Aspiration Investing Review: You Choose the Fees You Pay

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

Aspiration review

Eighty-four percent of millennials — and 71 percent of all adults — are interested in sustainable investing, according to a 2017 Morgan Stanley Survey. As more investors demand socially responsible investments, financial institutions have responded by creating new financial products focused on investing sustainably.

In fact, more than a fifth of funds under professional management are now in funds that do at least some screening to eliminate companies that are considered socially irresponsible, according to The Economist.

Aspiration

Image credit: The Economist

If you’re interested in sustainable investing, you don’t need a fortune to invest in funds that restrict investments to responsible companies and industries. Aspiration provides an opportunity to invest based on your values while paying only the fees you feel are fair. To find out if Aspiration investments are right for you, read on.

Aspiration review

Image credit: Aspiration

Aspiration Investing Review

Aspiration is an online investing platform with funds managed by UBS Asset Management. When you invest with Aspiration, you select a fund to invest in; that money is then pooled with other investors who have chosen the same fund. Fund managers invest the pooled money in assets that meet certain criteria.

Aspiration sets itself apart from other financial institutions because the company hopes that investors will feel they’re joining a community, not just buying financial products. Investments for Aspiration’s Redwood Fund are made only in sustainable companies that meet rigorous criteria, such as no exposure to fossil fuels and treating workers fairly.

Aspiration focuses on “profit, people, and the planet,” and the goal is to allow investors to earn competitive returns while investing their values.

Who can invest with Aspiration?

Affordable investing is one of Aspiration’s key goals and they make it easy, with only a $100 minimum to get started. While interest in sustainable investments has been growing, the majority of these investments were in the hands of a small number of institutional investors, money managers, and community investment institutes. Aspiration believes everyday investors were closed out of the market for sustainable investments due to high fees or high minimum balance requirements. They wanted to offer something different.

Aspiration offers retirement investing through IRAs with $100 starting balance requirements, as well as the option to invest in professionally managed funds that are fossil-fuel free. The only requirements to invest are:

  • A permanent U.S. address
  • A U.S. Social Security number
  • Being 18 or older
  • A checking account from a credit union or U.S. bank to fund your account

Aspiration will run a soft credit check to verify your identity, but there is no hard credit check when you open an investment account with Aspiration.

How much does it cost to invest?

One of the key things that sets Aspiration apart is its “Pay What is Fair” fee structure. According to Aspiration, you pay only what you believe is reasonable for the investment management services provided. There are no hidden fees or minimum fees and you can change the amount that you pay at any time.

Regardless of how much you pay or don’t pay, you get the same benefits and have the same rights as all other customers — even if you decide to pay $0. Aspiration also donates 10 percent of earnings to charity.

“Like others, I was skeptical at first, however Aspiration has won me over with excellent customer service…I enjoy the ability of being able to select how much I am able to contribute each month for having the account (can even be zero),” one investor, Brian C, commented in a Yelp review.

There are, however, some operating expenses for the funds you invest in through Aspiration. Aspiration caps operating expenses at 0.50 percent of assets and Aspiration pays for most excess expenses over this 0.05 percent. That 0.50 percent goes toward accounting fees, legal fees, audit fees, and state registration fees.

Aspiration review

Image credit: Aspiration

Aspiration also does not charge any custodial fees for IRA accounts, which typically average $25 to $50 annually.

How can you open an Aspiration investments account?

To open an account and begin investing with Aspiration, you’ll start by selecting whether you want a retirement account or other investment products. If you opt for a retirement account and open an IRA, you can invest with pre-tax dollars.

Aspiration review

Image credit: Aspiration

With either the IRA option or the traditional investment option, you get to choose from two different investment products:

  • Redwood IRA or Redwood Fund: The Redwood Fund focuses on sustainable investments in companies that meet strict criteria regarding environmental and employment practices.
  • Flagship Fund or Flagship IRA: The Flagship Fund focuses on long-term growth with minimal volatility; it is made up of other mutual funds and exchange-traded funds with a track record of steady performance.
Aspiration review

Image credit: Aspiration

Choose which of these funds seems most in line with your investment strategy, and click on the appropriate option to “Open Redwood Fund,” “Open Flagship Fund,” “Open Redwood IRA,” or “Open Flagship IRA.”

You’ll need to enter an email address and will be sent a link to sign up for Aspiration.

Aspiration review

Image credit: Aspiration

You’ll receive an email with more information on the fund you’ve chosen, and can click “Join Now” to move forward with your application.

Aspiration review

Image credit: Aspiration

Clicking “Join Now” in your email from Aspiration will take you to the application to fill out to open and fund your account. You’ll need to input your email, create a password, and again, select the product you wish to invest in.

Aspiration review

Image credit: Aspiration

Next, you will fill out the application with:

  • Your full legal name
  • Your date of birth
  • Your Social Security number
  • Your gender
  • Your address
  • Information about your funding financial institution and the amount of your initial investment

The entire account can be opened quickly and easily online so you can get your money invested promptly. You can make your first deposit right away during the signup process as long as you can confirm your linked bank account.

Pros and cons of investing with Aspiration

Investing with Aspiration can be a great solution if:

  • You want to invest in funds that focus on sustainable investing and that are managed by USB fund managers
  • You want to get started investing with a low minimum balance
  • You want control over how much you pay so you only pay what you believe services are worth
  • You want to invest with a company that donates part of its earnings to charity

However, there are some possible cons to be aware of.

  • You have to pay fund operating expenses
  • Some expenses are not reimbursed, such as expenses of investing as a shareholder in underlying investment companies if you invest in the Aspiration Flagship fund.

It’s important to compare total fees you are charged for your Aspiration investment with those charged by robo-advisors such as Betterment and Wealthfront.

Many investors with Aspiration report being happy with the products and services the financial institution provides. However, one Yelp reviewer spoke more highly of the Redwood Fund compared with the Aspiration Flagship Fund: “Redwood Fund so far for me seems like a good investment offering. Current performance is not bad…[but] the Aspiration Flagship Fund’s performance so far seems lousy…the performance gain is minimal.”

Like all investment accounts, it’s important to carefully research the funds that Aspiration allows you to invest in to determine if their products are right for your overall investing strategy.

Contact Aspiration

You can contact Aspiration via phone at 800-683-8529 or via an online chat feature during business hours, which are:

  • 8 a.m. to 5 p.m. PST, Monday through Friday
  • 11 a.m. to 1 p.m. PST, Saturday to Sunday

If you need help after hours, you can call 800-242-0272 from 8:30 a.m. EST to 9 p.m. ET, Monday through Friday, and 9 a.m. to 1 p.m. ET, Saturday to Sunday. You can also visit the Customer Support page for more information on opening an account and investing with Aspiration, if you’re interested in trying out their investment products.

Want to get started investing?

Here are the top investing options for 2018!
NameCommissionAccount Minimum 
Blooom$10/month$0Visit Blooom
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Wealthfront0.25%$500Visit Wealthfront
Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.