Is Stockpile a Good Move for Beginner Investors?

Stockpile is an investment platform designed to simplify access to the stock market, particularly for new and younger investors. The platform provides a streamlined way for individuals to begin building an investment portfolio. Its primary focus is on enabling small, incremental investments.

Understanding Stockpile’s Core Offerings

Stockpile’s approach to investing centers on fractional shares. This means an investor can allocate a specific dollar amount, such as $5 or $10, to a high-priced stock, acquiring only a fraction of it. Fractional shares reduce the financial barrier, enabling investors with limited capital to participate in the market and diversify across various companies. This feature permits investing in expensive companies like Amazon or Alphabet without needing to buy a whole share, making market participation more accessible.

The platform also features a stock gift card system. A purchaser can select a specific stock and dollar amount, then pay for the gift card using a debit card, with no additional gifting or debit card fees for the buyer. While a specific stock might be suggested on the card, the recipient can choose to redeem it for any stock or exchange-traded fund (ETF) available on the platform, providing flexibility. Upon redemption, the recipient must open a Stockpile account, which includes a free 30-day trial membership before transitioning to a paid monthly or annual plan.

Investment Options and Account Types

Stockpile offers individual stocks and exchange-traded funds (ETFs). Over 1,000 stocks and ETFs are available, allowing investors to choose from a wide range of companies and diversified funds. However, it does not support investments in more complex instruments such as bonds, options, futures, or mutual funds. While direct cryptocurrency investment is not available, users can invest in cryptocurrencies indirectly through Bitcoin ETFs.

The platform offers two main account types: individual taxable brokerage accounts and custodial accounts. An individual account is available for users aged 18 and older who wish to manage their own investments. Custodial accounts are for minors, allowing an adult to open and manage an investment account on behalf of a child. The adult custodian maintains control of the account until the minor reaches the age of majority, which is typically 18 or 21 depending on state regulations, at which point the account can be converted to an individual account in the minor’s name. Stockpile does not offer retirement accounts, joint accounts, or business accounts.

Fee Structure and Transaction Costs

Stockpile uses a membership-based fee structure. As of August 17, 2022, it transitioned to a paid membership. Family Base costs $4.95 per month, or an annual payment of $47.45. A Family Plus membership is $9.95 monthly or $83.40 annually.

Stockpile does not charge commissions for buying or selling stocks and ETFs, a change from earlier $0.99 per-trade fees. For gift card purchases, the buyer incurs no fees, and recipients do not pay trade commission fees when redeeming their gift cards.

Other costs include a $75 fee for transferring an account via ACAT. While electronic statements and trade confirmations are provided free of charge, requesting paper copies costs $2 per document, and paper monthly or quarterly statements are $5 each. Outgoing domestic wire transfers incur a $25 fee.