What if there was a way that you could save and invest your spare change, without having to manage it yourself?
You’d say that I sound like a bit of an idealist.
Well, what if I told you that there is a company out there that goes by the name of Moneybox, which aims to achieve just that.
But are they any good and even if they are, is it really worth it?
By the end of this Moneybox review, we’ll be able to answer both questions confidently.
What Is Moneybox?
Moneybox was founded in 2015 by Ben Stanway and Charlie Mortimer.
As I alluded to in the introduction, its main purpose is to help people save and grow their money.
The company has positioned itself in such a way that it appeals particularly, although not exclusively, to new investors.
In other words, people who want to invest their spare change but don’t know where or how to get started.
By handling all the investments themselves, Moneybox enables users to save and invest ‘hands-free’.
That way people can go about their everyday lives knowing that they have a saving and investing system in place behind the scenes.
Today, over 450,000 people save and invest with Moneybox.
How Does It Work?
Moneybox is made possible via their app which can be downloaded on both Android and IOS devices.
(Note: You have to be 18 or over to open an account with Moneybox)
Signing up takes a couple of minutes and you can start saving with as little as £1.
You’ll be asked to connect your bank accounts to enable its two primary saving features.
These consist of:
- Roundups
- Direct debits
We’ve all heard of direct debits, but Roundups work by taking your spare change, up to the nearest pound on your purchases.
So say for example you spend £1.50 on a coffee, Moneybox will then round it up and save 50p for you.
(To see the full list of banks that support roundups, click here)
Over time, the idea is that this will build up, along with the potential returns on the investments made by Moneybox.
MoneyBox’s Account Types
When it comes to investing with Moneybox, they have a variety of investment products for you to choose from.
So it’s only right in this Moneybox review we cover all of them.
Stocks & Shares ISA
Stocks and shares ISAs allow you to invest up to 20,000 a year tax-free.
Your round-ups and/or direct deposits can be funnelled into this account type to be invested in the stock market.
This gives you exposure to thousands of publicly traded companies around the globe.
Just remember that investing always carries risk and you can walk away with less money than you put in.
A socially responsible option is also available for those of you who want to invest only in ethical and/or green companies.
Here are the fees associated with moneybox’s stocks & shares ISA.
| Stocks & Shares ISA | |
|---|---|
| Subscription Fee | £1 fee/month (Free for the first 3 months) |
| Platform Fee | 0.45% of the value of your investments per year |
| Fund Provider Fee | 0.12% to 0.30% |
Lifetime ISA
Lifetime ISAs are used for people who are looking to buy their first home or use it for retirement.
Account-holders can deposit up to £4,000 a year and in return, they’ll receive 25% on top from the government.
On top of that, Moneybox offers an interest rate of 0.85%- including a 0.5% variable rate and a 0.35% bonus for the first year.
You can get started for as little as £1.
Just be aware that if you withdraw the funds for other reasons than those mentioned above you’ll pay a 25% penalty.
| Lifetime ISA | |
|---|---|
| Subscription Fee | £1 fee/month (Free for the first 3 months) |
| Platform Fee | 0.45% of the value of your investments per year |
| Fund Provider Fee | 0.12% to 0.30% |
Savings Account
Moneybox has what’s known as a short term goals account which gives you access to slightly higher interest rates.
Moneybox says these are ideal for those of us that want to work towards our short term goals.
You have two options to choose from, each with its own characteristics.
95-day notice account:
- 0.6% AER (variable)
- Give 95 days notice before withdrawal
- Continue to earn interest in the withdrawal period
- Save up to £85,000
- Weekly deposit limit of £20,000
- Powered by Investec
- No account fees
- Continue to earn interest in the withdrawal period
45-day notice account:
- 0.45% AER (variable)
- Give 45 days notice before withdrawal
- Continue to earn interest in the withdrawal period
- Save up to £85,000
- Powered by Charter savings bank
- No account fees
Personal Pension
By using round-ups and merging all your old pension pots into 1, Moneybox could be a good option for you.
As with all pensions, you’ll receive a 25% tax relief from the government.
However, here are a few things to consider:
- Moneybox can’t accept transferrals from your provider(s) if they charge you to leave
- Or if you might lose guaranteed benefits
- Moneybox doesn’t currently offer drawdown products
- Annual allowance of £40,000
Junior ISA
Junior ISAs can be opened by parents or guardians for anyone under the age of 18.
Like a stocks and shares ISA, all funds are invested in the stock market but junior ISAs have a limit of £9,000 a year (subject to change) tax-free.
Once the child turns 18, the funds are automatically transferred to them.
Also bear in mind that money cannot be withdrawn from the account before the child is 18 unless a significant event occurs.
You can get started for as little as £1.
| Junior ISA | |
|---|---|
| Subscription Fee | £1 fee/month (Free for the first 3 months) |
| Platform Fee | 0.45% of the value of your investments per year |
| Fund Provider Fee | 0.12% to 0.30% |
General Investment Account
General investment accounts are used when individuals have reached the maximum limit for their stocks and shares ISA.
This form of account does not have the same tax benefits and your returns are subject to 20% tax.
The one major benefit of having a GIA is that it has no limit to the amount of money you can hold in the account (maximum deposit of £20,000 a week).
| General Investment Account | |
|---|---|
| Subscription Fee | £1 fee/month (Free for the first 3 months) |
| Platform Fee | 0.45% of the value of your investments per year |
| Fund Provider Fee | 0.12% to 0.30% |
MoneyBox’s Investment Styles
After choosing your account type, you can choose 1 of 3 investment styles that most suit your tolerance to risk.
Bear in mind these investment styles only apply to these accounts types:
- Stocks & Shares ISA (Including socially responsible option)
- General Investment Account
- Pension Account
Here are the investment style labels:
- Cautious– Modest growth with reduced risk
- Balanced– More growth with more risk
- Adventurous– High growth with a heightened risk
Each investment option is optimised by experts at Moneybox and these starting options are comprised of tracker funds.
Tracker funds simply mimic broad market indexes, recreating their holdings and performance.
You can customise the asset allocation but just make sure you understand the implications of doing so.
Is Moneybox Safe?
Moneybox is regulated by the financial conduct authority (FCA) which upholds a strict and strong set of guidelines/rules.
The main goals of the FCA are to:
- Safeguard customers
- Strengthen the integrity of the Uks financial system
- Promote healthy competition in the interests of consumers
Aside from that, investment products are protected by the financial service compensation scheme (FSCS) up to £85,000.
The only fund they use which is not protected by the FSCS is the old mutual world ESG index fund.
This is because they are situated in Ireland and therefore adhere to different rules.
Moneybox Competitors
Being in such a competitive space, it’s only right in this Moneybox review that we compare them to other industry companies.
Below are just a handful of alternatives to Moneybox.
(If you want to look at a range of potential candidates, check out my reviews section)
Moneybox Vs Plum
Plum is predominantly a savings app that utilises AI to put money aside for you each week.
Like Moneybox, you can enable roundups, amongst other things to help increase your savings.
Plum differs when it comes to accounts types- only offering a free savings pocket (0.35%) and the option to invest in a choice of funds.
To read more about plum, I recommend reading my review which is linked below.
Related: Plum Review
Moneybox Vs Chip
Chip is purely a savings app and currently offers no investment products (this may change soon).
Its strengths lie in its simplicity and effectiveness, it ‘does what it says on the tin’.
If you are purely looking for something that can help you save and are put off by the risk of investing, Chip could be an option for you.
Chip does charge a fee, albeit small at £1 for every time the app saves you £100 through their automatic savings feature.
They have also recently introduced their ‘interest accounts’ which pay a 0.9% rate, which could interest some of you.
To read more about chip, check out my review linked below.
Related: Chip Review
Moneybox vs Nutmeg
Nutmeg is a digital wealth management company and so it’s more tailored to growing your money through investments.
That said, it provides similar account types to that of moneybox including:
- Stocks & Shares ISA (including socially responsible option)
- General Investment Account
- Pension
- Junior ISA
You also have options when it comes to risk tolerance, up to 10 different levels for some account types.
In summary, if you don’t have a problem saving, this may be better suited to you.
If you would like to read more about Nutmeg, check out the review below.
Related: Nutmeg Review
Moneybox Reviews
According to Trustpilot, Moneybox has an overall rating of excellent from over 1300 reviews.
78% of the moneybox reviews gave a rating of 5 stars while 8% rated them as bad.
Positive Moneybox reviews include things like:
- Excellent service
- Easy to use
- It’s really helped me save
Negative Moneybox reviews tend to touch on things such as:
- Customer support
- Difficulties withdrawing money when users closed their bank accounts
- Problems deleting accounts
Customer service does tend to be a subjective experience and in some instances, they’ll be issues in which the customer feels unsatisfied.
This is a problem every business has.
When it comes to trying to withdraw to a different account, companies in the finance sector are under strict rules and obligations.
This is to ensure no fraudulent activities are taking place through their platform.
Nevertheless, I can understand some people’s frustration.
FAQS
Is Moneybox Worth It?
When questioning a services’ worth, it’s hard to say since it’s subjective by nature.
Factors such as your tolerance to risk and overall market conditions will be the key players in your returns and ultimately, your judgement on whether or not you think it’s worth it.
However, I will say that putting money aside each month for investment is a healthy practice in broader terms.
Is Moneybox Legit?
Moneybox is regulated by the FCA, meaning they have to adhere to strict rules and regulations to offer financial services to the UK public.
So rest assured Moneybox is 100% a legitimate company.
Who Owns Moneybox?
Moneybox is owned by its co-founder, Ben Stanway.
Is Moneybox Good?
This question is subjective in nature- making it hard to give a response that will represent everyone.
But what I will say is, in my opinion, Moneybox is good for those of you who are new to investing and are looking for a ‘hands-off approach.
Verdict Of This Moneybox Review
Now this Moneybox review is drawing to a close, I hope you have a better idea of what they are all about.
The concept of Moneybox is a good one- allowing users to save and potentially earn returns when they spend.
The variety of accounts is also useful for those of us at different stages in our lives.
Having said that, this app feels like more of an introduction to investing- yet it has no educational component to it.
This may suit some people, but the likely slow returns from small amounts invested could put some people off investing for good.
That would be a great shame.
When it comes to saving with the app, roundups are really its only feature.
There are plenty of other savings apps out there which have a multitude of additional savings features.
In conclusion, I think that Moneybox is suitable for those of you who are new to investing and aren’t too fussed about learning more about it.
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Equally, if you have any questions about this Moneybox review, drop a comment and I’ll answer as soon as I can.
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