Investing? There’s an App for That
Investing in the stock market can seem daunting to people who aren’t familiar with its intricacies. Admittedly, thoughts like “as a college student, I don’t have enough disposable income to invest” and “I wouldn’t even know where to invest if I did have the capital for it” have crossed my own mind. Typically, when I think of the stock market, an image like this come to mind:
However, innovators in financial technology (fintech) have recently revolutionized the way the average person invests. These companies are making investing simple and user-friendly, drawing in Millennial and Gen Z users with their apps and mobile accessibility. They’re combining years of financial expertise with the power of incredible software to create services that help users get results for a fraction of the price of hiring a financial advisor.
Upon downloading the apps, Robinhood and Rubicoin (#client) explain how investing works so that first-time users can understand the value of using the service. Then, the apps create a diversified portfolio that is tailored to the users goals and needs based on the personal information provided. The algorithms make sure that a portfolio of a recent college graduate with an entry level job compared to one of a high-level professional look extremely different (as they should). This is an example portfolio created by Betterment:
The trend of using software to assist in money management has already begun to be adopted by Millennial and Gen Z consumers. “What’s your Venmo username?” is one of the most frequent questions I hear on my college campus, as using the app has become the most popular way to transfer money between students — virtually discontinuing cash exchanges. Since my generation and all the ones to follow have grown up in front of some kind of screen, it’s only logical that we would prefer using an app to manage finances (we use an app for everything else, right?) Fintech companies have recognized this generational shift of trust in technology and acted on it.
Through the creation of these apps, fintech companies have started to level the playing field for people of all socioeconomic backgrounds who are interested in investing. The interfaces make investing feasible for those who may not have large sums of money saved and ready to invest. In fact, the home page of Stash reads “start with just $5, and learn as you go.”
So, if investing is something that seems foreign or scary to you, fear be gone! Innovators are now developing apps that support first-time investors, it’s just about finding the one that works for you. Soon you’ll go from looking like this:
To this:
Happy investing!
