In the market for a robo adviser but not sure which one to pick? Scouring the internet for a great investment app to get started investing in the stock market but confused by the choice? Two fairly similar services are Moneybox vs Moneyfarm. Sometimes it isn’t easy to distinguish the key differences, so we’ll boil it down to the pertinent points with our analysis. Keep on reading to find out which of the two digital investment platforms will help you work towards your financial goal.
- Additional saving features
- ESG options
- Low minimum investment
- No financial advice
- Small range of funds
- Questionnaire on sign-up
- Ethical investment portfolios
- On-hand investment expert
- £500 minimum investment
- Higher fees
- Quick summary
- The head to head: Moneybox vs Moneyfarm
- How we assess the head to head of Moneyfarm vs Moneybox
- Round 1: Investments Available
- Round 2: Ethical investing
- Round 3: Accounts available
- Round 4: Fees
- Round 5: Existing customer reviews
- Round 6: Minimum deposit requirements
- Round 7: Withdrawal restrictions
- Round 8: Platforms available
- Round 9: FSCS protection
- Alternatives to Moneybox and Moneyfarm
- Conclusion: Moneybox vs Moneyfarm
The head to head: Moneybox vs Moneyfarm
How we assess the head to head for Moneyfarm vs Moneybox
In order to allow the best comparability, we’ll compare Moneyfarm and Moneybox on the following dimensions:
- Investments available
- Availability of ethical investing options
- Account availability (ISA etc)
- Existing customer reviews
- Minimum deposit requirements
- Platforms available
- FSCS protection
Before we start, it is worth saying that nothing in this article should be seen as financial advice. With all investing, your capital is at risk. Even though we regularly update our content, please do your own research before investing. If you require financial advice, you can search for a regulated and qualified financial advisor via the Personal Finance Society.
*Any links with an asterisk may be affiliate links. Even though we may receive a payment if you use this link to sign up for the service, it does not influence our editorial content and we remain independent. The views expressed are based on our own experience and independent analysis of the service.
Round 1: Investments Available
Moneybox has a set of three “starter options” which is great for beginner investors. These three options; “Cautious”, “Balanced” and “Adventurous” differ by their asset allocation. i.e the Adventurous option has a higher equity allocation at 80%, with the Cautious option having 15% in shares. Each of these invests in underlying tracker funds such as Fidelity Index World.
As Moneybox is not authorised to give financial advice, there is no advice or questionnaire to recommend which one is best for you. However, they do have some great contextual guides around risk and investing which can help you to feel more confident in your choices.
For the more advanced investor, you’ll be able to tweak the asset allocations within your Moneybox portfolio. Additionally, you’ll be able to select from a range of index funds if you’re aiming to get exposure to more of a certain asset class or industry. Some of the index funds available are:
- Fidelity Index Emerging Markets
- Legal & General Global Technology Index
- Legal & General Global Health and Pharmaceuticals Index
More are available within the Moneybox app, which you’ll be able to find here. If you have a Stocks & Shares ISA, then a range of exchange-traded funds (ETFs) are available within Moneybox, such as the Vanguard S&P 500 UCITS ETF. A full listing is available here.
Alongside its investment platform, Moneybox also has a range of features to help you save money consistently. Such as the ability to divert your money on payday automatically into your savings account or investments with Moneybox. Similarly, there are automatic round-ups (if you spend £5.50, it will automatically round up and invest the £0.50). If you are just starting out or find it difficult to save money, then Moneybox could well be the answer for you.
Moneyfarm is more of a traditional robo advisor. Utilising technology to offer actively managed portfolios to investors who otherwise wouldn’t be able to afford a full financial advisor. They have seven globally diversified investment portfolios. Each portfolio is different based on its asset allocation. These are intended to match different investors’ risk appetites, with each portfolio having a different risk level.
The more risky portfolios will have a higher weighting of stocks, whereas the lower risk portfolios will have a higher weighting of bonds.
Moneyfarm is also regulated by the Financial Conduct Authority to offer investment advice. Very usefully, when signing up with Moneyfarm, you’ll answer a questionnaire that helps them to recommend you a portfolio matched to your risk appetite. Similarly, you will have an investment expert on-hand to help support you.
This is great, especially for first-time investors, as you may not know or yet understand your own risk appetite enough to make this decision without guidance.
As Moneyfarm is a more actively managed service, there is no option for you to tweak the underlying investments or funds. You can only switch between the different risk-based portfolios.
Round 2: Ethical investing
Moneybox has some ethical investing options alongside their initial portfolios. You can opt to replace the global shares fund in your starter options (the “cautious”, “balanced” and “adventurous” funds) for a socially responsible shares fund offered by Old Mutual (Old Mutual MSCI World ESG Index).
There are a few other socially responsible options available for you to include in your portfolio via Moneybox if you wish, such as Royal London Emerging Markets ESG Leaders and 8 ETFs (with a full listing here). These aren’t included in the starting portfolios, but you can add them to your portfolio if you would like.
They do offer an ethical investment version of each of their investment portfolios. These ethical portfolios are constructed using data from MSCI. MSCI is a leading global research firm specialising in Environmental, Social and Governance metrics (ESG) and is used by lots of the largest investment firms globally.
With ethical investing though, it is worth calling out some of the drawbacks of these portfolios. If you’re looking to have visibility of each individual company that you are invested in to ensure your money is being invested in line with your values, then you’re better off using a more stock broker-esque platform like Hargreaves Lansdown or Freetrade. The downside with selecting individual investments though is the difficulty in achieving diversification, the higher transaction fees involved in more actively trading your investments, and the increased time required to regularly rebalance your investments in line with your risk appetite.
Round 3: Accounts available
- General Investment Account
- Stocks and Shares ISA
- Junior ISA
- Lifetime ISA (LISA)
- Personal Pension
- Additionally a range of savings accounts
- General Investment Account
- Stocks and Shares ISA
- Personal Pension
Round 4: Fees
Moneybox’s fee is split into a few components:
- monthly subscription fee: £1
- platform fee: 0.45%
- fund provider costs: 0.12%-0.58%
The monthly subscription fee is free for the first 3 months, but £1 per month thereafter.
The platform fee is the ongoing management cost paying for their platform.
The fund provider costs are the costs charged by the underlying funds and so not controlled by Moneybox.
Focusing just on the platform and subscription fee, you would be looking at a total of £1 per month +0.45%.
Moneyfarm operates a tiered pricing structure based on the amount invested. This is made up of two parts:
- management fee/platform fee (this is the fee you pay for using Moneyfarm’s services)
- underlying investment fees (these are the fees you pay for the funds and investments Moneyfarm invests in)
The underlying fee remains flat at 0.29%.
However, the management fee is tiered:
- From £500 – £10,000: 0.75%
- £10,001 – £50,000: 0.6%
- £50,001 – £100,000: 0.5%
- £100,001+: 0.35%
If you had £10,000 invested in each you would end up paying the following per provider. For the sake of simplicity we’re only comparing the management/platform fee and excluding the cost of the underlying fund charges.
Moneybox: £1 per month + (0.45% x £10,000) = £57 per year (0.57% per year)
Moneyfarm: 0.75% x £10,000 = £75 per year (0.75% per year).
Round 5: Existing customer reviews
Moneybox had an average of 4.5/5 on Trustpilot from just over 1000 reviews at the time of writing. Lots of positive reviews discuss the ease of use of the app and their other savings tools, alongside positive reviews that they have the option of a LISA. Negative reviews discuss the automatic transfers/round ups from their app (although bear in mind you can disable this feature), as well as slow transfers on occasion.
An average of 4.7/5 on Trustpilot from 655 reviews at time of writing. Positive reviews discuss the ease of using the platform and the design, as well as the access to the investment expert on hand. However, some negative reviews discuss slow handling of transfers and withdrawals.
Round 6: Minimum deposit requirements
Moneybox requires only £1 to get started.
Moneyfarm requires a £500 minimum investment.
Round 7: Withdrawal restrictions
There are no restrictions on withdrawing from the investing accounts (other than the standard Pension restrictions i.e you can’t withdraw before retirement age). As the underlying funds need to be sold before the money is returned, it can take up to 1-2 weeks for the money to be returned.
There are no restrictions on the accounts (other than the standard Pension restrictions where you cannot withdraw until you are 55). Withdrawals take up to 7 working days, and there are no fees or penalties.
Round 8: Platforms available
Moneybox can be accessed via their iOS and Android apps.
Moneyfarm can be accessed online via the browser, as well as having both an iOS and Android app to monitor your portfolio on the go.
Round 9: FSCS protection
The Financial Services Compensation Scheme protects eligible deposits up to £85,000 and so provides a level of assurance should anything happen to the company your money is protected (you can find out more about the scheme here).
Does Moneybox have FSCS protection?
Yes, Moneybox is covered by the FSCS scheme. Note for their savings accounts that these are actually protected by the bank that they hold the money with (they don’t hold the money themselves). If you are looking to use one of their savings products, be sure to check this explainer from Moneybox about where the money is held.
Does Moneyfarm have FSCS protection?
Yes, Moneyfarm is covered by FSCS protection up to the first £85,000 are covered by the UK deposit guarantee scheme.
Alternatives to Moneybox and Moneyfarm
Whereas alternatively, you may look to build your own portfolio. The benefit of this is that you can achieve lower fees than you will find with a robo adviser. However, the downside is that you will need to have more knowledge, will spend more time rebalancing your portfolio and may incur higher transaction fees if you are regularly trading your investments. Some good DIY platforms are Freetrade*, Stake*, Vanguard and Hargreaves Lansdown*. We’ve compiled a round up of the best investing apps here.
Conclusion: Moneybox vs Moneyfarm
Whereas Moneyfarm* is more an out and out robo advisor, Moneybox is a better fit for complete beginners. It has tonnes of educational content, helping to bring you up to speed with investing and risk. The fees are cheaper for smaller portfolios, and Moneybox has a range of additional features that will help you to save money (such as their round-up and payday boost features).
However, if you’re looking for an out and out digital wealth manager with the support of an on-hand investment expert, then Moneyfarm* is a great choice.
Have you had experience with both of these platforms? If so, we would love to hear your opinion on the head to head; Moneybox vs Moneyfarm. Drop a comment in the section below to let us know what you thought of each.