In this Twine app review, I’ll explain how the app works, its strengths and weaknesses, and how it can help you (and a partner) reach your savings goals.
Have you ever wished there was a tool that could help you save toward a big goal? Something that could keep track of multiple goals, transfer money for you, and monitor progress?
Good news: that tool exists, and it’s called Twine. Let’s take a look and see if it’s right for you.
Twine at a Glance
- Saving and investing app for iOS (also available on the web)
- Allows partners to work toward a joint goal
- No-fee savings account
- Investment portfolios for $0.25 per $500 invested a month
- FDIC and SIPC Insured
- Owned by John Hancock
What is Twine?
Twine is a savings and investment app that helps you and a partner work toward a shared financial goal. The app connects to your bank account and helps you reach your goals faster through the magic of automation.
Twine’s full list of features is currently available as an iOS app, and a limited amount of features can be accessed through a laptop or desktop browser. Plans for an Android version are in the works.
Twine: How It Works
When you sign up for Twine, you connect your bank account so you can set up automated savings. You can do this with their search function or by providing your account and routing numbers. Obviously, using the search function is easier, but smaller banks and credit unions may not be listed. In this case, it may take a couple of days for Twine to verify the account.
Once your bank account is connected, you set a savings goal. It can be anything: saving for a new car, a down payment on a home, a dream vacation, or maybe even an emergency fund.
Once you’ve defined a goal, you tell Twine how much you want to contribute toward it each month. They’ll debit your connected bank account on a weekly basis and move the funds into the brokerage account for that goal.
Each goal has its own brokerage account, and you choose what you’ll do with the money. You can save it as cash and earn a modest interest rate or you can invest it in one of three investment portfolio options (more on that in a minute).
Once you’ve reached your savings goal (or before, if you need to), you can withdraw from your Twine account by making a request through the app. Cash savings take 2-3 business days to reach your linked bank account, while invested funds can take up to 7-10 days.
Twine is advertised as a service for couples because it allows you and your partner to both link your individual accounts and contribute to a shared goal. It’s especially useful for couples who may not share all their finances but want to work toward a goal together.
For example, if you and your partner are saving to buy a home but haven’t combined finances, you can set a goal together and then each chooses the amount you’re able to contribute every month. Maybe you can spare $200, but your partner can only swing $150. You each link your accounts and Twine will make the withdrawals and move the funds into your individual brokerage accounts.
It’s important to understand that, if you and your partner open Twine accounts today, you can track and contribute to a shared goal; you will, however, maintain separate individual brokerage accounts. Additionally, you’ll only have direct access to the funds you contribute. Prior to November 2018, Twine offered true joint brokerage accounts, but this type of ownership is no longer available.
Of course, you can share a savings goal with anyone; it doesn’t have to be your partner. And if you’re not interested in bringing anyone else into the picture, you can use Twine for your solo goals, too.
No-Fee Savings Account
As I mentioned earlier, for each goal you set in Twine, you choose how you’ll put your money to work. For short-term goals, like a vacation, you’ll probably want to keep your funds in a zero-risk cash account. The same goes for funds you might need to access anytime, like an emergency fund.
Twine’s no-fee cash savings account is a good solution. You’re paid interest on a monthly basis and assume no risk. Well, no risk up to $250,000, anyway—Twine savings balances are insured by the FDIC up to that amount.
So, what kind of interest rate are we talking about? The rate varies based on federal rates, but as of June 2019, it’s 1.05%. That’s much higher than the rate you’ll likely get at a brick-and-mortar bank.
Three Investment Portfolios
If you’re interested in earning potentially greater returns on your money, you can invest in one of Twine’s three investment portfolios. In that scenario, your money goes into a managed brokerage account.
Twine will ask you a series of questions about your financial situation, goals, and risk tolerance and recommend the portfolio that best suits your needs.
Each portfolio comprises exchange-traded funds (ETFs) and/or mutual funds. As you get closer to your goal, Twine adjusts your asset allocation to reduce risk.
The three investment portfolio options are:
Regardless of the portfolio you choose, the fee for the service is 0.6%, which amounts to about $0.25 a month for every $500 invested. Twine brokerage accounts are SIPC insured up to $500,000.
Benefits of Twine
Automated Saving/Investing – The best way to reach a savings goal is to prioritize that goal by paying yourself first. Twine takes the work out of saving by letting you automate it and channel the funds into accounts for specific goals.
No Fee to Use the Savings Account – Savers seeking a no-fee option will enjoy the goal-setting and tracking perks of Twine paired with the high-interest savings account, all for no fee.
Better Savings Rate Than Traditional Banks – Twine’s no-fee, no-risk savings account pays a higher interest rate than most big banks (although higher rates are available from online-only high-yield savings accounts).
Easy to Work Toward a Shared Goal – Twine makes it easy for you and your partner (or anyone, really!) to contribute to a common goal. You can both track progress, but your funds will be maintained in separate brokerage accounts. This makes it a great option for friends or business partners and for couples who haven’t combined finances.
FDIC and SIPC Insured – Twine’s savings account is FDIC-insured up to $250,000. That means your funds are safe if anything happens to Twine. The investment accounts are SIPC insured up to $500,000. That means you’re protected if Twine fails financially. It’s important to understand that SIPC insurance does not protect the value of your investments. If you choose to invest your money in the market, you automatically assume some degree of risk.
Where Twine Falls Short
It’s Only Available in the U.S. – At this time, Twine can only support U.S. and Canadian phone numbers, and you need to be a U.S. resident to join.
The Aggressive Portfolio Isn’t That Aggressive – If the timeline for your goal is less than 5 years, Twine’s “aggressive” portfolio contains mostly money market and bond ETFs. To get a portfolio that’s mostly stock ETFs, your timeline has to be at least 15 years. If you have a high-risk tolerance and this is your “play money”, you might find these restrictions limiting.
There’s no Android App – Right now, Twine doesn’t offer an Android app, although they say it’s on their radar for the future. You can use Twine on the web, but you won’t have access to all the same features as iOS users.
There Are No Retirement Accounts – Twine doesn’t offer IRA or Roth IRA accounts, so it isn’t an ideal tool for retirement savings.
Who Should Consider Twine?
- Anyone with a Savings Goal – If you have a savings goal in mind, using an app like Twine to automate savings specifically for that goal can be a powerful tool to help you get there.
- Couples Working Together on a Shared Goal – Twine helps couples save for a joint goal by allowing each person to link their account, automate weekly savings they’re comfortable with, and track the team’s progress. The goal is shared, but the brokerage accounts aren’t, making this feature appropriate for any two people interested in saving up for something together.
- People Who Aren’t Good at Paying Themselves First – If you struggle to make savings a priority by paying yourself first, using an app like Twine takes the work out of it for you. Just set your goal and the amount you want to save monthly and Twine will debit your linked account every week.
- No-nonsense Investors – People who don’t want to mess around with choosing their own ETFs or building asset allocations will like Twine’s system: answer some questions about yourself and let them make the recommendation.
Who Should Avoid Twine?
- Anyone with a Short Timeline Who Wants an Aggressive Portfolio – If you have a high-risk tolerance and are looking for mostly stock ETFs, the “aggressive” portfolio might not be aggressive enough for you.
- Active Investors – Twine isn’t suited to hands-on investors who want to choose their stocks and build their own portfolios. If that’s more your style, you’ll want a self-directed brokerage account.
- Investors Looking for the Lowest Fees – While Twine’s savings account is free, you’ll pay 0.6% to use their investing service. This is pretty low, but there are lower-cost options available.
How to Open a Twine Account
If you’re ready to get going, you can sign up for a Twine account here. From there, you’ll link your bank account and set your first goal. Remember, each goal gets its own brokerage account.
Twine App Review: The Bottom Line
Twine is a great app for people looking for a technological solution to setting, tracking, and contributing to a savings goal. It’s especially useful when two people want to collaborate and work on a goal together.
Could you just open a high-yield savings account (or an investment portfolio with a robo-advisor) and set up an automated transfer every week? Sure, but you wouldn’t get the elegant goal-setting and tracking that’s built into Twine. At the end of the day, you have to decide if Twine’s goal-setting, tracking, and collaboration features are worth it to you.