Here’s how safe it is to give your social security number to Acorns:
Acorns is popular with millions of users, handling social security numbers for all of them without any problems.
As an investment tool, Acorns is required by law to report any profits you make to the IRS.
Essentially, they have to use your social security number.
So if you want to learn all how safe and secure it is exactly when giving Acorns your social security number, then this article is for you.
Let’s jump right into it!
What Is Acorns? (3 Things)
If you aren’t already familiar with it, Acorns is a digital tool that is designed to help people with money management.
There are different features that are aimed at simplifying money management and empowering users with more options.
You can use Acorns to put money in savings accounts, investment portfolios, index funds, and more.
You can let Acorns manage everything for you, or you can take more of a hands-on approach.
On top of all of that, you can utilize Acorns via a website or the mobile app.
You have a lot of freedom regarding how you use their services.
I’m going to get into some specific Acorns features as we go, but for the overview, Acorns is designed to help you save and invest money.
#1 Manual Money Management
One of the easiest things to understand about Acorns is manual money management.
Using a number of different features, you can link a bank account and transfer money from it into Acorns as you see fit.
Additionally, you can have multiple accounts with Acorns.
Using manual transfers, you could put some money into a diversified retirement portfolio.
You can transfer into a money market account.
You can buy bins or CDs.
In this way, Acorns is acting like any other investment manager.
It’s giving you the means to use your money as you see fit.
While Acorns is perfectly adept in this application, this isn’t what really makes Acorns special.
The app really focuses on ease of use, so if you’re managing everything individually, you aren’t capitalizing on that ease of use.
#2 Automatic Deposits
Considering how many times I’ve thrown around the phrase “ease of use,” you can expect that we’ll be talking about automation.
And, that’s exactly the case.
Acorns allows you to schedule automatic deposits from any linked account to any of you investment accounts with the app.
Let’s consider an example.
Say you link your checking account to Acorns.
Within the app, you set up three different investment accounts.
One is very aggressive; another is very conservative, and the third is in between.
You can set it up so that every paycheck, a certain amount of money goes into each of the three accounts.
This is just one specific example.
The gist of it all is that you can automate savings and investments, and that’s nice.
#3 Round Up
All of that situation is nice, but it’s still not what really sets Acorns apart.
Their truly special feature is round up.
With this feature, you can link a credit or debit card to Acorns.
When you do that and turn on round up, then every time you make a purchase with that card, Acorns will round the total up to the nearest dollar.
It will then take that extra change and automatically invest it in whatever account you set up with the app.
Let’s try an example to make sure this is perfectly clear.
On your way to work, you get a coffee.
It’s not one of those super gourmet coffees.
Instead, it’s a simple cup of black coffee, and it costs you $1.50.
You use the debit card that you linked to Acorns, so round up activates.
The coffee vendor is paid their $1.50, but your debit card is actually billed for $2.
The extra $0.50 goes to Acorns, and it’s automatically invested in the retirement account you set up with the app.
A mere $0.50 might not seem like much, but if you get that same cup of coffee every day, it starts to add up.
Consider that this can happen every time you use your debit card, and it’s easy to see why this is a popular feature.
People don’t feel like they’re saving it investing, but the accounts steadily grow.
As a note, it’s important to say that Acorns is not the only app with this kind of feature.
But, Acorns is really the service that popularized round up investing.
Why Would You Give Acorns Your Social Security Number? (6 Reasons)
At this point, we’ve thoroughly covered what Acorns is and why it’s popular.
That doesn’t really address the original question yet.
Before that, there’s a more fundamental question.
Why are you even giving this app your social security number?
The answer to that is pretty basic. You have to.
Acorns requires you to input your tax identification number (which is usually the social security number) in order to use the services.
No number, no investing.
But you know what?
This really has to do with more than just Acorns policy.
It turns out that the app is required by law to record your tax ID.
It’s all about taxes.
Acorns is required by law to report any money you make to the IRS.
Acorns is designed to help you make money through investing.
The thing is, if you make money, the federal government wants a cut.
In order to do that properly, they need your social security number.
A social security number is not something you want to provide to a random app developer on a whim.
Nor is bank account information.
So, we have to ask this question, and we have to ask it thoroughly.
Does Acorns use proper security tools and techniques?
Did the app have a sound policy that reasonably protects you?
Is it an outright scam?
I’ll take you through detailed answers to each of these questions, but I’m going to start with a spoiler alert.
Acorns is safe.
In fact, I use it.
#2 Fraud and Scams
Let’s start here.
Is Acorns a scam or fraudulent app?
No. It is definitely neither of these things.
As I mentioned, I use Acorns regularly, and I’ve never had a problem.
It’s a legitimate business based out of California, and it’s actually already 10 years old.
It’s fully regulated by the FTC (more on that later), and it has millions of users.
The only scam rush with Acorns would be if you downloaded a fake app pretending to be the real thing.
As long as you stick to verified apps in official app stores, that shouldn’t be a problem.
#3 Online Security
It’s great that Acorns isn’t a scam, but that still doesn’t mean you can trust the app with your social security number.
For that, the app needs to prove itself in terms of security.
Good news. Acorns is secure.
The company doesn’t publish division security protocols (for good reason), so I can’t describe everything perfectly.
In general, Acorns is up to snuff.
It seems to use the same essential security techniques as any other online financial entity.
If you’re comfortable using online banking or shopping, then Acorns shouldn’t scare you.
In the interest of transparency, it’s worth noting that Acorns has had a data breach.
Even considering that, it still has a good track record.
Even if Acorns is secure, it’s meaningless if they’re just going to sell your data and personal information.
Once again, Acorns is reliable.
The company absolutely does not share your social security number with anyone except the IRS (or any other tax agency as required by law).
Yes, the company makes money through clearly defined fees.
They don’t need to trick you with hidden fees, and they definitely don’t need to sell your data.
Here’s the most important thing.
Acorns savings accounts are backed by FDIC insurance.
You can’t get that as a business unless you junior through a lot of hoops.
It’s an important trust indicator.
The investment accounts are backed by SPIC insurance.
If you aren’t familiar, SOIC is a lot like FDIC, but it specifically covers investment accounts.
Acorns would not be able to maintain this important insurance if they were routinely mishandling social security numbers.
On top of that, these insurances protect your accounts with Acorns.
Lastly, Acorns is a properly regulated business.
I mentioned the FTC.
This is an entity that exists to protect consumers from malicious or harmful business practices.
If Acorns suddenly started streaming division security numbers, the FTC would have a lot of recourse.
Probably more important is that Acorns is regulated by the SEC (Security Exchange Commission).
This regulating buddy oversees all investment companies in the United States.
If you get on the wrong side of the SEC, your business gets put down quickly.
The SEC doesn’t tolerate division security number abuse, so this is one more strong indicator that Acorns is safe.
And no, Acorns didn’t pay me to say any of this.
It’s an app that I use and like, and even if you don’t take my word for it, there is a large body of evidence that Acorns is perfectly reliable—especially when it comes to handling your social security number.
Here’s one final thought.
If you can trust Acorns to handle money for you, would it really be so crazy to trust them with your social security number too?