There are tons of investment and financial products out there. This is a list of services we use and recommend (with a few notes on ones we don’t, but maybe you would be interested in).
Love a service you don’t see on this list? Let us know – we’d love to check it out and share it with others.
As a disclaimer, some, but not all, of these links are referral links. We note the perks to you when relevant. We feel pretty impartial, notwithstanding our referral links (CIT Bank and Heritage for example provide no incentive to us for recommending them, and they are our top recommendations for savings and checking accounts respectively). We are only human though. ¯\_(ツ)_/¯ If you see a service you think should be listed here, again, please reach out to us and let us know!
Stocks
M1 Finance
M1 allows you to create custom portfolios, with set allocations among assets, and then auto-invests your deposits accordingly – all while charging ZERO fees.
This is very similar to the robo-investors below, but with no fees and with greater control. Maybe you would prefer to follow Nassim Taleb’s Barbell Strategy or maybe you like the Lazy Portfolio‘s popularized by Bogleheads (check out the Coffeehouse portfolio here, for example) – with M1 you can get on board. With traditional robo-investors, you can’t. Heck, with M1 you could just mimic Betterment or Wealthfront’s asset allocations and run it on your own and skip the fees.
Another benefit to M1 is their “Borrow” feature. If you maintain over $10k in a taxable funds, M1 will let you automatically borrow up to 30% of your account value at a rate of 4.25%. Technically it’s a margin account and it if you aren’t careful, it can be playing with fire (if your account value goes down to far, M1 reserves the right to sell off your assets to pay down the debt) – but in the right circumstances, a guaranteed loan can be helpful, particularly if you can maintain a loan-to-account-value ratio of much lower than 30%. If you are dumping a lot of money into a taxable investment account, you might as well get the added value of a low-interest, on-demand loan.
Get $30 when you fund your account with this link.
Robinhood OR SoFi Invest
EITHER platform allows you to buy and sell stocks for ZERO commission. Robinhood has some unique assets not available on M1 Finance for example (cryptocurrency being the main one) – and on either Robinhood or SoFi Invest you are likely to find some traditional brokerage assets not available on M1. Crypto has collapsed, but if you think the market may recover, now would be a prime time to buy.
Robinhood is a no-brainer way of being exposed to that potential upside. If already have a SoFi Money account, getting the SoFi Invest account would be a way to simplify your finances some. Robinhood is purportedly coming out with a cash-management feature sometime soon, but they’ve been a bit delayed after a snafu in their original announcement (promising greater interest rates than they could reasonably deliver apparently).
SoFi Invest’s clear advantage over Robinhood is SoFi claims to offer unlimited over the phone advice, for free. Seems too good to be true, but as we learn more, we’ll update you.
Sign up with this link for Robinhood and get a free stock. There is a 2% probability it will be worth over $200.
Consider also traditional brokerages like:
Charles Schwab
My preferred discount-broker. $5 per trade, good research tools, superb customer service, great banking arm (no ATM fees ever, worldwide).
Vanguard
The juggernaut of low cost index fund investing. Very well regarded.
Robo-Investors
Robo-Investors allow you to simply deposit money and let robots manage it all for you. Much cheaper than human wealth managers and some might argue they are better. At Wealthfront and Betterment, you take a short survey to assess your risk preferences and investing goals and they recommend a plan for you. You then just deposit money and forget about it. We prefer M1 to these platforms, but if M1 is too much micro-managing for you, this is your next best bet.
Wealthfront
A great intro to robo-investing. Get your first $5,000 with Wealthfront managed for free with this link.
Betterment
Similar to Wealthfront but you cannot permanently avoid fees. Use this link and get 90 days managed for free.
Fundrise
Not a robo-investor, but definitely a set-it-and-forget-it option. You give them money and they invest it directly into actual properties around the country. You get a list of the properties and can read about them. Getting your money out isn’t very easy – you have to make a request, and then they disburse the money at some later time (quarterly it appears), and a certain percentage is taken out of your initial investment if you withdraw too early (around 5 years it appears). But maybe you like real estate? Our returns here have been quite high, hovering around 10-12% – we like it. You should also look into REIT funds however. Vanguard, Schwab, and others offer essentially the same thing with greater liquidity and cheap buy-ins.
Astra
Also not a robo-investor – it’s an auto-transfer bot. You can manage all of your account transfer needs from here. In addition to one-time transfers and recurring transfers, you can have “sweep transfers” – so that if a set account gets more than a set amount of money, Astra will auto-transfer the excess to an account of your choosing. Note that they recently sent out a survey asking people how much they would pay for the service. All of the fees seemed ridiculous to me ($0/m for 5 transfers and $500/m limit, $20/m for 10 transfers $2,500/m limit, $100/m for unlimited transfers and $25k/m limit) – but while it’s free, it may be worth it to you.
Consider also:
SigFig
$2,000 minimum investment.
Personal Capital
$100,000 minimum investment.
WealthSimple
Higher fees than either Wealthfront or Betterment.
Acorns
Auto-deposits small amounts from your bank account and invests it.
Wealth Tracking
Personal Capital
A great way to keep track of everything in your investments – it’s free, but tries to get you to sign up for wealth management in very low-key ways. I like the detail it provides.
Status Money
Status Money lets you compare your net wealth, spending and savings habits, credit score, and other financial indicators against national averages, peer groups, etc. It’s not as inherently useful as Personal Capital, but it may be useful to kick you into gear – or serve as a well-earned congratulations depending on your circumstances.
Consider also:
SigFig – very similar to Personal Capital
Mint – not my cup of tea, but some people like it.
Credit Karma – credit score tracking. Recommended, although many credit cards will offer similar services.
YNAB – More of budgeting software, but can be useful in wealth tracking as well.
Checking/Savings Accounts
Checking Account: SoFi Money Hybrid Account – 2.25% interest on all account balances with no minimums, no maintenance requirements, free checks, and unlimited ATM fee refunds (including internationally, with no fees assessed by SoFi (Visa charges 1%, but that’s true also of our old favorite, the Schwab High Yield Checking Account)).
Savings Account: CIT Bank Savings – 2.45% interest on all balances as long as you maintain either $25k in the account or have a $100 monthly direct deposit set up. We recommend maintaining a comfortable cushion of one or two months of expenses in your SoFi account, then putting the rest of your cash needs here.
Consider also:
High Yield Checking Accounts (with account maintenance requirements)
These come in all sorts of varieties and all require debit card transactions. We generally don’t like these because we advocate spending with a high yield cash back card, like the Citibank 2% Cash Back, and so debit card spending typically results in added expenses you wouldn’t otherwise incur, just to maintain a checking account. But if you don’t use credit cards for whatever reason, or you can’t qualify for a highly rewarding one, you may be doing all of your spending on a debit card anyways – in which case, we suggest you take a look at these three:
Highest interest rate: Consumers Credit Union Rewards Checking – up to 5.09% interest on up to $10,000 if you (1) post at least 12 debit card transactions totaling at least $1,600 a month and (2) have $500 in ACH or direct deposits a month.
Highest account maximum: Heritage Bank eCentive Checking Account
3.33% interest on up to $25k if you (1) post 10 debit card transactions a month (statement must show it was a “POS” purchase or withdrawal), (2) have an ACH deposit or payment initiated by a bank other than Heritage once a month, (3) log in to your online portal once a month, (4) receive eStatements (which you are auto-opted-in to).
Decent rate with low requirements: One American Bank’s Kasasa Cash account – 3.5% interest on up to $10k if you enroll in eStatements, post 12 debit transactions of $5 monthly, and log into the online portal each month.
Additional Savings Accounts
Barclays Online Savings
Our next favorite savings account – 2.20% on all balances with no minimum account balance and no maintenance fees. You can create up to 25 different accounts and rename them to whatever you want, willy nilly. We use it to create all sorts of different savings goals that are easily monitored. It may not be the highest interest rate around, but the ability to create unique savings goals you can rename on the fly, without any account minimums, makes this a great choice.
6% Interest Savings Account
This account with Digital Federal Credit Union has a low account maximum (just $1k), but if you are starting out on the savings journey from scratch, this is a no brainer. No real hoops to jump through (unlike the 5% accounts below).
5% Interest Checking Accounts
There are a variety of platforms to earn 5% interest on cash – but they all have very low maximum deposit amounts and a lot of hoops to jump through. For us, the process requires more micro-managing than we would like, but it may make sense for you. Read more at this blog.
Budgeting
YNAB
Budgeting software. It increased our founder’s net wealth at least 4x when he started using it many years ago. We highly recommend this software. Use this link and get a 34 day trial plus a month free on a paid subscription.
Credit Cards
Opinions on credit card rewards programs are abundant. Here is ours: stick with one great cash back card for almost everything. If you have other frequent spending and can snag a great cash back card on that, do it. But be careful of redemption programs – you are likely to end up spending money you wouldn’t otherwise spend.
Also, we mostly avoid cards with fees. If you ever stop using a card, you’ll either need to close the account or stomach the fee. There are good reasons to maintain credit cards with very minimal spending (it adds to available credit, has positive impacts on credit utilization, and increases chances of no-hard-credit-check-credit line increases), and if you close a card you forfeit those benefits. We suspect also that having to pay a fee on a card has a psychological impact: you may be more likely to spend on a card with a fee, because you’ll want to “get your money’s worth.” Both outcomes are subpar in our view.
Below are our recommendations for certain niches in our spending. Have your own favorite card, let us know!
Main Cash Back Cards
Citibank 2% Cash Back OR PayPal 2% Cash Back
These are both no-brainer cash back cards. No annual fee, no tiers, no rotating categories to forget, no limits, no confusing or time-draining redemption options to sort through. Just pure 2% cash back on ever purchase ever. Get one of them. PayPal’s card requires you to have a PayPal account, but that’s an easy hoop with real benefits if you don’t already have a PayPal account.
Capital One Quicksilver 1.5% Cash Back
When you travel, use this card. It charges no foreign transaction fees, so while you get a bit less cash back per purchase, you make up for it in avoided fees. Be careful however – the card linked here has no annual fee. Capital One has a lower-tiered Quicksilver card that requires an annual fee – avoid that option if you can.
Alliant 2.5% Cash Back (3% in first year) ($59 annual fee)
If you spend more than $11,800 annually, you may want to opt for this card over the 2% cash back with no annual fee cards below. It provides a 3% cash back first year bonus. We typically prefer cards with no annual fee because new cards come out from year to year, and if you “retire” an annual fee card, you either keep paying the fee or close the account – either of which impacts your finances (with fees, or changes to your credit utilization which impacts your credit score). So, those are complications you’ll want to weigh, but this is a great option if your annual spend is high enough, and the fee isn’t all that pricey. Some people report needing to open a separate checking account with Alliant to secure the card – we have not opened any accounts with Alliant yet, so if you can confirm or deny this requirement, please let us know.
One bonus on this card is zero-foreign transaction fees, just like our favorite card for travel: the Capital One Quicksilver. So the Alliant could consolidate all of the spending you might normally do on both the Citibank 2% (which has foreign transaction fees) and the Capital One 1.5% (which waives all foreign transaction fees), all at a higher cash-back rate overall. A great deal in our eyes!
Specialty Spending Cards
Amazon Prime 5% Cash Back
If you have a prime account, this is another no-brainer. Plus, we prefer the way this card reports Amazon purchases (when compared to a normal credit card) – it notes in the transaction description precisely what was purchased. It makes reconciling accounts much easier.
Fort Knox Federal Credit Union 5% Cash Back on Gas
Specifically the card is the “Platinum” card. You have to join the credit union, which they claim anyone can do. We believe you can join this organization and thereby qualify for membership with Fort Knox, but we haven’t tried. If you have any more insight, please let us know!
Uber 4% Dining Cash Back
“Dining” includes anything coded by Visa as a restaurant, a bar, or fast food. UberEATS also qualifies, although we are uncertain if other competitors to UberEATS qualify – we will have the card soon and will update as we learn more. The card also gives 3% cash back on hotels, airfare, and vacation rentals (including Airbnb).
Bank of American Choose-Your-Own 3% Cash Back
While many cash back cards have rotating categories, this card lets you pick your own and keep it forever – or you can change it once a calendar month. Note: you can only accrue points on up to $2,500 in spending per quarter.
The categories are currently: gas, online shopping, dining, travel, drug stores, or home improvement/furnishings.
We were surprised by the generous definitions particularly of the Home Improvement/Furnishings and Travel categories (which collectively include everything from basically any contractor, furniture store, or home supply store to art galleries, amusement parks, toll roads, and parking garages, respectively). Learn more about the category definitions here. If you are spending more than $2,500 per quarter in your chosen category or category mix, you may consider another more specialized card.
Thanks for reading
Efficient Financials is a simple little site focused on helping streamline your finances so you can focus on things that matter.
Sometimes this means solid recommendations (like our recommended financial services or our recommended investment strategy (temporarily down (hint: John C. Bogle).
Sometimes this means general thought experiments for major purchases (like our post on the safest, most cost effective car or how to remain in the iOS ecosystem for as little per year as possible).
If you are into the nitty gritty of investments, check out our sister site: www.informedfinancials.com.
Be First to Comment