There are lots of articles out there about how to save for travel, but not many of them focus on where to actually store your money while you’re saving. For those planning a trip in a few years time, investing your savings while you wait could maximise their return. Money sitting in a bank account is all very well, but wouldn’t you rather store your money somewhere it has the potential to grow all by itself?
That’s where Nutmeg come in. Nutmeg is a simple online investment management service which can help people make the most of their savings in a way traditional ISAs don’t necessarily.
What is Nutmeg?
Nutmeg was launched in 2011 by Nick Hungerford, because he “was frustrated by the exclusivity and lack of transparency in the investment world” and wanted to create a company that made investing easy for the consumer. What he created was a brand new way to invest; an easy to use online money management platform that gives complete transparency – not only in terms of where your money is and how it’s doing, but also in terms of how much you’re being charged – as well as complete peace of mind.
How Does it all Work?
With Nutmeg, you don’t need to be an expert to have an investment portfolio. You simply complete a simple online survey, which takes about ten minutes, then they do everything for you – investing your money to best suit your needs and goals.
I’ve tested out the initial setup process and it’s incredibly easy to use. You fill out how much you want to invest and how long for, what your savings goal is, how much you’ll be paying in every month, and select what risk-level you want to take on a scale of one (avoiding loss is the priority) to ten (I’ll risk large losses for higher gains). It couldn’t be easier!
You don’t need to be a millionaire, either. You can start with as little as £1,000 per fund (plus minimum monthly contributions of £50 for portfolios below £5,000), so this really is investment for ordinary people.
Once you’re all set-up, you can basically leave Nutmeg to get on with everything for you. They’ll build you a fully-managed, professional investment portfolio, tailored to you, taking the hassle out of investing by choosing the stocks and shares for you – based on your preferences and risk tolerance. As things progress, they’ll monitor and adjust your investments to help keep them on track.
Nutmeg spread out your investment across various asset classes, geographies and industry sectors, a process known as diversification, so that you don’t have all your eggs in one basket. Doing this spreads the risk on your investments, and improves your chances of higher returns.
How Much Does it Cost?
Nutmeg charge an annual management fee of between 1% and goes as low as 0.3%, including VAT, which is calculated according to the total value of your portfolio. The more you invest, the lower the fee, but even at the maximum of 1% that’s still lower than the cost of a Financial Advisor, and it’s around the same cost as doing it all yourself – with none of the hassle.
Why it’s Great for Travellers
You’re not locked in: Investing is a long-term proposition, but with Nutmeg, you can withdraw whenever you like and there’s no minimum investment period. There’s also no withdrawal fee – unless you need the money faster than normal, in which case an express withdrawal costs just £10.
It’s easy to use: If you’re what I like to call a ‘normal person’ and know nothing to slightly-more-than-nothing about investment, stocks and shares, finance, etc,nyou don’t want to be trying to figure it all out for yourself – but that should keep you from the potential benefits of investing your money. Nutmeg is incredibly easy to use, in fact it takes just ten minutes to set everything up, and your portfolio is laid out in the clearest terms possible – with no complicated jargon.
Great support: Nutmeg place a lot of emphasis on the customer experience, and have a fantastic support team available to contact by phone, email or online chat.
Strong track record: Nutmeg’s past performance has been good so far, and with an expert investment team making smart decisions on your behalf, you’re potential to gain looks pretty good.
What do you think, would you consider saving with an ISA from Nutmeg? Easy-to-use, customer friendly, open and transparent about their processes, and a potential to earn much more than a standard cash ISA – it seems like a great option for saving towards travel, the future, or any other big goals.