investing platforms can improve their situation saving 50 a month for 10 years in a savings account with 0 interest rate results in 6 000 which actually has less intrinsic value after 10 years since savings accounts usually pay interest at a lower rate than inflation investing 49 a month after the 1 platform fee for 10 years with an average annual return of 7 however results in 8 580 before taxes and inflation special considerationsautomatic investment is not a required feature of a micro investing platform the ability to invest very small amounts of money is to that end some micro investing platforms aim to help users to not only get in the habit of saving and investing but also to learn about investing the platform might teach them how to choose an etf based on their goals risk tolerance interests and beliefs for example a notable micro investing platform is acorns inc which automatically invests a user s spare change through a smartphone app 1 micro investing platforms must register with the securities and exchange commission sec as a registered investment advisor ria and as a broker dealer 2 3 