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.
Wealthify review January 2020
We take a look at investing with Wealthify.
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Read on to find out if Wealthify could be right for you.
What is Wealthify?
Wealthify is a digital investment management company, which aims to offer simple and effortless ways to invest your money.
Based in Cardiff, Wealthify launched in 2016 and is backed by Aviva, which acquired a majority stake in 2017.
It operates online through its website and an app, but also has humans available on the phone.
How does Wealthify work?
Wealthify invests your money in diversified portfolios to spread your risk across different industries and countries. Your portfolio will contain mainly low-cost, passive investments, such as Exchange-Traded Funds (ETFs) and mutual funds.
Its team of qualified investment managers are monitoring and adjusting your plan regularly as the stock market fluctuates to ensure the best returns for your money.
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Updated January 18th, 2020
What should I choose – an investment ISA or a general investing account?
Wealthify offers customers the chance to invest in stocks and shares through an investment ISA (individual savings account) or a general investing platform.
If you don’t have any other ISAs elsewhere, then an investment ISA could be a better place to start. Interest earned from your first £20,000 is exempt from tax under the 2018/2019 tax year allowance.
Alternatively, if you already have cash or stocks and shares ISA/s elsewhere, you can choose to transfer these to Wealthify. Simply use the ISA transfer form on their website.
General investing suits bigger investments over £20,000, but you are liable to pay tax on any interest or dividends earned.
In terms of savings, ISAs and general investing are a better long-term investment, as you’re more likely to see better returns over a longer period. If you need to regularly access your savings, it’s worth considering a traditional savings account with a bank or building society instead.
Stocks and shares ISAs explained
How do I apply for a Wealthify account?
To open a Wealthify Investment ISA or general investing account, you must be 18 or over and a resident of the UK.
Unlike other robo advisers, Wealthify require a low minimum investment of just £1, which is great for those who are new to investing and just want to dip their toe in.
You should be able to set up a ISA or general investing account in 10 minutes or so via their website.
After filling in some personal details, you tell Wealthify how much you have to invest, your financial goals and attitude to risk. This information will help Wealthify match you to an investment style – cautious, tentative, confident, ambitious or adventurous.
With both ISAs and general investing, you can choose between an original or ethical theme of investing. Ethical investing aims to avoid harmful activities (e.g. tobacco, gambling, weapons and adult entertainment) and opts for companies who take their environmental and social responsibilities seriously.
- Original: Up to 20 mutual funds and ETFs, featuring stocks, bonds, cash and cash equivalents, property, private equity and commodities.
- Ethical: Up to 25 mutual funds and ETFs, featuring shares, bonds and other thematic investments (e.g. gender equality or green energy funds) from around the world.
Wealthify fees
All Wealthify customers are subject to management fees depending on your level of investing, regardless if you have an ISA or a general investing platform. The more you invest, the lower your fee percentage will be.
- 0.7% annually on the balances up to £15,000.
- 0.6% annually on balances between £15,000 and £50,000.
- 0.5% annually on balances between £50,000 and £100,000.
- 0.4% annually on balances over £100,000.
In addition to this, you’ll also be charged a transaction cost (market spread) and fund fee, which tend to average at 0.12% and 0.21% per year respectively for an original fund.
Meanwhile, ethical fund fees could cost up to an average of 0.54% per year, although the transaction costs tend to be lower at an average of 0.03% annually.
Pros and cons
Pros
- No minimum investment: You can start your portfolio with just £1.
- Easy access to your portfolio online or via the app.
- Flexible payments: You can add to your portfolio with one-off or regular payments.
- No withdrawal charges: It’s free to access your money at any time.
- Customer service: Live chat, phone or online message.
Cons
- Less control over investments: If you want to choose how and where you invest, you’re better off managing your own portfolio.
- No cash or lifetime ISA products.
Is Wealthify safe?
Wealthify are authorised and regulated by the Financial Conduct Authority (FCA), which means you could be entitled to compensation if they are found to be acting improperly.
It is part of the Close Brothers Group, who have been trading for over 130 years, and are backed by leading financial provider and insurer Aviva.
What other options are available?
Wealthify is just one robo adviser in a growing industry of digital wealth management. Similar companies exist such as Moneyfarm and Nutmeg, which offer both ISAs and general investing products.
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