Investment PlatformsReviews

Nutmeg Review (Pros, Cons & Is It Right For You?)

Whether you are an experienced investor, or just looking to break into money management, there is a good chance that you have heard of Nutmeg. In the UK, Nutmeg is one of the most well-known ways to easily invest your money, completely online. 

But is it the best platform out there? With so many options in a new space, it can be tough to know which “robo advisor” is the best to trust with your wealth.

To make your decision easier, we have broken down everything you need to know about investing with Nutmeg. 

Who is Nutmeg?

Back in 2011, Nutmeg became the UK’s first digital investment management company. Today, the platform is the UK’s largest “robo advisor,” with over £1B billion in assets and 50,000 customers. 

Should You Invest with Nutmeg? 

Nutmeg is perfect if you are looking for a platform to invest for the first time. Alternatively, it is great for passive investors who simply want to “set it and forget it.” 

Nutmeg is currently only available for U.K. residents. However, non-residents with a U.K. bank account and a British passport may also open an account, depending on their location. 

How Does Nutmeg Work?

Nutmeg offers two basic investment services: Fully managed and fixed allocation portfolios. 

In both instances, users are able to choose the amount of risk they would like to take, from 1 to 10. 10 being aggressive and a pretty loose goose, 1 being someone who might be better off keeping your powder dry in a savings account… and there is nothing wrong with that.

Fully Managed portfolios

These portfolios are managed by the experienced investment team headed up by Shaun Port . They regularly make strategic tweaks to try and protect against losses and boost returns. They will be continually managing portfolios in response to political, social & economic volatility, or … just when they see fit.

Fixed Allocation Portfolios

Designed to perform without investment managers tweaking and twerking at every opportunity. Warren Buffett has forever been a mega-advocate of passive funds out-performing active fund managers and this is Nutmeg’s nod to this. Fixed allocation keeps you invested in assets matching your risk level, only requiring review once a year to make sure they’re still right for you.

Is Nutmeg Legit? Is Nutmeg Trustworthy?

With a decade of experience to show for it, Nutmeg is one of the most trustworthy digital investment platforms available today. Their website boasts Financial Conduct Authority regulation, Financial Services Compensation Scheme protection, and an “Excellent” rating on Trustpilot. 

To log into your account, there is a two-step verification process before you can create your login credentials. All of your data is protected by TLS encryption. 

What Are The Fees & Charges when Investing with Nutmeg?

For your first £100,000, Nutmeg charges 0.75% for a fully managed portfolio and only 0.45% for a fixed allocation portfolio. Once your account reaches over £100,000, the fees lower to 0.35% and 0.25% respectively.

For both fixed allocation and fully managed portfolios there is also an underlying 0.19% fund cost. 

Most importantly, however, Nutmeg has no exit fees, transaction fees, or trading fees.

As you can see, when your account balance grows, your fees will shrink. That way, you will be able to earn even more from your investments. This makes the company’s simple, lowering fee structure is one of the best things about investing with Nutmeg. 

How Does Nutmeg Make Money?

Clearly, Nutmeg makes it money from percentage fees taken from customer accounts. In comparison to other advisors, nutmeg’s management and fund fees are relatively low. 

What Else Does Nutmeg Do?

In addition to general investment and pension accounts, Nutmeg also offers Lifetime ISA, Junior ISA, and Stocks and Shares ISA options

No matter how you are investing, you can access your Nutmeg account 24/7 on the company’s app, available for both Apple and Android. 

What Are People Saying About Nutmeg?

In general, there are not many public complaints being made about Nutmeg. For example, Business Insider, called Nutmeg “a terrific option for those who are looking toward retirement.”  Likewise, the company has a 3.4 out of 5 stars on Investopedia.. 

More than anything, some people would like to be able to have a more hands on experience when it comes to anything, and Nutmeg is simply not built for that. Instead, it is ideal for simple, passive investing.

What Are The Benefits Of Investing with Nutmeg?

  • Extremely user friendly
  • Fast and easy portfolio setup and management
  • Option for fixed allocation or fully managed accounts
  • Simple fee structures
  • Great customer service
  • Relatively low fees in comparison to similar services

What Are The Disadvantages Of Nutmeg?

  • For an ISA, a £500 minimum investment may be too high for first time investors
  • £100 minimum monthly deposit is required until your balance reaches £5,000 
  • For a pension account, the minimum investment is £5,000
  • Extremely simple research and opportunities when compared to more advanced services

Our Verdict

Ultimately, Nutmeg is a great hands-off way to begin investing your money. 

If you have a decent amount of capital, but not a lot of time on your hands, Nutmeg is perfect for you. The company offers a simple platform, low fees, and great customer service. 

Whereas other advisors may offer more diverse and complex portfolio options, Nutmeg makes it easy to make simple, trustworthy investments. 

Tom
About author

Fully qualified CISI Investment adviser for 5 year. Managed UK private client portfolios.
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