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When you invest money, your capital is at risk. Investments can go down as well as up in value, so you could get back less than you put in. A rule of thumb is to hang on to your investments for at least five years to give them the best chance of providing the returns you are hoping for.
Below, we compare two of the best investment apps in the UK - Nutmeg and Moneyfarm.
Nutmeg gives you the option to invest via a Stocks and Shares ISA, Lifetime ISA, Junior ISA, General Investment Account, or Personal Pension, whereas Moneyfarm offers investments via a Stocks and Shares ISA, General Investment Account, or Private Pension. Both apps are UK robo advisors and offer formal financial advice.
Use the tabs below to learn more about the similarities and differences between Nutmeg and Moneyfarm.
With Nutmeg, you can invest through one or more of the following products - Stocks and Shares ISA, Lifetime ISA, Junior ISA, General Investment Account, and Pension.
Once you decide what product you want to go with, you need to pick an investment portfolio. Here's a breakdown of how they work:
Fixed Allocation Portfolio (Cheapest): This is a passively managed investment portfolio. It keeps you invested in assets that match your risk level, and Nutmeg only reviews those assets once a year to make sure they're still right for you.
Fully Managed Portfolio: This is an actively managed portfolio. An active portfolio means Nutmeg will regularly make strategic adjustments to try and protect against losses and boost returns. Active portfolios are usually more expensive than passive portfolios.
Smart Alpha Portfolio: This portfolio is actively managed by J.P. Morgan Asset Management.
Socially Responsible Portfolio: Also an actively managed portfolio, the investments here are tilted towards companies and bond issuers with high environmental, social and governance (ESG) standards.
Click here to learn more about Nutmeg’s portfolios.
It's completely free to download the app. Then depending on how you choose to invest, the fees are as follows:
To make sense of the charges, use our robo advisor charges comparison table.
Fixed Allocation Portfolio (Cheapest):
Fully Managed Portfolio:
Smart Alpha Portfolio:
Socially Responsible Portfolio:
Nutmeg's Fixed Allocation Portfolio is the cheapest of the four portfolios. Use our robo advisor charges comparison table to get a sense of how Nutmeg's Fixed Allocation Portfolio compares to other robo advisors in the UK.
Nutmeg is beginner-friendly. The website is clear and concise, and they have an easy to use app which you can download on iOS or Android.
The app allows you to make ad hoc investments or regular payments via direct debits. You can also monitor the performance of your investment and make changes to them when it suits you via the app.
Nutmeg's Fixed Allocation Portfolio adopts a passive investment strategy.
When you invest with Nutmeg, your money is protected by the Financial Services Compensation Scheme (FSCS) up to a maximum of £85,000. This means you can get your money back if Nutmeg were to go bust. Note that the FSCS does not cover losses arising from the performance of any of your investments.
Yes, Nutmeg is authorised and regulated by the Financial Conduct Authority (FCA). Have a look at their permissions on the FCA Register.
Yes. If you refer friends to Nutmeg, when they invest, they will pay no Nutmeg management fees for six months. Nutmeg will also reward you with a choice of gift vouchers worth £50 - £100. You can choose from Amazon.co.uk, John Lewis and Partners, Prepaid Mastercard, Currys PC World and Deliveroo.
Visit Nutmeg’s website here.
With the Moneyfarm app, you can invest through a Stocks and Shares ISA, General Investment Account or Private Pension. Users also benefit from free and personalised digital investment advice from Moneyfarm’s investment consultants.
Once you’ve completed a questionnaire specifying your investment goals, risk preferences and financial habits, Moneyfarm will recommend a selection of its seven risk-rated portfolios.
These range from 1 for the lowest risk, to 7 for the highest risk product. Portfolios on the lower end of the scale mostly comprise of lower-risk level fixed-income investments, including government, corporate and emerging market bonds.
For example, Portfolio 1 makes up 53% cash and short-term government bonds, whilst Portfolio 7 comprises 66% developed markets equities.
Moneyfarm has a minimum investment amount of £500.
It's completely free to download the app.
Then Moneyfarm charges a management fee depending on how you choose to invest. Management fees cover all of your Moneyfarm products and are calculated as follows:
Fees are calculated daily based on the total market value of your portfolio.
On average, you’ll be charged 0.2% per annum in exchange-traded funds (ETF) fees. This is built into the cost of the ETF on any given day, so you won’t see fund charges being deducted from your portfolio directly.
To make sense of the charges, use our robo advisor charges comparison table.
Moneyfarm falls into the mid-price range category. Use our robo advisor charges comparison table to understand how Moneyfarm compares to other robo advisors in the UK.
Moneyfarm is beginner-friendly. The services are designed to make personal investing more accessible to the average person by arranging and managing your investments for you.
It’s a great starting point for those who want to watch their money grow without dealing with the nitty-gritty details of investing.
You can use the Moneyfarm app, which is available on iOS and Android, to view your portfolio information and monitor your investment performance.
No. Although Moneyfarm uses exchange-traded funds (ETFs) and other passive trackers, the investment portfolios are actively managed by the team at Moneyfarm. Click here to learn more.
When you invest with Moneyfarm, your money is protected by the Financial Services Compensation Scheme (FSCS) up to a maximum of £85,000. This means you can get your money back if Moneyfarm were to go bust. Keep in mind that the FSCS does not cover losses arising from the performance of any of your investments.
Yes, Moneyfarm is authorised and regulated by the Financial Conduct Authority (FCA). Have a look at their regulatory permissions on the FCA Register.
No.
Visit Moneyfarm’s website here.
Every month, we’ll send you The Plug - a curation of the best personal finance content in the UK. We share real-life stories, how-to guides, top personal finance news, popular community questions, and tips to help you stay on top of your money.
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