Is Grifin a Good Way to Start Investing

Important Grifin Update

It was always probably a little too good to be true. An app that invests a dollar every time you make a purchase with no fees or user face costs. Everything costs money, especially running an app that accesses credit cards, makes transfers from banks, and then buys and tracks investments in partial shares of stocks.

I have no idea what the plan was in the beginning, but I can only imagine it was something like, “We’ll figure out how to monetize it when we’re huge,” or maybe, “We’ll get big enough someone will buy us for a big exit before we run out of venture capital money.” Neither of those worked out, so instead, Grifin will start charging $5 per month.

They did their best to sugarcoat it. There are some new features, but none that can justify $60 a year in fees for accounts that have just a few thousand in them. After all, even stock where you shop doesn’t necessarily add up that quickly, as I pointed out here and in my comprehensive Grifin review. From my first investment back in fall of 2021 to now, I’ve built up a nice littel $1,100 or so. I’ve liked it every step of the way, but $60 per year is over 5% annually in fees, and if you’re just starting out, it could be a lot more.

So, I’ll be closing my Grifin account in the coming days and I’ll let you know how in goes. In the meantime, if this still all sounds like a good deal with the new fee structure, it was always a fun way to do some investing.

Everything below here was written BEFORE the new $5 per month fee was implemented. Factor that in with any thinking you have or develop as a result of reading the rest of this article.

One of the questions I’ve gotten a lot over my financial career is how to start investing. The reality is that just about any way you start investing is a good way to start investing. Unfortunately, the idea of an investment account, a brokerage, and investments themselves can seem overwhelming to some. I’ve created dozens of blueprints, trainings, and white papers all aimed at answering the question, “How can I start investing?” These days, there are plenty of apps out there removing the barrier to investing accounts.

One of these is Grifin. Is Grifin a good way to start investing?

Buy Stock In ‘Your’ Companies

Warren Buffet famously said, “Invest in what you know.” Peter Lynch said, “Know what you own, and know why you own it.” At the same time experts try and dissuade investors, especially beginning investors, from trying to pick stocks or time the market. “Just buy a market level mutual fund, or ETF, and down worry about buying stocks,” they say.

The reality is that timing the market, and picking individual stocks seldom works out even for professional investors. Every year dozens or hundreds of mutual funds get rolled into other more successful mutual funds, in large part to hide the fact that investing pros and their investing companies are wrong as often as they are right.

Be that as it may, investing in mutual funds is boring. An S&P 500 ETF doesn’t feel like you are investing in real companies. This is where the Grifin app comes in. Grifin allows you to invest in individual stocks that you can see do well, or not. Not just any stocks, either. Grifin lets you invest in the companies that you do business with. After all, if they are good enough for your consumer dollars, why not your investing dollars?

Is Buying Stock in Companies You Do Business with Smart?

Grifin calls it, “Stock where you shop.” It is a simple idea that postulates that the companies you do business with are the companies that you will invest in. The more you use those businesses the more you will invest in them. It makes sense right? How many times have you said something like, “I go to Starbucks so much, I should own stock in the company.” Grifin says, “Yes. Yes, you should.”

Grifin makes investing easy. Really easy. Download an app and link a credit card and bank account easy. Then, they take away all of the fear and doubt about investing. You are investing in real stocks, but you aren’t controlling the investments. It isn’t your fault if they go down. And, since Grifin only takes $1 per purchase, you aren’t really risking any “real” amount of money.

For people paralyzed by fear, afraid of the paperwork, or just big ‘ol procrastinators nursing a case of ADHD, Grifin is a good way to start investing. It’s so easy, and so tame that there is no excuse not to. Investing anything is better than investing in nothing. So, sign up during the next commercial in the Simpsons.

How Do Grifin Investments Perform?

The million-dollar question is does Grifin’s investment portfolio make money? The longer you use Grifin, the more companies’ stock you will own. When you own a lot of different stocks, you have diversified your portfolio. Although, you will end up buying a lot more large cap U.S. stocks than mid cap or small cap stocks since it’s the big boys that build locations everywhere.

Your portfolio will be heavily weighted toward retailers, restaurants, oil companies (gas stations), and travel companies (assuming you travel). I’ve got a lot of Uber stock from a bunch of rides we took while on vacation this year. You’ll have to get investments in manufacturers and B2B companies elsewhere.

In the short term Grifin investments perform great. Of course, at just $1 per stock per visit, the actual dollar amount will be much less impressive than percentages. A recent update to Grifin added the ability to see your overall gain or loss. As someone who has been using Grifin for over a year now, I’ve invested $647.00, including a $20 cash deposit I threw in for testing purposes. Today, my account is worth $684.20, up 2.98%.

What Stocks Are In Grifin Portfolio?

So, what stocks does Grifin invest in?

Where do you shop? With Grifin, you’ll start investing a small amount in each of those. My biggest stock position is in Amazon. No real surprise there. My $60.77 position is down 5% overall. I’m not worried. My second and third largest stock positions are my grocery stores, Kroger, and Albertsons (as Safeway). I’m not so sure if these are good investments by Grifin. I can sell my Grifin stocks, of course, but I don’t dislike these holdings that much.

From pretty much there on down to my smallest holdings in Grifin I’m pretty happy with owning those stocks. My McDonald’s investment is probably larger than most people using Grifin investing. (I regret nothing) Then my Grifin stock portfolio looks like this:

• Home Depot – $27.92
• Starbucks – $26.58
• Berkshire Hathaway (via Dairy Queen) – $23.37
• Yum Brands – $17.47
• Microsoft – $16.02
• Chipotle – $14.39

And so on.

Controlling Your Grifin Investments

I only have one credit card hooked up to Grifin, but I have more credit cards for various credit card points or rewards. This provides a way for me to shape my Grifin portfolio. For example, I don’t really want a big grocery store position. So, now, I use one of my unlinked cards to pay there. Other investments I do like, I make sure to use my Grifin credit card when I go there so I invest another dollar.

About the Author

Brian is a former Certified Financial Planner with over 20 years of experience in the banking and investing industries. At the time of publication, the author does own stock in all the companies mentioned in this article, although this could change at any time. All articles on Finance Gourmet are for informational purposes only and are not a recommendation to buy or sell securities.