Moneybox launches three new ready-made funds and cuts its fees
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Investment platform Moneybox has launched three new actively managed ready-made funds and cut its fees for those who want to invest in them.
Ready-made funds are handy for those who prefer to leave investing to experts. You just need to choose your attitude to risk based on your goals.
You can buy the new funds within Moneybox’s investing accounts, including its stocks and shares Isa and personal pension.
Moneybox charges 0.15 per cent in account fees for these funds, as opposed to 0.45 per cent for other investments.
It has also scrapped its £1 a month subscription fee for those with £5,000 or more across qualifying investing and savings accounts.
Moneybox has launched the three funds in partnership with the investment manager Amundi. They have different risk profiles – cautious, balanced and adventurous.
Rounding-up: Moneybox started as an app that invests your spare change
How do Moneybox’s new fees compare with other platforms?
Moneybox is aimed at novice investors, as well as those who might have managed investments elsewhere and are keen to cut costs.
The fee cuts now make it more competitive against some of its closest rivals including AJ Bell Dodl, Monzo and Plum.
You can see how the fees stack up against different platforms below:
| Annual admin charge | Choice of investments | Other notes | ||
|---|---|---|---|---|
| AJ Bell Dodl* | 0.15%, minimum of £1 a month | Eight ready-made funds, selection of ETFs, UK and US shares | Part of the larger investment platform AJ Bell, founded in 1995 | |
| Moneybox | 0.15% for own ready-made funds, 0.45% otherwise | Three ready-made funds, selection of ETFs, US shares | £1 a month subscription fee on top of account fee, waived if you have £5k or more with Moneybox | |
| Monzo | 0.25% or 0.2% for paid Plus, Premium, Perks or Max account holders | Three ready-made funds, selection of themed funds (ETFs) | Capped at £250 (or £200 on paid plans). No fees on Isa or investment account if you have Aura credit card | |
| Plum* | £3.99 a month for Plus, £14.99 a month for Premium | 26 mutual funds, 3,000+ stocks | Full range of investments only available on Premium | |
| Source: This is Money, published information on providers' websites | ||||
AJ Bell Dodl* also has an annual charge of 0.15 per cent of the value of your investments and the minimum you’ll pay is £1 monthly.
For those with less than £5,000 to invest, AJ Bell Dodl should work out cheaper because of Moneybox’s extra £1 charge on top of its platform fee.
AJ Bell Dodl also has a wider range of ready-made investment portfolios, with six growth funds, one ethical fund and one pension builder fund available.
However Moneybox has a broader range of financial products on offer for those who prefer to manage more of their money in one place. It offers cash savings products and has built a reputation as a champion of the lifetime Isa (Lisa).
Its cash Lisa is currently sitting at a strong rate of 4.65 per cent, which includes a fixed 1.85 per cent boost for 12 months.
Just beware that if you decide to transfer out of the Lisa after a year, Moneybox’s terms mean that you can’t then reopen it if you want to move back to the platform.
This is Money says...
If you’re keen to start investing but aren’t sure where to begin, you could do worse than Moneybox now it has cut fees on its ready-made funds.
A 0.15 per cent platform charge is competitive, as is the underlying 0.29 per cent fund management fee.
Taken together you’ll pay 0.44 per cent a year. This is cost effective for actively managed investments aimed at beginners.
Having different pricing tiers does risk creating a confusing fee structure however, which is something that legacy investment platforms such as AJ Bell*, Fidelity* and Hargreaves Lansdown* struggle with.
Retaining the expensive 0.45 per cent platform charge on other investments means that Moneybox customers are more likely to choose the cheaper funds.
If you are more of a do-it-yourself investor who wants a wider range of investments than Moneybox's ready-made ones, have a look at lower-cost platforms like Freetrade* and Trading 212*.
You can read our guide to investing for beginners if you'd like to get started but aren't quite sure how.
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