Stockpile.com is a new website that aims to make purchasing single stocks as gifts easier. The basic idea is this:
- You choose a stock
- You select how much you want to purchase (in dollars)
- You can add an optional message
- You then pay by debit or credit card
- Stockpile then sends the “stock gift card” to the recipient
- The recipient either then logs in or creates an account with Stockpile.com and redeems their gift card for fractional shares in the company they received
You don’t have to use the service to purchase stocks for friends, you can also use it to purchase stocks for yourself.
At the moment Stockpile isn’t accepting new users automatically, you need to join their waitlist first and be invited.
Fees
There are a number of fees when you use Stockpile, you can view the full fee table by clicking here.
- Credit card/debit card processing fees: 2.9% + $3 per gift card. For example, if you purchase a $100 gift card you’ll pay $5.9 in fees
- Buying stock for yourself using a linked bank account: $0.99 per trade
- Selling stock: $0.99 per trade + SEC/TAF fees
The fees are quite expensive, especially for credit and debit card processing. Stockpile are able to reduce their own trading fees by doing batch trades (e.g they aggregate customer trades, so you won’t necessarily receive the same price as when you placed your order).
Final Thoughts
I find stockpile.com to be a bit gimmicky, I can see a lot of people using it to teach younger people the value in investing. My problem with this is that it actually sends the completely wrong message. It’s incredibly difficult to beat the market over a long period of time, it’s downright impossible to do so when you’re also paying excessive fees on top of that.
I understand that investing in a low fee mutual fund isn’t sexy, but over the long run you’re going to be much better off doing that than purchasing individual stocks. Stockpile.com is also currently in the process of making deals with financial institutions and credit card issuers in particular to partner with them, meaning it’ll soon be possible to turn your loyalty points/miles into Stockpile.com gift cards (which can then be used to purchase individual stocks).
What are your thoughts on Stockpile? Would you ever use this service? Let us know in the comments/why or why not.
Just got an email stockpile is switching to a membership model. July 15st, all members will be charged $4.95/mo going forward. Offered a lifetime membership price of $19.95 for all current customer.
Might take them up on the lifetime rate, since I planned on doing another $2k no-fee credit card spend on my Amex BBP for an easy 4,000 MR earn (~$80 earned for how I redeem), which would be like “buying” 4k MR points for $19.95, which I’d be happy to do.
Am I missing something or is this a decent way of meeting Minimum Spend on a card? Make a purchase on a day that the market is low in a stock that is solid and you get a good probability of making up on the fee when you exit in the next month? There is some element of gambling here on the stock itself, but are there any other concerns?
Short-term capital gains tax, if your pick pays off.
surprised to hear DoC is a indexer. Are you a Boglehead? 😛
Is there a list of stocks that are offered?
A little frustrating to find a stock I like,inky to find out is not offered on stockpile.
Does anybody have info on how the Dividends payout on StockPile? On Motif (who also does fractional shares) for example- its deposited into your Motif Account and can’t be ‘auto re invested’. They give you your tax forms so you pay proper tax on the dividends… But that money is free to withdraw. So even if you have a stock doing 0%, you can ‘make money’ simply by withdrawing the dividends. (Note, 15% is the common tax rate AFAIK)
IMO, if you have no other MS methods and PLANNED to buy some stocks anyways, I don’t think buying $500 (and paying hopefully $7.95 +3%) is a bad idea… Especially if you have a 3 or 5x card to off set the fees. You can sell the stock (ideally after it ‘goes up $6.95 worth) – and cycle your money back pretty quickly unless you’re unlucky.
The Trick is to pick stocks that only go up =)
Thanks for publishing this review of Stockpile! I just found out about this company and think it is an awesome product. While I agree that Stockpile is not the answer to building wealth for your retirement, I do think it is a great way to gift shares of stock to family and friends. It really makes the gifting process so easy. You don’t need to have your relatives social security numbers, set up a custodial account, or fill out any physical paperwork. It makes the process so seamless that I think the fees charged are reasonable. Once you buy the gift card, it is only $0.99 to sell your shares or buy shares in another company. I am definitely going to use Stockpile to buy some Apple or Disney stock for my nieces and nephews as a tool for them to learn about investing and how follow the market. And if it turns out they don’t want to own stock, they can redeem the card I send them for a gift card at companies like Brookstone, CVS, etc.
That was an almost convincing ad. A real CFP would never pitch something this stupid
His nieces won’t like stock gift cards… so they’re going to trade them in for CVS or Brookstone gift cards. Yes… every kid’s dream to have a $100 CVS gift card.
Oof. That was painful to read.