Wealthify was set up by a group of investment experts, software engineers and entrepreneurs which it says has a shared ambition to shake things up, make investing easy and affordable for everyone.
Like Moneyfarm, Wealthify offers either a regular plan or an ISA plan. When signing up, you’re greeted by a set of questions including what your goal is (e.g. retirement, wedding), how much you want to invest up front, what monthly contributions you wish to make, how long you wish to invest for, and what your investment style is (on a scale of 1 to 5, from cautious to adventurous). The more adventurous the investment style, the greater the predicted fund value but, as you can guess, the greater the risk of the fund underperforming.
Your money is invested in ETFs, a passive investment (discussed in more detail in our post “What is a robo-advisor?”) in much the same way as Nutmeg and Moneyfarm. Data is collected every day from across the global financial markets and if there is significant turbulence, Wealthify automatically switches investments to less risky assets to protect them. Investments are made in a range of funds including shares, bonds, property and commodities (such as precious metals, energy and agriculture). This ensures that risk is spread. The precise split of investments into each type of fund changes over time depending on the performance of the markets and also on any changes in the investor’s attitude to risk.
The minimum investment is £250 and the fees are 0.7% for investments from £250 to £15,000, 0.6% for investments from £15,000 to £100,000, and 0.5% for all investments from £100,000 upwards. On top of these is the underlying fund charge, which Wealthify says averages 0.17% per year. Funds are invested the next working day after Wealthify receives them. There are no charges for withdrawing funds.
Uniquely, Wealthify also offers reduced fees if you introduce friends or family into your “circle”. The larger the circle of friends/family, the larger the reduction, starting at 5% discount for 2+ people in the circle, to a whopping 20% discount for circles of 50+ people.
Wealthify at a glance:
- What kind of investments? Stocks and shares ISA, general investment account.
- How many risk profiles? 5.
- Minimum investment? £250.
- Fees? 0.7% (£250 to £15,000), 0.6% (£15,000 to £100,000), 0.5% (£100,000 or more). Plus underlying fund cost (averaging 0.17%). Fee discount if friends/family introduced (from 5% up to 20% discount).