It’s a lot harder to find a savings account with a good interest rate than it was when I started blogging about personal finance over a decade ago.
Back then, you could pretty easily find a savings account that would pay 3-4% APY on your money. While that isn't going to make you rich, at least your emergency fund isn't losing value to inflation every year.
These days you're lucky if you can find a savings account that will pay 0.50% APY, and keeping any amount of money in a traditional bank is a losing proposition.
I recently opened a crypto savings account where I am earning 8.8% APY on my crypto stablecoins. While there is risk involved, and it's a relatively new idea, I've already earned more interest in that account in 2 months than my much larger savings account did all year last year.
I have dabbled in real estate crowdfunding with sites like Groundfloor as well, earning almost 10% interest on my invested funds. Again, there is risk, but it has performed well so far.
Groundfloor recently released a new saving and investing app called Stairs by Groundfloor. The app allows you to invest your money and earn 4-6% APY on your cash, without locking the money up for months at a time. Just setup automatic transfers and start earning. Withdraw when you need the money.
In this Stairs app review we'll take a look at this new "savesting" service, and help you to figure out if it's right for you.
- App is free to use.
- Save automatically.
- Earn 4-6% interest.
- Withdraw at any time.
What Is The Stairs App?
Stairs by Groundfloor is an app where you can earn a guaranteed 4-6% interest rate on the money that you deposit. While the app is technically an investing app, it looks and feels like a typical savings account app.
You deposit money, it earns interest. Withdraw at any time.
The only difference is that you are investing your money in non-traded, secured debt notes with Groundfloor. The notes are backed by tangible assets, which in this case is real estate. This allows you to earn a higher rate of interest than you would get in a traditional bank account, and more predictable returns than being in the market. It also allows Groundfloor to get more flexible terms when originating real estate loans on their end. So everyone wins!
“Eight years ago, we launched GROUNDFLOOR as a completely new concept and in a brand new category, opening up the idea of direct real estate investing to everyday people in a new way, without forcing them into a fund,” said co-founder and CEO Brian Dally. “Now, with the launch of the Stairs app, we’re taking another big swing to reimagine how anyone can start saving and investing better, getting the advantages of investing in alternatives with the security of real estate backed loans.”
If you already use Groundfloor you may have already invested in Groundfloor Notes, secured promissory notes issued and secured by the assets of Groundfloor. While you can get a bit better returns if you invest in those notes directly, you won't have the flexibility of Stairs, your money will be bound up in those notes until they come to maturity up to 12 months later.
With Stairs you invest in those same notes, while getting much more flexibility and a slightly lower rate. Definitely worth it, especially if you are looking to earn some good interest over a shorter term while keeping your cash liquid.
Saving + Investing: Savesting?
In their promotional materials Stairs says they came up with the idea for the app because they wanted to offer a product that offered better returns than the typical savings account, while avoiding the up and down rollercoaster of short-term returns in the stock market. Why subject yourself to market conditions if you don't have to?
Their app offers the easy access of a savings account, while giving you the real returns of real estate investing. They combined "saving" and "investing" into this "savesting" app from Stairs.
Signing Up For A Stairs Account
Signing up for a Stairs account is extremely simple. The only requirement is that you need to have a smartphone as the service is only available via their Android and iOS iPhone platform apps. Download them through the App Store or Google Play via our link below.
To get started follow these steps:
- Click the link to go to the Stairs site and download the app: Stairs App Download.
- Register a new account. (Or login with your existing Groundfloor account if you already have one).
- Link a funding bank account via Plaid.
- Transfer your first deposit.
Pretty simple to get started, I was up and running within a few minutes and was able to initiate my first deposit the same day.
What Interest Rate Will I Earn?
When you transfer your money to Stairs you'll likely want to know what kind of a return you'll be getting on your money right away, especially since Stairs advertises that you can get returns of 4-6%. Who gets 4%, and who gets 6%?
Here's how it works.
- All deposits to the Stairs app qualify for the 4% APY annual interest rate. Everyone gets this.
- If you set up a recurring transfer and you'll get an additional 1% APY on your balance (90 days after it's activated).
- Turn on "round-ups" to get an additional 1% APY on your balance (90 days after it's activated). When you make a purchase on your linked account, Stairs will round up your purchase price to the next whole dollar, and then invest that amount.
So to recap, everyone gets 4% APY on their deposits. If you turn on recurring transfers and round-ups, after 90 days you'll get an additional 2%. Easy.
Automate Your Investments
As mentioned above you can automate your investments with Stairs in a couple of different ways, and doing so will give you additional interest on your balance. (Each one gives you an additional 1% APY).
In your app's menu under "Account Settings/Investments" you can turn on these two types of automated investments.
You can make a recurring investment in the app by turning this feature on, and then entering a dollar amount. It will then ask you to choose a day of the month for the recurring transfer to take place and you're all set.
Once you turn this on, every month on that same day a transfer will be initiated from your linked account, and invested in the Stairs app.
Turning on round-ups and investing is as simple as toggling the switch in the app to turn them on. When you turn round-ups on the Stairs app will monitor your linked bank account and round up any purchases to the next whole dollar, and invest that amount.
For example, if you buy a coffee for $3.50, it will round up the purchase to $4 and invest the $0.50 cent difference in the Stairs app. Invest your spare change!
Is Stairs App Safe?
So the question needs to be asked, is the Stairs app safe, or is it a scam?
Stairs was launched by a company, Groundfloor, with a long history (7+ years) of being an innovator in the real estate crowdfunding space. They are a legitimate company, and they stand behind their products. I've personally had an account with them for several years now and have been happy with them.
Beyond the company itself being legit, there are other things to consider, for example, the safety of your money. Could you lose your money?
Investment Backed By Assets
Investments in the Stairs app are a debt note, and it is backed by a real tangible asset, the real estate associated with these notes.
No FDIC Insurance
Funds transferred to Stairs are not FDIC insured. Since the account is not a traditional checking or savings account from a bank, FDIC insurance is not applicable to this account.
This account is a debt note investment. The investments are backed by non-traded secured debt notes. Like CDs or corporate bonds, debt notes offer consistent, fixed repayment dates and are backed by real, tangible assets (in this case, real estate).
So while this investment is not FDIC insured, it is secured by a lien on the residential properties in the applicable debt notes, and that makes it relatively safe.
Stairs App Fees And Minimums
One of the most important questions to ask when researching new investing products is, how much will this cost me? Are there monthly fees, or an annual management fee for assets under management? Are there fees to withdraw my money, or limits to the number of withdrawals I can make? Let's take a look.
- Account minimum: None.
- Fees: None.
- Deposits: Transfer up to $5,000 per week into Stairs.
- Withdrawals: Withdraw at any time.
When you withdraw or deposit funds it can take 1-3 days for the funds to be available after it posts.
So when signing up for Stairs, there are no fees, no minimum balances, a minimum investment of only $1, and no fees to worry about cutting into your returns. The only limit I see is the $5,000 deposit per week maximum.
Stairs by Groundfloor - A Decent Way To Earn Higher Interest
If you're looking for a good place to park your money where you can earn better interest than you're earning in a traditional savings account, and you want to ensure your money stays liquid, Stairs may be a good option to add to your investment portfolio.
They offer investors up to 6% APY on their money, you can withdraw it at any time, and you can even automate your investments to keep your stash growing.
There are places that you can find better returns on your money long term, especially if you are able to lock the money up for an extended time. If you're looking for an extremely liquid, short term investment with guaranteed returns, this is definitely a good app to check out.
If you are OK with your money being a bit less liquid, you may want to check out Stairs parent company, Groundfloor, where they advertise closer to 10% returns. Check out our review below.
Frequently Asked Questions
What Is the Stairs by Groundfloor app?
Stairs by Groundfloor is an investing app that gives you a guaranteed 4-6% APY in interest.
What fees does Stairs app charge?
There are no fees, no minimum balances, and only a $1 minimum investment.
What platforms is Stairs by Groundfloor available on?
Stairs is available on iOS and Android mobile platforms. There is no desktop or web version currently available.
Is Stairs an saving or investing app?
Stairs offers the benefits of a traditional savings app, but it's actually an investing app backed by non-traded secured debt notes.
Is the Stairs account FDIC insured?
The account is not a savings account from a bank, but an investment account. As such FDIC insurance does not apply.
How much interest will I earn with Stairs?
All deposits currently qualify for the 4% APY interest rate. By setting up a recurring transfer and turning on round-ups, you can earn an additional 2% APY (6% total).
Can I withdraw my Stairs balance at any time?
You can withdraw your money at any time and your funds typically arrive in your bank account in 1-3 business days.