Moneybox, Plum Investment App (Not an ISA)

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jxggxr
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Hey, I want to start investing some spare money and I've been thinking of setting up a General Investment Account on moneybox or Plum. (I already have an ISA). Which app is best to do this, and does anyone have an investment account and what do they recommend? Thanks
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ch0c0h01ic
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(Original post by jxggxr)
Hey, I want to start investing some spare money and I've been thinking of setting up a General Investment Account on moneybox or Plum. (I already have an ISA). Which app is best to do this, and does anyone have an investment account and what do they recommend? Thanks
What are you saving for and what is your timescale?

Short term (eg; university, house deposit) - high interest savings would be best or a LISA. You can get up to 2.75% interest with no risk to capital or a 25% bonus with regards to the L-ISA (something that you are exceedingly unlikely to beat with investments).

Medium to long term (eg; early retirement planning, paying for kids tuition fees) - stocks and shares ISA, ideally low cost index trackers (eg; FTSE Global All Cap) in conjunction with a low cost platform (eg; Vanguard, Cavendish)

Long term (eg; retirement) - maximise workplace pension contributions, and consider making additional payments via salary sacrifice (more tax/NI efficient). If you're that savvy consider doing a partial pension transfer periodically to a low cost SIPP platform periodically (eg; Vanguard, Cavendish) to reduce ongoing management charges.

Avoid "General Investment Accounts" unless you are a higher rate taxpayer and have already exceeded your ISA and SIPP limit.

S&S ISAs, SIPPs and salary sacrifice via workplace pensions are far more tax efficient (= greater potential for investment growth/profit long term to lower earners).

Avoid MoneyBox and Plum

Plum or Moneybox is only really applicable to people with no/little financial discipline. However if you fall into this grouping arguably you would save significantly more by following a budget and sticking the difference in a high interest savings account.

Their monthly fees and ongoing charges are relatively expensive compared to low cost providers and their range of funds is very limited.

What concerns me more is that they're not particularly transparent about the composition and diversification of their funds. What are you actually paying for?

My advice would be to set up an inexpensive S&S ISA with Vanguard or Cavendish, and set up a standing order on payday straight into your ISA.
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Quady
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(Original post by ch0c0h01ic)
Avoid "General Investment Accounts" unless you are a higher rate taxpayer and have already exceeded your ISA and SIPP limit.
What about basic rate taxpayers that hasn't already exceeded their ISA and SIPP limits?
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jxggxr
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(Original post by ch0c0h01ic)
What are you saving for and what is your timescale?

Short term (eg; university, house deposit) - high interest savings would be best or a LISA. You can get up to 2.75% interest with no risk to capital or a 25% bonus with regards to the L-ISA (something that you are exceedingly unlikely to beat with investments).

Medium to long term (eg; early retirement planning, paying for kids tuition fees) - stocks and shares ISA, ideally low cost index trackers (eg; FTSE Global All Cap) in conjunction with a low cost platform (eg; Vanguard, Cavendish)

Long term (eg; retirement) - maximise workplace pension contributions, and consider making additional payments via salary sacrifice (more tax/NI efficient). If you're that savvy consider doing a partial pension transfer periodically to a low cost SIPP platform periodically (eg; Vanguard, Cavendish) to reduce ongoing management charges.

Avoid "General Investment Accounts" unless you are a higher rate taxpayer and have already exceeded your ISA and SIPP limit.

S&S ISAs, SIPPs and salary sacrifice via workplace pensions are far more tax efficient (= greater potential for investment growth/profit long term to lower earners).

Avoid MoneyBox and Plum

Plum or Moneybox is only really applicable to people with no/little financial discipline. However if you fall into this grouping arguably you would save significantly more by following a budget and sticking the difference in a high interest savings account.

Their monthly fees and ongoing charges are relatively expensive compared to low cost providers and their range of funds is very limited.

What concerns me more is that they're not particularly transparent about the composition and diversification of their funds. What are you actually paying for?

My advice would be to set up an inexpensive S&S ISA with Vanguard or Cavendish, and set up a standing order on payday straight into your ISA.
Hi, thank you for your response.

I already have a Help to Buy ISA so I can't have any other type right now. My money goes into a savings account at the moment as well. I have a 9-5 job and am able to save about 90% of my income since I live at home and only need to pay a small amount of rent each month.

I thought where is the best place to put a few hundred pounds each month to maximise the returns? The interest on my savings account isn't much and only nets me a few pounds per month. Surely putting a few hundred into moneybox or plum each month would yield more than a few pounds a month on average over the next few years? Thoughts?
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ch0c0h01ic
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(Original post by Quady)
What about basic rate taxpayers that hasn't already exceeded their ISA and SIPP limits?
...then as said already, they're probably best off maximising pension contributions via salary sacrifice, then possibly taking advantage of a SIPP and/or S&S ISA depending on their goals (eg; early retirement).

(Original post by jxggxr)
Hi, thank you for your response.

I already have a Help to Buy ISA so I can't have any other type right now. My money goes into a savings account at the moment as well. I have a 9-5 job and am able to save about 90% of my income since I live at home and only need to pay a small amount of rent each month.

I thought where is the best place to put a few hundred pounds each month to maximise the returns? The interest on my savings account isn't much and only nets me a few pounds per month. Surely putting a few hundred into moneybox or plum each month would yield more than a few pounds a month on average over the next few years? Thoughts?
You will get a better return via a LISA (ie; 25% government bonus on £4,000).

Plum/Moneybox returns aren't protected and are incredibly volatile. If there was a global recession your investments could drop in value by 10-50% (if not more) - could you afford for your savings to drop in value by 10-50%?
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