Plum app review

The app that uses AI to help you set aside money and spend wisely.

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Plum

Finder rating ★★★★★

App
Fees
Customer service
Travelling
Range of features
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In a nutshell

  • Great for “set and forget” saving – it’s easy and automatic
  • It’s free
  • Access to money isn’t instantaneous, it can take 24 hours
Plum

Get £5 added into your Plum pocket as a new user

  • Plum automatically sets money aside for you
  • Helps you switch and save money on bills
  • Withdraw funds whenever you need
  • Analyse your spending to help you own your budget
In order to qualify for £5 cashback, last click must come through the Finder link before downloading app and connecting account. Customers must stay active for at least 30 days. New users only.
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What is Plum?

Plum is a smart money management app designed to automatically set aside money without you even thinking about it. It was founded in 2016 with the idea of making managing money easy and stress-free, but it’s also effective for those of us who struggle to put that bit extra away.

Plum is an app that uses smart technology to help you grow your money. Plum started out as a Facebook Messenger chatbot and has since launched an app (available on Android and iOS) that helps you manage your money better. In many ways it’s like having your own personal finance assistant – only it’s a robot who does the work for you.

How does Plum work?

  • Bank account access: Plum users give it access to their bank accounts in a read-only view using the latest biometric security measures.
  • Plum adapts to you: Plum’s smart software analyses and understands patterns in your income and spending habits to recognise the most effective way for savings to be made.
  • Auto-deposits: Once Plum calculates a suitable amount to be put aside each week, this amount is automatically transferred through direct debit into your Plum account to be held until you withdraw it.
  • Notifications: The Plum app can send you notifications about the amounts you’ve put aside, daily or weekly balance updates, and bills you could switch to save money.
  • Flexibility and accessibility: You can withdraw or deposit more money, keep a record of your deposited amount and even invest your savings directly through the app.
  • Spending insights: Plum keeps you informed with customisable updates to monitor your account activity.

Investing with Plum

Plum also gives its users the option to invest some, or all, of their deposited money. You can choose between a range of investment funds, kept in a Stocks & Shares ISA or a general investment fund. You should consider carefully which of these portfolios (you can choose multiple) is best for you, depending on your expertise and risk appetite. You can start investing with just £1.

Through the Plum app, users can choose how much to invest in a range of investment funds, or automatically allocate a set percentage of their auto-deposits to go towards those funds. Examples of the investments funds available include “Tech Giants” (which includes shares of tech leaders such as Apple, Facebook and Google), or “Slow & Steady” (a mix of bonds and stocks). In terms of withdrawals, users can withdraw their investments as often as they wish, although it can take up to 5 days for the money to return to a Plum account.

If you do decide to invest, keep in mind that your capital is at risk and that you could get back less than you invested.

Plum’s fees and limits

It’s free to start setting aside money with Plum. The free Plum Basic plan includes the app download and registration, as well as unlimited deposits and withdrawals, and the automatic deposit feature and bill analysis.

But there are fees for investing your money with Plum:

  • Investment fee. This is £1 per month after your first month (it’s the fee for using Plum Plus, the minimum plan you’ll need to subscribe to if you’d like to use Plum’s investment features).
  • Fund management and provider fee. The fund management fee is between 0.08% and 0.90% a year, depending on which fund you choose. Additionally, there is a 0.15% annual provider fee. Both fees average to an annual fee of 0.53%. So if you invest £1,000, Plum will cost you an average of £17.30 a year.

As well as Plum Basic (free) and Plum Plus (£1 a month), there’s a third tier called Plum Pro, which costs £2.99 per month after a 30-day free trial. As well as the investment features you get with Plum Plus, you can unlock additional functionalities, such as cashback at certain retailers, a monthly spending “diagnostics” report and the “rainy day saver”. We go into more detail about Plum Pro below.

What is Plum Pro?

This is the premium Plum account tier, which costs £2.99 per month after a 30-day free trial.

With Plum Pro, you’ll get all the functionality available with Plum Basic and Plum Plus, as well as the following features:

  • Rainy day savings rule – literally an option you can choose to put more money aside on the days when it’s forecast to rain
  • 52-week saving challenge – this weekly, year-long savings option would see you put aside £1 more than the previous week
  • Pay days – this setting can be configured to deposit an additional lump sum into your Plum account when your salary first hits your bank
  • Diagnostics – a monthly report that shows your spending grouped by categories
  • True balance – calculates how much of your available balance is safe to spend once any regular bill payments have been accounted for
  • Cashback – this rewards you with up to 11% back when you use the app to shop with one of Plum’s partner brands
  • Splitter tool – to automatically apportion your deposits between different Pockets
  • Interest Pockets (see our section below)

Plum’s new Interest Pockets

In September 2020, Plum unveiled a new Interest Pockets feature, which enables its customers to earn interest on the money that they set aside in the app for the first time. When users create a new Pocket (which is a savings pot for a specific goal), they are now given the option to choose between a regular Pocket and one that pays interest.

Subscribers of the Plum Plus and Plum Pro plans can open an easy access Interest Pocket that currently pays interest of 0.55% AER. Plum Plus subscribers can open a single Interest Pocket, while those paying for Plum Pro are able to create multiple Interest Pockets.

In November 2020, easy access Interest Pockets were also extended to Plum Basic users, although the interest rate available to them is currently 0.35% AER.

Money set aside in Plum’s new Interest Pockets will be held on trust with the Investec banking group, which means these funds will be protected by the Financial Services Compensation Scheme.

Is Plum safe?

Apart from money deposited in Interest Pockets, funds held in a general Plum account are not specifically covered by the Financial Services Compensation Scheme (which protects deposits of up to £85,000), as the company is not a licensed bank. But Plum is authorised and regulated by the FCA as an e-wallet money agent of PayrNet (a subsidiary of Railsbank), which allows it to provide users with an e-wallet. Customer funds are held in a pooled account at a UK bank chosen by PayrNet and are protected by safeguarding rules.

Plum also considers its users’ safety and security a top priority – and here are some of the ways Plum works to keep you safe:

  • Plum never stores, or accesses, your bank login details.
  • Plum receives read-only access to your transaction data, so has very limited information.
  • Plum only receives money through a direct debit, which you can cancel at any time.
  • Plum uses symmetric cryptography (AES) to store any sensitive data.
  • Plum uses state-of-the-art password algorithms.
  • Plum uses 256-bit TLS encryption to communicate between the browser and its servers.
  • Plum is a registered data controller and always acts in compliance with the Data Protection Act.
  • Plum runs its servers on Amazon’s cloud, which is trusted by some of the biggest financial institutions in the world.

What does the Plum app look like?

Plum_app

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Pros and cons of Plum

Pros

  • Set aside your money easily and automatically.
  • Free to register and use.
  • Contact Plum easily through its Android and iOS app.
  • Withdraw money 24/7 and receive it within 24 hours (and often, within 15 minutes).
  • Money in your Plum account is held by PayrNet, an EU-licensed e-money provider, which means the funds you have with Plum are safeguarded.
  • Plum’s algorithm prevents auto-deposits taking you into your overdraft (unless you manually deposit money when you’re in your overdraft).
  • Chance to grow your money by investing.
  • Option to open an interest-paying Interest Pocket.

Cons

  • If you choose to invest with Plum, you need to remember that as always when investing, your capital is at risk.
  • Customer funds are not protected by the Financial Services Compensation Scheme (apart from the money in Interest Pockets, which is held on trust at the Investec banking group).
  • Access to money isn’t instantaneous, it can take 24 hours.
  • Plum team is only contactable during office hours (09:00–17:00 from Monday to Friday and 10:00–16:00 on Saturday and Sunday).

Our verdict

Saving is not an especially fun task, and while we all want to be doing it, doing the actual maths and remembering to transfer the money every week or every month requires a lot of commitment. So why not have it done automatically by Plum?

It’s a very smart concept, although there are a few drawbacks to consider. The main one is that Plum’s general account does not pay any interest. So your money won’t be growing unless you open an Interest Pocket, or you decide to invest your funds, which of course entails a whole different set of risks and issues.

Overall, Plum can be a smart and fun way to put money aside without doing much budgeting, or even having to go into your current account to manually make a transfer. Plum has started to offer interest-paying Interest Pockets, and also has a good range of investing options, some of which are suitable for beginners.

Plum

Manage your money with Plum

  • Plum automatically sets money aside for you
  • Helps you switch and save money on bills
  • Withdraw funds whenever you need
  • Analyse your spending to help you own your budget
Promoted
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Capital is at risk.

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