Robinhood Review (2023): Is It Worth Investing Your Money Into?

Robinhood is a mobile trading app I struggled with using for a while. Eventually, I get the hang of it, and is now my primary investing app. However, during my investing journey, Robinhood has its share of growth and setbacks. In this article, I will share my overall experience with Robinhood. Also, I will give my view on if it is worth other young investors to put their money into. Despite the many issues that have hurt Robinhood’s reputation, I would not completely rule them out.

Table of Contents

Subscribe for Free Stock

When you subscribe to my website, in addition to updates, you will receive a free stock worth between $5 and $200 after signing up for Robinhood and linking your bank account!

About Robinhood

According to its website, Robinhood is a trading company that uses tech to make it easy for everyone to participate in our financial market. Originally a mobile app, they allow anyone, especially young people, to invest in the stock market. Robinhood is completely free to use; there are no trading fees or any other fees. They do have paid plans that include more advanced features. However, investing beginners do not have to worry about missing out on these features. Robinhood’s core features are free and standard across the board.


Robinhood is founded by both Baiju Bhatt and Vladimir Tenev. Both of them were classmates and roommates at Stanford University. When they graduated from college, they moved to New York City and built two finance companies. With their companies, they sold trading software to various hedge funds.

While working on their businesses, they realized that those on Wall Street did not pay anything to trade stocks. Meanwhile, everyday people pay fees for every trade they make. Baiju and Vlad realize how unfair this is and strive to do something about it. They worked to build products that would provide everyone, not just the wealthy, with access to the stock market. As a result, two years after moving to New York City, they moved back to California to build Robinhood.


Robinhood lives by three main values to aid in their mission to make the stock market easy and available for everyone, no matter their wealth:

  • Deliberately engineered systems
  • Simplicity
  • Individual participation in equity markets


Robinhood has grown to offers a variety of features to both its mobile and web app users. These features are built to provide an all-in-one experience where people can save, invest, grow, and spend their money in one place.

Robinhood’s main features include:

  1. Access to the Stock Market and ETFs
  2. Cash Management
  3. Options Trading​
  4. Robinhood Gold
  5. Cryptocurrency
  6. More

Access to the Stock Market and ETFs

The feature that started Robinhood; allows users to get mobile and web access to the entire U.S. stock market. Users can invest in stocks from their favorite businesses or a bundle of investments called ETFs (Exchange-traded Funds). This feature is completely free with no fees for trading at all.

Cash Management

This feature allows users to spend the cash sitting in their Robinhood account that is not invested. They are given a debit card that can be green, black, white, or an American flag pattern. The debit card is issued by Sutton Bank and is FDIC Insured for up to $1.25 million. Unfortunately, cash on the debit card only earns 0.30% APY (Annual Percentage Yield), which is almost nothing. However, there are no hidden fees or minimum balance. Finally, this feature does include direct deposit.

To be honest, this is the only feature on Robinhood I do not use at all. In fact, I have no interest in ever using this feature. For a trading platform, I do not see the purpose or benefit in being able to spend cash that either has a purpose for being in the app or is on its way out. Also, 0.30% APY is almost as nothing as what major banks give for their savings accounts.

Options Trading

Robinhood defines an option as giving the owner the right to buy or sell a security at a certain price up to a certain date. To trade options in Robinhood, users are given options contracts. An options contract allows its owner to buy or sell 100 shares of an asset for a profit. To simplify all of this, this feature is betting on the stock market. You buy or sell an option when you think the stock is going to go up or down.

Robinhood Gold

For $5 per month, users can upgrade their Robinhood account and use more advanced features. First, Robinhood Gold gives users access to professional research reports that are provided by Morningstar. These reports provide access to in-depth research on about 1,700 stocks. Also, they provide Level 2 market data to help determine if a stock is desired at a certain price.

Second, Robinhood Gold users can trade on margin. What this means is users can buy stocks on credit and pay it back over time. Finally, gold users can make bigger instant deposits. Free Robinhood users can only make instant deposits up to $1,000. However, gold users can deposit between $5,000 and $50,000, depending on the size of their account.


Cryptocurrency has been on the rise for the past few years. As a result, Robinhood allows its users to buy, hold, and sell Bitcoin, Ethereum, Dogecoin, and more.

More Features

Robinhood now has smaller features that come from their competition, mainly Stash Invest. First, they now allow users to buy fractional shares. This is Stash’s main feature that allows users to buy a share in stock for as little as $1 or less. Also, Robinhood allows users to reinvest their dividends back into its stock.

Subscribe for Updates

When you subscribe to my website, in addition to updates, you will receive a free stock worth between $5 and $200 after signing up for Robinhood and linking your bank account!

Why I Use Robinhood

I use Robinhood because of how free it is for anyone to use. I first found out about this app through a mutual friend. Seeing someone who looks like me and comes from a similar background as me actively investing his money was inspiring. I got to see his portfolio to get a feel for the app. I was impressed by how visually clean the app is. Also, my friend’s portfolio was very diverse. He explained to me how free Robinhood is and stressed how important it is for Black men to start investing their money. Especially now that there is a free app available to make it possible.

Robinhood is a game-changer in how people can invest their money because it is completely free. Before Robinhood, trading in the stock market was not free or available to everyone. Only people with money could trade through brokerage accounts. The problem with these accounts is they are expensive to maintain. They charge a fee for every single trade and other activities, which does add up.

However, Robinhood removes this disparity by making investing in the stock market free of charge and available for everyone. No matter a person’s wealth or background, anyone can now invest in the stock market. Everyday working people can now grow their wealth the same way rich people already do.

My Experience Using Robinhood

After my friend first introduced me to Robinhood, I spent time doing some research before signing up. To be honest, it took a while for me to get the hang of this service. Not because I did not understand how to use the app, but because I did not know how to trade in the stock market. In fact, I did not know how to invest my money at all.

Robinhood is not a platform for beginners who do not know how to invest in the stock market. If this is you, I suggest reading all of their articles and guides before putting your money into the app. When I first signed up for Robinhood, they did not have as many tools and guides as they do now. What they did have, I did not fully read. As a result, the money I put into this app I ended up losing because I did not fully know what I was doing.

Early Difficulties

When I first signed on to Robinhood, I thought I could purchase any stock for any amount of money. After plenty of bad attempts at placing limit orders, I finally learned that I cannot do this. As a result, I only bought cheap shares I could afford. However, this became a costly mistake because I did not research the stocks before buying. All of the cheap stocks I bought at the time were losing value more than they were gaining.

Feeling upset that I lost money, I decided to give up and stop using Robinhood. However, when they introduced their Options Trading feature, I gave them another try. I did some research on what options trading is and thought I understood what I read. As a result, I was making bad bets and ended up losing even more money.

Robinhood vs. Stash Invest

Feeling discouraged, I completely stopped using Robinhood for almost two years. During this time, I educated myself to better understand how to invest my money. I even look for ways to invest the money I can afford to set aside, and watch grow.

As a result, I found Stash Invest, an app that allows users to invest in their favorite companies with what they could afford. Stash achieves this by allowing users to buy fractional shares. This means that users can invest in any company they want for as little as one dollar (now just one cent), instead of paying for the entire share price.

At the time, I thought Stash Invest was perfect for me. I could invest any amount of money I could afford into any company I want. Also, Stash Invest provides plenty of helpful articles to finally help me understand how to invest my money. They even provide good incentives to encourage me to read them.

Read More: Stash Invest Review: The Best Affordable Investing App for Beginners >>

Despite Stash being a great platform for beginners, I still preferred using Robinhood. At the time, they provided almost the entire stock market, unlike Stash, and have more features. By early 2019, I was in a good position to use Robinhood again. This is because of the knowledge I gained while using Stash. Also, I finished college and began my first full-time job. Therefore, I could afford to set enough money aside to buy certain stocks at their current market price.

Subscribe for Updates

When you subscribe to my website, in addition to updates, you will receive a free stock worth between $5 and $200 after signing up for Robinhood and linking your bank account!

How I Use Robinhood Today

Today, I use Robinhood to achieve both short and long-term personal finance goals. My main long-term goal is to buy and hold shares in companies to gain a huge profit a few years from now. As I work toward this goal, I also want to build a diverse portfolio of stocks and ETFs I own in various industries. My ideal industries include Real Estate, Retail, Tech, Bonds, and Healthcare.

So far, my portfolio includes stocks from Apple, Nike, Microsoft, Target, AT&T, some bond ETF stocks, and more. These stocks I plan on owning as long as I can to gain the most profit possible. I also own these different stocks to mix up my overall portfolio to ensure growth. Not every industry does well or badly at the same time. I mix up the type of stocks in my portfolio so if stocks in one industry are doing badly, stocks in other industries that are doing well can make up for it.

As a result, my overall portfolio is still doing well and continues to grow in profit. For example, if my retail and real estate stocks are doing badly one day, my bond ETF and tech stocks can make up for the loss. At the end of the trading day, my overall portfolio can still gain in value, even if only by a couple of dollars.

Many stocks I own to gain a profit long-term also serve to achieve my short-term goal, which is to earn passive income. I work to achieve this in two ways, by collecting dividends every month or quarter, and trading options for a quick profit.

Dividend Investing

Dividends are cash payments of a business’s profits paid to owners of their shares. Dividend investing involves buying enough shares of stock to collect as many dividends as possible. Usually, businesses pay dividends every quarter. However, some businesses pay dividends every month.

Now, before you get too excited, understand that dividends, especially monthly dividends, are very cheap. You have to purchase a lot of shares in one business, and in many businesses, to be able to collect enough dividends to live off of. This is no easy or affordable task unless you are already rich.

The amount in dividend payments depends on the dividend yield amount divided by twelve for each month. If the business pays dividends every quarter, you add three months together. For example, a $20 stock can only pay five cents per share in dividends each month. To earn $1 per month in dividend payments, you need to own 20 shares (0.05 x 20 = 1). 20 shares at $20 per share equal $400 invested into one company, just to receive $1 a month or $3 each quarter.

All of this is why I never lose sight of my long-term goal of holding stocks as long as possible to gain the best profit. In fact, I consider this goal when choosing stocks to buy for their dividends. At the end of the day, it does not matter how much in dividends a company pays or how often they pay them. If their stock does not perform well and cannot gain a good profit over the next few years, then it is just not worth buying.

How to Find the Right Stocks with the Best Dividends

Dividend investing is certainly not a get-rich-quick scheme. It will require a lot of time, money upfront, and patience. The best way to properly start investing to collect dividends is to do your research. When looking for stocks to invest in for dividends, I usually follow these steps:

  1. Look into the stock’s past performance. It can provide good insight into the stock’s potential. You can learn how well a stock has done over the past few years or decades to have an idea if the trend you see would continue. However, this should never be the main deciding factor. Consider the past, but also look to see if the future looks promising.
  2. Keep up with the latest news on the company you want to buy stocks in. If you have a company you are thinking about buying shares in, it is best to keep up with what is going on with them. If they are doing well overall as a company, not just financially, chances are their stock will do well. However, if they are not doing well in any way, their stock value can go down.
  3. Figure out how much in dividends you could earn. Once you find a stock you may want to buy for dividend investing, figure out how much in dividends you may earn in a year. Then divide that amount by either four (if the company pays dividends every quarter) or twelve (if dividends are paid every month).
  4. Find the company’s dividend payment history. First, this will let you know if a company is consistent in paying dividends. Second, this information will tell you if a company pays dividends every month or quarter. Third, it lets you know how much each dividend payout is. This is useful for anyone who is not good at calculating dividends on their own, like me. Finally, this will tell you when and how much the payments went up or down.

Stocks I Own That Pay Dividends Every Month

The stocks I own that pay dividends every month are mainly real estate stocks. Also called Real Estate Investment Trusts, or REITs, these are companies that own real estate. No matter what type of real estate these companies own, they make their money through monthly rent payments from tenants. As a result, they can afford to pay dividends to their shareholders every month. Another type of stock I own that pays dividends every month are bond ETFs.

Real Estate Investment Trusts (REIT)

Putting my money towards REIT stocks was my first exposure to real estate investing. It allowed me to invest in real estate without actually owning it. I did not even start investing in REITs to earn dividends. This became a later goal once I learned what dividends are and how to earn them.

Now, I invest in real estate. However, I would not have the courage to do this without being exposed to REITs first. Below are some of the REITs I own that are a good value and pay dividends every month.

Main Street Capital (MAIN)

A business development company that offers financing solutions to lower and middle-market business owners.

LTC Properties (LTC)

Owns housing for senior citizens and health care properties.

Whitestone REIT (WSR)

A real estate company that deals with commercial buildings in major cities.

Realty Income (O)

Dedicated to paying dividends every month to its shareholders. They get their money from rent collected from retail stores and other businesses.

Bond Exchange-traded Funds (ETFs)

Robinhood defines a bond as an IOU given by a company, government, or institution in exchange for cash. Another form of borrowing money, bonds can also be traded like stocks to other investors. Bond ETFs, like regular ETFs, are a collection of bonds.

At first, I began buying bond ETF stocks because I learned how stable they are. As I bought them, I would notice how these stocks did well in times when other stocks I own did not do well. As a result, these stocks would balance my overall portfolio. They would either prevent my portfolio from losing value at the end of a trading day or limit the amount of loss caused by stocks that were losing value.

A while into owning bond ETF stocks is when I would learn that some of them pay dividends every month. Below are some of the bond ETF stocks I own that pay me dividends every month.

Vanguard Long-Term Bond ETF (BLV)

An index of government, business, and foreign bonds that have at least ten years to mature.

PIMCO Investment Grade Corporate Bond ETF (CORP)

An index of bonds issued by businesses.

iShares 10-20 Year Treasury Bond ETF (TLH)

An index of bonds that are issued by the United States Treasury.

iShares Core US Aggregate Bond ETF (AGG)

An index of the treasury, agencies, and other investment-grade bonds.

Robinhood Gold

I still pay for Robinhood Gold, even though I rarely use it. However, it is a good feature to have on hand if and when the time comes. Since I have been using Robinhood, I have only been on a stock shopping spree once. I spent over $1,000 in one day and had to raise my instant deposit limit. Also, I only use the trade on margin feature when I am low on cash but want to buy a call or put option. However, I barely use it because I do not want to invest with credit. If I do, I have to make sure I can pay it back, plus interest.

Options Trading

This feature is what made me quit using Robinhood at first. When options trading became available, I did not know what I was doing. I read a couple of articles on it and thought I knew what to do, but I did not. I remember buying call options on stocks I could not afford to buy at market price. Since I did not know I was supposed to exercise my options before their expiration dates, I lost money every time.

However, now I am taking the time to learn how to trade options correctly. I see a couple of my friends are using it and they are doing a great job. Also, they are gaining a lot of profits from using this feature. Finally, this is a good alternative to the Forex wave many of my other friends are on right now.

Subscribe for Updates

When you subscribe to my website, in addition to updates, you will receive a free stock worth between $5 and $200 after signing up for Robinhood and linking your bank account!

My Concerns with Robinhood

With all of these features Robinhood offers, you would think they would be considered one of, if not the best company in the world. Unfortunately, that is not the case. First, a lot of Robinhood’s features were released with a lot of problems. It is as if they did not test them enough to make sure they were complete or safe to use.

Also, Robinhood faces more than enough controversy and scandal that prevent them from thriving as they should. Their issues have not only become a public relations disaster but have also become fatal to their users. The major issues with Robinhood I will share stuck out to me the most. They include, but not limited to:

  1. Issues with Cash Management
  2. Security Breaches
  3. System Outages
  4. Apparent suicide over app issues

Issues with Cash Management

I always knew not to bother using Robinhood’s Cash Management feature because it had problems as soon as it was first announced. According to TechCrunch, Robinhood first announced this feature as Robinhood Checking back in December 2018. Also, they promised a 3% interest rate on these accounts. However, the Securities Investor Protection Corporation did not make Robinhood eligible to offer checking accounts. In fact, its CEO said that they never agreed to offer checking accounts.

As a result of this confusion, Robinhood could not make sure that user’s money in these checking accounts would be insured. They had to scrap the entire project. Robinhood did not revive this feature until October 2019, where they promised a 2.05% interest rate. However, when Cash Management was finally rolled out in December 2019, it only had an interest rate of 1.8%. Now, the interest rate is only 0.30% APY, which is nothing.

Security Breaches

When people use an app to add and trade their money, they trust the app to be the most secure in the world. However, Robinhood has broken that trust not once, but twice. In July 2019, TechCrunch reports how Robinhood had to notify their users that their information was not secure.

Nobody’s information was hacked, however, Robinhood did make a mistake. They stored user’s information, including passwords, in plaintext on their system instead of encrypting them. What makes this issue more suspect is Robinhood never shared how the issue was found or how many customers were affected.

Unlike the first security issue, the second one did involve a hack in Robinhood’s system. According to Bloomberg, in October 2020, almost 2,000 accounts were hacked. Hackers were able to gain access to people’s accounts through emails outside of Robinhood. They stole a lot of money out of affected users’ accounts. What makes this situation worse is people had no choice but to complain on social media because Robinhood does not have any phone support. Also, they were not responding to people’s emails quickly.

System Outages

If two security breaches are not bad enough, how about not one, but two system outages during the trading day? Robinhood’s first system outage occurred in March 2020. According to Bloomberg, on the most anticipated trading day for the U.S. stock market, where stocks surged, Robinhood’s system goes out. The outage would last for two days. It prevented users from taking part in the best day on the U.S. stock market before the Coronavirus pandemic began.

To make this issue worst, days after the first outage, Robinhood has another one. However, this time the outage only last for one day instead of two days. Still, Robinhood users were very upset. I would have been one of those upset users. However, at the time I was not actively investing for personal financial reasons.

Apparent Suicide of Alexander E. Kearns

When I heard about this story, it broke my heart. Also, it made me frustrated because it is the most serious issue of them all. After learning about this story and why this young man may have killed himself, I was almost ready to quit Robinhood. They need to get it together, fast.

A CNN article explains how in June 2020, a young man from Plainfield, Illinois name Alexander E. Kearns was found dead from an apparent suicide. His family believes he was misled into thinking he owed Robinhood over $730,000 from trading options. One of his relatives shared how despite having no income, Robinhood gave him almost $1 million worth of leverage.

What makes this story even more sickening is that he never actually owed that much money. Robinhood’s app at the time shows a negative balance when trading options until the other half of a user’s trades are executed. However, they did not make this clear to users who use this feature. As a result, the confusion may have caused someone to want to end their own life.

After this situation, Robinhood quickly acts by announcing a series of changes. First, they are expanding their education to better explain how their trading strategies work, especially options trading. Second, they improve the app’s user interface. 

Changes to the interface of the Robinhood app include:
  • Changing how a user’s buying power is shown.
  • Sending more helpful in-app messages and emails about a user’s options transactions.
  • Change the in-app history page to help users better understand how to trade options.

Final Verdict: Is Robinhood Worth Investing Your Money Into?

Before I answer this question, I do want to share that Robinhood is holding off on plans to expand outside of the United States. I am surprised to learn that they have not already started to expand, given how popular they have become over the years.

However, an article on Barrons writes that the two system outages in March 2020 caused Robinhood to stop their plans to expand into the United Kingdom. They plan on focusing on its core business and improving as much as possible. I believe the apparent suicide of Alexander Kearns added to this decision. No matter what the reason is, I am glad they made this decision. Robinhood has too many issues that do not need to travel to other parts of the world.

As far as if Robinhood is worth investing your money into, it is if you know enough about investing. Now that their options trading feature is cleaned up and includes helpful resources, I recommend it for anyone who wants to earn quick profits. However, if you just want a simple app that lets you invest any amount of money you can, there are better options. For an app that is supposed to gear towards young people, Robinhood is just not an easy app to use, especially for beginners.

If you would like to sign up for Robinhood, I suggest signing up through me so you (and I too) can receive a free stock to help you get started. Thank you so much for reading my Robinhood review. I know it is long, but I hope you find it useful as you embark on your investing journey. Let me know in the comments below what you think. Also, send me a message with your thoughts, questions, or ideas.

Subscribe for Free Stock

When you subscribe to my website, in addition to updates, you will receive a free stock worth between $5 and $200 after signing up for Robinhood and linking your bank account!

This post was originally published on: 08/23/2019

Leave a Reply

Your email address will not be published. Required fields are marked *

Subscribe for a Free Stock Worth at least $5

By subscribing to my website, you will receive email notifications on:

  • Announcements, updates, and events.
  • Newly published blog and portfolio content.
  • Exclusive promotions and discounts from brands I am affiliated with. 
You will also receive a free stock worth between $5 and $200 when you sign up for Robinhood and link your bank account.