Moneybox ISA at a glance
With plenty of options for UK residents to save and invest tax-efficiently, it can be hard to find the right platform to use. So, we’ve created this Moneybox ISA review to give you an insight into what this particular provider can offer for investments and cash savings.
The Moneybox ISA presents an affordable way to save and invest for yourself, for your child, or to buy a new home.
Looking at the competition, Moneybox’s ISA offering stands out because of:
- Low minimum deposit to get started.
- The ability to use a stocks and shares ISA, Lifetime ISA (LISA), or a Junior ISA (JISA).
- A simple app-based platform that’s easy to understand.
Want to know more about the Moneybox ISA? To ensure you completely understand this account, throughout this Moneybox ISA review, we’ll explain everything you need to know. This will include all the fees involved, the types of ISA accounts available, how it compares against competitors, and the steps you need to take to transfer your ISA.
What is an ISA?
An ISA (individual savings account), is a tax-efficient account for saving or investing. There are a number of types of tax-efficient ISA accounts available to adult UK residents.
The main types of ISA accounts are:
- Cash ISA (£20,000 limit)
- Stocks and shares ISA (£20,000 limit)
- Lifetime ISA (£4,000 limit)
- Innovative Finance ISA (£20,000 limit)
- Junior ISA (£9,000 limit)
Each tax year, you get a £20,000 allowance that can be used for saving and investing with your ISA account. If you like, you can use this whole amount for your stocks and shares ISA, but keep in mind that the allowance can change yearly.
The main benefit of using a stocks and shares ISA is that for most investments held within the tax wrapper, you don’t have to pay dividend or capital gains (CGT) tax on any income or growth. This allows your portfolio to grow and compound over the years without being held back by a tax burden.
Another significant benefit is that when you want to withdraw funds from your ISA, unlike with a pension, any money you take out doesn’t count towards your income for that year – meaning you pay no additional tax on your funds down the line.
Lifetime ISA (LISA)
A Lifetime ISA (LISA) works slightly differently. You can only use £4,000 of your allowance towards this type of account. The main benefit is that you’ll get an automatic boost of 25%, so you can automatically earn a £1,000 bonus each year (plus any interest or investment gains).
However, a LISA can only be used for retirement savings or to buy your first house. Any other reason and the UK government will penalise you by 25%, which would actually leave you worse off than when you began. Any money also has to remain in the account for at least 12 months before you can use it.
Moneybox ISA at a glance
|🗺️ Supported Countries||UK|
|💰Subscription Fees||£1 per month (free for first 3 months)|
|💰Platform Fee||0.45% (annual expense, but charged monthly) for balances up to £100,000. Above £100,000, it reduces to 0.15%|
|💰Cash LISA Fee||None|
|🎮 Demo Account||No|
|📈 Portfolio Rebalancing||Yes|
|💵 Minimum deposit||£1|
|📍Investment Instruments||Ready-made portfolios, ETFs, US stocks, cash|
Types of Moneybox ISA accounts
There are four types of ISA accounts available with Moneybox:
- Stocks and shares ISA account: this is for adults over 18 based in the UK and you can invest up to £20,000 into this type of ISA during the tax year. This is a robo-advisor but you can choose to have some flexibility around the investments and portfolio allocations.
- Stocks and shares LISA account: allows you to invest up to £4,000 each tax year. You get three starting options to choose from (cautious, balanced and adventurous). The fees are the same as the regular S&S ISA, but with the LISA you also get the 25% government bonus.
- Cash LISA account: the cash LISA offers a competitive variable interest rate of 2.75% (at the time of writing) plus a fixed one year bonus interest rate of 0.75%. There are no fees with this account, but you can only save cash, you can’t invest.
- Junior ISA (JISA) account: allows you to invest on behalf of someone under 18. You can invest up to £9,000 each tax year, which doesn’t count towards your annual allowance. The child can only access the account once they turn 18. The only difference to the costs and fees is that the range of fund costs is between 0.13% and 0.25%.
How it works
The sign-up process is relatively straightforward. If you head to the Moneybox homepage and navigate to the ‘ISA’ page you’re looking for, you can then download the app and get started with just £1. During the registration process, it’s best to have:
- Your national insurance (NI) number.
- Current address.
- A debit card or bank details.
It doesn’t cost you anything to open up a Moneybox account. Keep in mind there are platform fees if you opt for one of the investment options.
So, you’re able to open up an investment ISA/LISA or cash LISA account quite easily. Just keep in mind that you can only open and pay into one stocks and shares ISA account and one LISA each tax year.
Moneybox ISA fees
The costs and fees for the Moneybox ISA are very competitive and straightforward. Here’s a table with everything laid out so that you can review the costs and fees yourself:
|Moneybox ISA Fee||Cost|
|Investment monthly platform fee||0.45% (annual expense, but charged monthly)|
|Investment subscription fee||£1 per month (free for first 3 months)|
|Cash LISA fee||£0|
|Fund charges||Ongoing costs ranging from 0.12% – 0.58%|
|US stock commission||0%|
|FX (foreign exchange) fee||0.45%|
Pros and cons of the Moneybox ISA
Here’s a quick summary of the main advantages and disadvantages of the Moneybox ISA accounts:
- Low monthly fees of 0.45% plus £1 (for stocks and shares ISA/LISA).
- Minimum deposit of just £1.
- No fees for cash LISA and a competitive interest rate.
- Intuitive app with lots of great saving features.
- Ready-made portfolios with customisable allocations and ability to buy US stocks.
- Free withdrawals for stocks and shares ISA.
- No cost to buy or sell funds and investments.
- A simple option for a beginner investor wanting a robo-advisor with the option to customise later.
- You’re only able to invest in a limited range of products.
- The Lifetime ISA (LISA) comes with some stricter rules set by the government.
- The monthly fees are competitive but not the cheapest available.
- Everything is app-based.
How it compares with other ISA and robo-advisor providers
Throughout this Moneybox S&S ISA and LISA review, we’ve run you through most of the key benefits and downsides, but let’s take a look at how the Moneybox platform and its fees stack up against alternative ISA providers:
|Fees||Moneybox||Vanguard||Hargreaves Lansdown||Interactive Brokers||iWeb||Barclays||InvestEngine (Managed)||Interactive Investor||Nutmeg||Natwest|
|Minimum investment||£1||£500 or £100/month||£100 or £25/month||£1||£1||£50||£100||£1 (or no tradings fees with £25/month min)||£500||£50|
|Platform fees||£1/month (plus 0.45%/month)||0.15%/year (plus 0.3% for managed ISA)||0.45%/year||£3/month (or free if your trade fees are more)||£100 (one-off fee)||£4/month min (or 0.2% funds + 0.1% other investments) – capped at £125/month||0.25%||£4.99/month||0.75% up to £100k then 0.35% after (for the fixed allocation portfolio it’s 0.45% up to £100k and 0.25% beyond)||0.15%|
|Share dealing fees||£0 (just ongoing fund costs of 0.12% – 0.58% depending on choice and 0% for US stocks)||£0 (only funds available, no individual stocks and shares)||£0 for funds/£11.95 for stocks and shares (reducing to £8.95 and £5.95 with more trades)||£3 UK shares/€3 European shares/from $0.005 US shares||£5||£3 funds/£6 other investments + £1 transaction charge||£0||£3.99 (you get 1 free trade a month, and some international shares cost £9.99)||0.21% – 0.3% average fund cost (plus 0.07%averaged spread)||0.07% maximum (plus maximum ongoing charge of 0.4%)|
|Foreign exchange fees (FX)||0.45%||None||1% (reducing to 0.75%/0.5%/0.25% for large trades)||0.03%||1.5%||1% (reducing to 0.75%/0.5%/0.25%/0.1% for large trades)||None||1.5% (reducing to 1.25%/1%/0.5%/0.25% for large trades)||None||None|
Transfer an ISA to Moneybox
It is possible to transfer your existing ISA over to Moneybox. You’ll first need to set up an account before you can transfer your ISA. So, once you’ve set up a stocks and shares ISA or a Lifetime ISA on the Moneybox app, you just need to follow these steps:
- Head to your ‘settings’.
- Select ‘Transfer’ and then ‘Transfer in’.
- Everything is done digitally, so you can return any forms by in-app chat or email.
- Transfers should be completed within 3 weeks, but it can take up to 30 calendar days.
Unfortunately, Moneybox can’t accept ISA or LISA transfers from Ulster Bank, One Family, or National Counties.
You can carry out an ‘in-specie’ transfer of investments held elsewhere. These investments would have to match your choices on Moneybox and it can take up to 6 weeks for a transfer to complete. Along with a cash transfer, you can also choose a mixed transfer, moving some funds as cash and some as an in-specie transfer.
Always make sure that you use the official Moneybox ISA transfer service. Don’t withdraw everything from your current provider and move it yourself because you could lose the tax protection you’ve built up over time.
Is your money safe with the Moneybox ISA?
Yes! Moneybox is regulated by the FCA (Financial Conduct Authority), and is covered by the Financial Services Compensation Scheme (FSCS), which protects up to £85,000 of your deposits.
How to pick the right ISA
Finding the right ISA for you depends on what you’re looking for and how regularly you save and invest. Here are some things to look out for and questions to ask yourself when you’re trying to find the best ISA:
- Does the platform offer commission-free trading in the UK, and how cheap are the platform and share dealing fees?
- Can you access multiple accounts, such as a LISA or JISA?
- Is there a discount for frequent investors or savers?
- What is the investment choice like?
- How easy is it to use the platform, is there a mobile app?
- Do you have to pick all the investments, or are there ready-made portfolios?
- Is there a cheap FX fee if you plan on buying international shares?
- How reputable is the provider?
- Does the platform offer good customer service?
- Are there any incentives like free stocks or cashback for joining?
The truth is, there’s no single ‘best’ ISA provider. It’s all about finding the one that fits your needs. Many platforms structure costs and fees differently, especially if you opt for a managed portfolio. So some will work out cheaper for you depending on what you invest in and how frequently.
As mentioned, you can open and pay into one type of each ISA account each tax year. So, if you try one out for a while and don’t like it or find it expensive for your needs, you can always transfer to another platform down the line.
Is Moneybox high risk?
You can choose riskier investments if you want for a potentially higher reward, but you should have that option with most providers. In terms of regulation, Moneybox is regulated and protected in the same way as most other UK ISA platforms and providers.
Which bank is behind Moneybox?
It depends on the ISA account you hold. Sometimes with a cash LISA, funds are split across multiple banks, but no more than 50% of your cash funds will be held with a single bank at any given moment. But Moneybox has relationships with a number of UK banks.
Can you make money on Moneybox?
Definitely. If you opt for a cash LISA, you’ll get a variable rate of interest. If you choose an investment ISA, how much money you make will depend on how successful your investments are.