Dwayne ‘The Rock’ Johnson is Investing in This Money App That Wants to Help You Save and Invest
Seven dollars can go a lot farther than you may think, thanks to the power of compound interest. If you set aside just $7 a week — or, $1 a day — for your kid starting when they’re born, it could grow to over $800,000 by the time they retire, assuming an 8% annual rate of return.
That’s why investing app Acorns and actor Dwayne ‘The Rock’ Johnson, who recently partnered with the company, are encouraging parents to use Acorns Early, an investment account you can open for your kids when they’re born. Those who opened an Acorns Early account before Labor Day (September 7, 2020) got a free $7 invested into their account.
Why $7? It’s the amount of money Johnson had to his name after he was cut from the Canadian Football League and left jobless in his early 20s.
“Especially this year, there are numerous people feeling as I did when I was jobless with just $7 dollars in my pocket — anxious and uncertain about my life and future,” the movie star said in a statement, adding: “The truth is, it doesn’t matter how small you start. Together with Acorns, we can strive to make saving for the next generation a reality for everyone.”
As Johnson emphasizes, you don’t need a lot of money to invest. Micro-investing apps like Acorns make it incredibly easy to put your money to work — and the best part is, you can make it automatic, meaning you can set up daily, weekly or monthly deposits into your investment account and let your money grow effortlessly.
You can even invest your “spare change” with Acorns using the round-up feature, which rounds up your purchases to the nearest dollar and automatically puts your coins to work.
Investing your “change” might not sound significant but, trust me, setting aside small amounts of money consistently can add up over time. That’s the whole idea behind what I call “The Latte Factor,” which says that if you ditch your $5 latte every morning — or any small luxury you indulge in on a regular basis like a breakfast pastry or soft drinks — and invest that money, over the course of a few decades, you’d have a small fortune.
But don’t take my word for it. Let’s do some math: Say you freed up $5 a day, which is $35 a week or about $150 a month. If you invested $150 a month and earned a 10% average annual return, you’d have $30,727 after 10 years. In 30 years, it would grow to $339,073. And after 40 years, you’d have nearly $1 million.
The key here is that you’re not just saving small amounts of money — you’re investing it and taking advantage of compound interest. Acorns makes it incredibly easy to take small amounts of money and put it automatically into a diversified portfolio of ETFs.
If you have kids, start teaching them about the miracle of compound interest. Even better, open an investment account for them. If you want to open an Acorns Early account, you have to sign up for the Acorns Family plan, which costs $5 per month. It comes with access to its investment, retirement and checking accounts (Acorns Invest, Acorns Later and Acorns Spend), plus you’ll get financial literacy resources that’ll help you manage your family’s money. The Acorns Early account is a UGMA (Uniform Gifts to Minors Act) account, meaning you can use the funds for anything that benefits your kid and it can be easily transferred to them when they’re grown.
I’m opening an account for my son James, so he can understand how investing and compounding works. I recommend you do the same for your kids. It’ll help set them up for a healthy financial future.
Of course, when it comes to investing, there’s always risk involved. The stock market goes up and down, especially during a turbulent year like 2020, and I can’t promise you that your investment value will rise. But the way I see it, there’s a much bigger risk involved if you DON’T start investing today.
*Important disclosure: I am biased about this campaign. I love what Acorns does. They have made investing so simple you can be up and investing small amounts of money automatically in minutes. They have truly made my Latte Factor so easy that anyone can get started saving their change and small amounts of money in minutes! I invested in Acorns as an angel investor back in 2014 because I believe in this company and what it’s doing. Today, Acorns has over 8 million accounts. I really think you should look at the “It Begins With $7” campaign with The Rock and get your kids started today. They will thank you later.