Money for Nothing

New financial companies help Millennials learn to invest

After coming of age during the worst economic downturn since the Great Depression, many young adults are understandably wary of Wall Street. Notably, a study revealed that over half lack confidence in the stock market as a place to save for retirement. Rather than succumb to skepticism, some investment companies are getting inventive in a bid to win over the largely untapped Millennial market.

040815-1Acorns: Father-son team Walter and Jeff Cruttenden hope to take the intimidation factor out of investing by making it as seamless as swiping a card. Their app, Acorns, rounds purchases made on users’ debit cards up to the next dollar and invests the difference in low-cost exchange-traded funds guided by the Nobel Prize-winning Dr. Harry Markowitz. The process is similar to Bank of America’s Keep the Change program, only for investing rather than savings. Users can join with as little as $5, are never charged fees for having a $0 account balance, and can withdraw funds at any time without incurring a penalty.

040815-2Sumday: By tapping into social sharing, investing service Sumday hopes to change the way Millennials think about saving for the future. Once users connect their bank accounts, they can start transferring money to their Sumday accounts when they see something that inspires them – such as a trip they’d like to take or an outfit they’d like to buy – by tagging posts, pictures and tweets with #Sumday. Their money is then invested in the Dreyfus Basic S&P 500 Stock Index Fund and can be withdrawn at any time. The service is the brainchild of BNY Mellon, one of the world’s largest wealth management companies.

040815-3Society of Grownups: With help from design firm IDEO and insurance company Mass Mutual, Brookline, MA-based Society of Grownups teaches young professionals how to manage their money over chocolate mousse and cappuccino. A “masters program for adulthood,” the organization’s curriculum combines financial classes with supper clubs, guest speakers, and special events to help Millennials achieve a solid fiscal footing that will make their personal goals more attainable. The company hosts affordable Core Financial Classes on critical subjects like investments, debt, and inheritance, and also provides one-on-one counseling with financial planners who can help students leverage their investments to become “the kind of grownup they want to be.”