Why Stash Invest is STILL a Little BS, and Why I’m OKAY with It

What is up. ladies and gents welcome back to the good ol tech crack house here today. Now today I will be answering a question from a subscriber commenter guy Kevin Hogg I think that’s how you pronounce your name I apologize if I’ve slaughtered that. But he left a comment on my wife’s – investments complete BS article and if you’re going to make a article with claims like that and calling an investment service BS then you better be ready to back it up right so hopefully I. You know. I can answer the questions that he asked in this article kind of going off of this comment and I am ready to support my opinion and basically why I stated that stash invest is BS I did quite a bit of research before making that article. So I do think that my opinion is valid once again it is my opinion so it’s maybe not 100 percent correct. But at the same time I think it’s relatively Rhodes will be valid it will private somebody’s due for me to uh to back up what I’ve said so Kevin thanks so much for commenting asking subscribing I really appreciate it I appreciate all questions that my subscribers asked me and here I go I’m going to read your comment. So I hope you don’t mind. But uh I think it’ll provide some context so Kevin says hi I’ve been users – for a few months. Now and I’m actually quite loving the returns that I have been seeing I am no expert by any means of investing and stash has been an awesome app that has helped me learn along the way that’s good that’s seriously good a few red flags popped in my head when I saw the article and I went ahead and even called stash to see what’s up I haven’t seen any expense ratios deducted from neither my portfolio or my bank and based on what the representative I spoke with said presumably they say that the expense ratios are always factored into the price of the stock I currently own blue chip stocks and the expense ratios are abysmally low seven cents a year or zero point zero seven cents no zero point zero seven dollars I guess that’s an ually maybe can you clarify as to what is happening in the situation or why – is complete BS Thanks I just subscribed thanks for your subscription I appreciate it and thanks for your question. Now that I’ve read your comment let me go head and try to explain basically my reasoning behind why I said that the expense ratios and the chart the charge applied to your account by status is kind of BS and kind of kind of holding people back I think from the true potential of investing in ETFs that are relatively simplified so ETFs use the thing called an expense ratio and basically an expense ratio is an expense ratio I can’t talk for some reason it’s a certain portion of your Holdings that are withdrawn from your holdings each year or on a specified date their holdings that it’s a monetary value withdrawn from the company proportional to your holdings and they take that money and they use it to pay managers of the account they use it to pay employees etc etc so these funds are taking expenses which are taken directly out of your account and they are using them to pay themselves. Now it makes sense right. Because you need upkeep you need employees you need people to run these funds it makes total sense I don’t think that is disagreeable or anything like that I’m fine with a expense ratios especially on ETF that I own where I kind of had issues was a stash invest has expense ratios and a monthly charge. Now when stash you’re not going to see expense ratios really coming out of your account. Because expense ratios are factored in by companies. Okay, by managers of these funds etc they take the money out as a proportion of your total holdings in that fund each year so it’s not all that noticeable honestly and it almost seems as though the expense ratios aren’t being deducted sometimes I assure you they are. Okay, I am. You know. I actually have a difficult time even noticing on expenses have been taken out of my account I look I’ll look at the expense dates I kind of keep track of them. But otherwise unless you’re really keeping an eye on expense ratios from ETFs they’re going to be almost not noticeable at all. Okay, and. You know. it’s kind of it falls into more of a technicality than anything else. Because when these expense ratios are taken out of your funds you are blue money to expenses it’s not very noticeable and most ETFs have very low expense ratios so really you’re not losing all that much money when you. You know. when your expenses are extracted annually or quarterly or however frequently they are from your account and that’s why. You know. if you have a one hundred dollar investment and seven cents is being taken out that a year and you’re still seeing growth that is still good. Okay, that’s completely fine I don’t have any issue with ETFs I would not expect stash to alert you of the expenses or to have any sort of scheduled expense. You know. thing or schedule even set up to kind of fill you in on what expenses are being taken out this really comes down to the company the provider of the ETF the fund management team etc to provide investors with information on expense ratios I don’t think that this falls on stash so while it may seem that expense ratios are negligible or not even noticeable they do still exist they have to. Okay, they have to with these ETFs they’re just factored in naturally so stash invest still charges you one dollar per month and I do not believe that that one dollar per month covers expense ratios. Because expense ratios are inherently drawn from fund funds from your fund Holdings they’re they’re inherently removed as a proportion of your holdings however frequently the fund managers have decided. So I think I hope that kind of answers your question let me look again at what you what you commented exactly. Because I want to make sure I didn’t mess anything up or miss it always factored into the price of the stock they are they the expense ratios are factored in. But they are charged still I currently own blue chips and expense ratios are abysmally low. So you asked if I could clarify what’s happening in the situation I think I just covered that I think it’s still kind of BS. Because you’re paying for expense ratios and you’re paying for a monthly fee whereas you could just be paying the abysmally low expense ratios and dependent from stash invest I understand if you still like to stash that totally fine that makes sense to me. But I think you could probably save a little bit of money if you weren’t paying the monthly expenses from stash and you were using a different investment app such as Robin Hood for example that lets you buy into ETFs with. You know. no outlining expenses aside from expense ratios which are factored in to holdings that you already own. So I hope that clears that up I didn’t want to make it too complicated complicated I just want to I want to kind of get to the point and kind of let. You know. what exactly my feelings were on that and kind of try to explain it a little bit more. So I hope that helped you thank you so much Kevin for asking the question I really appreciate it still and I hope that you honestly I’m fantastic then I hope that all of you have a fantastic day and that you learn something here. So if you did feel free to like share subscribe do all that good stuff folks have a truly good day truly good day not just a good day and we’re going to hit 10,000 subs soon that’s exciting.

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