Can apps help young people get into investing?


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19th August 2021

The recent Covid-19 lockdown has caused us all to recalibrate and think about what’s important. When it comes to money, it has prompted us to take another look at how we spend and save – people want their money to go further and are more keenly aware of building for their future or for a rainy day since the pandemic began.
This is even more pertinent for young people, who studies repeatedly show are less likely to own their home than previous generations and sometimes lack money confidence – even by their own admissions, according to a 2017 survey from the UK’s Money Advice Service.
Yet advancements in technology mean that tech-savvy millennials are faced with new options for saving and investing their money – something which was previously seen as unrealistic and inaccessible. So will new investment apps encourage a younger generation to get interested in investing their money?
Here, we take a look at some of the up-and-coming fintechs who are introducing new functionality to the investment marketplace and explore how younger consumers are being drawn in.


One of the best-known innovators is Wombat, which brings together several different features that help it appeal to a millennial audience. Like many of the large players, these include fractional ownership, meaning users can invest a set amount in their favourite stocks and shares regardless of the share price. This reduces one of the most significant barriers to investment for younger consumers; the price of popular stocks such as Amazon, Google and is in excess of $1,000 per share.
As well as the ability to buy individual stocks, Wombat users are presented with a number of curated funds designed to appeal to their personality. They include ‘The Techie’ with stocks such as Apple, Facebook and Microsoft; ‘The Innovator’ featuring the likes of Netflix, Paypal and Twitter; and ‘The Gamer’, which includes AMD, EA Sports and Nintendo.
Along with a Learning Hub that helps teach investment principles, an intuitive UX design and some features that ‘gamify’ savings goals, Wombat is a serious contender when it comes to making investment appealing and accessible to young adults.


Plum bills itself as ‘the ultimate money management app’, rolling the ability to invest in stocks and shares with some useful everyday features like a clever algorithm that automatically sets a savings pot aside based on the user’s spending behaviour. The app links directly with a user’s mobile banking to provide a clear snapshot of regular payments leaving an account, as well as offering
Investing comes through a subscription to Plum Plus, which costs £1 per month on top of annual partner fees and fund-specific fees. Plum say they will only charge users if they have money invested. Like Wombat, Plum has a range of funds – both basic funds, which it says are good for first-time investors; and advanced funds, which allow the user to find a set of stocks that align with their personal principles. They include a ‘Clean & Green’ fund, two different ethical growth funds and separate funds dedicated to American, British and European stocks.
What Plum and Wombat do well, particularly compared to earlier investment platforms, is taking the decision-making out of the user’s hands. Critical information like past returns and risk profile are presented upfront, but consumers do not need to be expert stock-pickers in order to start investing. The same caveats exist of course – particularly risk only what you can afford to lose – but platforms like this could represent a greater democratisation of investment.


Another app of note is New York-headquartered Stash. It eases a key pain point for millennial investors – minimum deposit limits – by offering a startpoint as low as $5. With 5 million registered users already, the app also offers several features that are becoming ubiquitous – albeit well-received among consumers – within banking apps. They include an account with no minimum deposit fees and the ability to bring your payday forward by 2 days, as well as individual savings goals and ‘round-ups’, which offer the chance to round purchases up to the nearest dollar amount and deposit the spare change in a savings pot.

Risks and warnings

Investing is never without its risks and the same caveats apply to sleek and stylish investment apps as the incumbent investing platforms. Apps like Wombat, Plum and Stash make it easier and more accessible for first-time investors to put their money to good use.
But that has prompted a warning from the UK’s Financial Conduct Authority, which in March published research that showed a younger, more diverse group of consumers getting involved in higher risk investments. The FCA claimed that was “prompted in part” by accessible investment apps. The research claimed that, for nearly 60% of those consumers, a significant investment loss would have a fundamental impact on their current or future lifestyle.
There is clearly a huge appetite among younger consumers to use their money more wisely – this is Reflected in the $35bn valuation that cult investment app Robinhood sought a few weeks ago at its IPO. The company’s shares actually fell in its early trading sessions but has since recovered significantly, with its own users said to represent a sizeable slice of shareholders.
The launch of new apps and platforms will only accelerate this demand – but their ease of use, accessibility and consumer-friendly design still need to be measured against the financial risk involved in investing and the need for consumers to understand their investing decisions.
It’s a very difficult balance to strike – but one that, when done right, could completely transform the landscape for consumers who never considered investing before.