Robo Investing - too good to be true?

badger09

vigman wrote: »

Please tell me where I can get 2% risk free? There are no ISAs offering this, even 5 year fixes

TIA

Vigman

There are several current accounts paying up to 5%, and a number of regular savers also paying up to 5%.

JohnRo

fiisch wrote: »

I may be being incredibly naïve here, but 0.6% annual charge on £10k equates to £60 / year... right?!


As I'm well under that mark, it's not something I'll need to worry about for a while - might be worthwhile stopping my monthly payments as I draw near, then blasting through the £10k limit when I have a decent amount saved up... or indeed pulling my investment and finding another advisor, but if they're returning 20%, what's 0.6% between friends?!

They're not returning 20%, they're taking 0.6% (above £10K) of whatever return those selected investments deliver. That return is not dependent on where they're held.

So you or anyone else can hold that same basket of investments for a lot less elsewhere.

You can be sure of one thing, as sure as anyone can be of anything, their headline ~20% returns number that's enticed you in will almost certainly be heading a lot lower over the course of your investment time frame, if that's years.

Linton

20% returns in foreign or larger UK company based investments was easy to achieve in the past year simply because of the BREXIT fall in the value of the £. Such returns arent normal.

fiisch

JohnRo wrote: »

They're not returning 20%, they're taking 0.6% (above £10K) of whatever return those selected investments deliver. That return is not dependent on where they're held.

So you or anyone else can hold that same basket of investments for a lot less elsewhere.

You can be sure of one thing, as sure as anyone can be of anything, their headline ~20% returns number that's enticed you in will almost certainly be heading a lot lower over the course of your investment time frame, if that's years.

I'm not sure I'm following...


So, for argument's sake, if I was to invest £50,000 and my investment returns 5%, Moneyfarm will take 0.6% of the returns of £40,000... i.e.:


5% return on £40,000 (£50,000-£1000) = £2,000


0.6% of £2,000 = £12 annual fee


Surely not? That seems cheap to me!


Take the point re.: probable returns. From what I understand, over a long-term (i.e.: decades), I'd be doing well to achieve regular 6% YOY ROI. But, reviews on Moneyfarm (e.g.: ThisisMoney) do support the 20%, so I can dream, right?!

Linton

fiisch wrote: »

I'm not sure I'm following...


So, for argument's sake, if I was to invest £50,000 and my investment returns 5%, Moneyfarm will take 0.6% of the returns of £40,000... i.e.:


5% return on £40,000 (£50,000-£1000) = £2,000


0.6% of £2,000 = £12 annual fee


Surely not? That seems cheap to me!


......

I am afraid not. It's clear on the website. The 0.6% is on the total invested-£10K, not on the gains. So your £50K investment would cost £40K X 0.6%=£240. See here

adindas

DragonQ wrote: »

Correct. I was within the 500 as I signed up during the evening after it was announced. The following morning the offer was gone.

Indeed, it was sold like like a hot cake for obvious reason.
But I missed the boat because I was not aware of this offer earlier.

vigman

badger09 wrote: »

There are several current accounts paying up to 5%, and a number of regular savers also paying up to 5%.

But only for very small amounts of money surely?

My wife and I each have a Santander 123 account and a joint but these are only paying 1.5% on £20K

Is there anywhere paying a safe 2% on £40K?

TIA

Vigman

adindas

vigman wrote: »

But only for very small amounts of money surely?

My wife and I each have a Santander 123 account and a joint but these are only paying 1.5% on £20K

Is there anywhere paying a safe 2% on £40K?

TIA

Vigman

If you have maxed out all of current accounts paying 2%+ then you will need to supplement it with drip feeding to Regular saver accounts.

The discussion about this is available here.
https://forums.moneysavingexpert.com/discussion/966321

Besides higher interest current accounts, I have more than 20 regular savers paying 2%+, most notably 10x£250 Regular saving Account with virgin money @2.25%pa. I have been draining money to RSA at a rate of about £8000 pm paying at least 2% and I could keep running this iteration continuously while it last.

For more flexibility of managing it, you will also need a temporary container, e.g instant access saving paying about 1% such as Ford Money Flexible Saver or Tesco Internet Saver where you could put a large sum of money. Your money might stay they for a short time while waiting allocation to a higher interest in the RSA.

elephantrosie

wealthify keeps losing money these days