Moneybox Review: Is it a Safe Investment app?

If you're looking for a way to start saving money, Moneybox could be the app for you. This app makes it easy to save and/or invest your money and watch it grow.

But is Moneybox the best savings app out there? Keep reading for an in-depth Moneybox review. We'll discuss how it works, the different account options available, and whether or not the Moneybox app is the right choice for you.

Moneybox works by rounding up your purchases to the nearest pound and then investing or saving that money for you. So, if you spend £12.50 on groceries, for example, the app will automatically invest 50p of that money into your chosen account (either a savings or investment account).

You also have the option to supercharge your savings by opting to deposit a regular weekly amount, a monthly payday amount, and by making one-off deposits whenever you like.

The moneybox app links to your existing bank account, so there is no need to change banks. Simply download the app, and away you go.

There are different account types available:

With investment accounts, please be aware that capital is at risk, meaning investments deposited could go up as well as down. Types of investment accounts available are: 

The features of Moneybox differ depending on the account you have. But, generally speaking, the app offers a way to save money and/or easily invest money.

You can choose to save money for your future or invest money and let it grow over time. And, if you're not sure where to start when it comes to investing or saving money, Moneybox has a lot of helpful tools that make money management easier.

Moneybox does offer an easy way to save money, especially if you have hard time-saving money on your own. Using the app to save money for you can help make saving money easier and less frustrating as you will save money every time you spend money. However, after using the app, I didn't personally feel it was the most advanced saving app compared to other budgeting apps available on the market.

For instance, Moneybox does not offer ai saving technology like competitors Chip and Plum do, meaning round-ups are the only automatic saving you have access to. Moneybox also doesn't offer a budgeting tool or money management tools as Plum and Chip do.

Related Article: Best Budgeting Apps UK

From opening the app, I immediately felt like Moneybox was geared towards encouraging investment rather than general savings, which is the last option on the setup screen.

With that said, Moneybox is still an app well worth trying if you need help saving money, especially if you're looking for ways to save money while investing it at the same time.

I found the moneybox quite easy to use and set up. Once I had signed up, moneybox gave me different options of accounts to choose from depending on whether I wanted to invest or save.

Overall the app feels more geared towards long-term goals such as saving for a house, moving house or retirement. This is different to previous money-saving apps I have tested, which are very much about short term saving techniques to save for a car to holiday etc.

Within the app, you have access to some simple to use yet insightful tools, including:

House Deposit Calculator

Firstly the House deposit calculator allows you to input money and time period. Moneybox then gives you an estimation of how much money you could have saved by the end of your chosen time period. It gives you advice on what type of accounts would be best to maximise your savings, for instance, combining a LISA and a higher interest savings account.

Mortgage Calculator

Moneybox has a mortgage calculator, which is really helpful if you want to know how much money you need for a deposit. Or remortgaging your home.

Pension Calculator

Thirdly a pension calculator which aims to get you thinking about your future. I liked this calculator because I was able to put my salary and current workplace pension contribution and estimate how much money I would have when I retire. moneybox also shows you the difference between contributing a small amount now and waiting till later in life to contribute more money into your pension

Learning Section

There is also a learning section that I thought was a good idea, especially for those new to investing money. Moneybox has a library of articles explaining investing and money-saving in simple jargon-free language. Moneybox also uses a coffee analogy to explain how the stock market works, which I don't think all consumers would understand. Still, it's good that they are trying to educate people to feel comfortable when using their app.

Drawbacks to the app

Although most will find the app easy to use, I personally think moneybox is behind on 'easy ways to save' vs other money management apps I have tested. Other Apps like Chip and Plum have already added personalisation for users to encourage them to be more aggressive with their savings. These apps use ai technology to work how much you can afford to save.

Whereas with Moneybox, apart from round up savings, savings emphasis seems to be on the user manually changing their saving goals.

Moneybox could improve on the following:

• ai technology that helps people save more money as they go about their day to day lives.
• Personalisation for users to tailor how much money they want to save each month/week.
• More money management tools such as budgeting and goal setting within the moneybox app.

As I've mentioned, Moneybox seems to be more geared towards long term life goals, and as such, their account options seem to match this offering. Moneybox categorises its accounts into four different buckets:

• Investing
• Retirement
• First Home
• Saving

Moneybox offers two main types of investment accounts stocks and shares, ISA and a General Investment account. With both accounts, you are subject to additional fees, which are £1 a month (free for three months) plus fund provider costs listed when you sign up (varies from 0.12% to 0.58%).

As investing is a long term savings plan, you should only consider these options if you are confident you will not need to access your money in the next five years.

Stocks and Shares ISA

The moneybox Stocks and Shares ISA is a tax-efficient way to save money. You can invest up to £20,000 in the tax year, and all dividends and capital gains are yours to keep. As long as you don't already have stocks and Share ISA, you can open one with MoneyBox for just £1. Making it an accessible way to start investing.

Moneybox has made investing simple for beginners by offering three simple starting options cautious, balanced and adventurous, giving you some projected risk level. It is worth saying again that investing in past performance is not a reliable indicator of the future.

Note: Your national insurance number is needed to open the Stocks and Shares ISA.

General Investment Account

The moneybox General Investment Account is similar to Stocks and Shares ISA's, except it's not tax-free, meaning you are subject to capital gains tax. So if you have already used your annual stocks & shares ISA allowance, this could be a good option for you.

The same risks apply as with stocks and shares ISA, and you should consider taking professional financial advice before opening either.

Tracker funds are also available. 

Socially Responsible Investing Options

Moneybox offers a variety of socially responsible investing options, which lets you get exposure to companies that have been scored based on their commitment to environmental, social and governance (ESG) practices. These factors can include climate change, employee working conditions, human rights, and more.

Cash Lifetime ISA

Also available for those who want to save for their first home or want to top up their retirement savings is a cash Lifetime ISA.

Moneybox Pension

Within the app, you do have an option to set up a pension which could be useful to anyone who has yet to start a pension and wants to get ahead. You are able to combine your existing pensions and manage them all within one place. I don't have experience using this feature and personally, I think it's best to get financial advice before transferring money between pensions.

Moneybox offers five different savings accounts that reward you with different interest rates depending on how long you leave money in the account. Once you have linked your bank accounts, you can choose a savings account.

Simple Saver

A moneybox Simple Saver account is a savings account that earns 0.47% AER variable interest.

Moneybox doesn't charge any fees for this account and the money from your round-ups can be deposited directly into this account to earn interest.

You can deposit up to £85,000 into the account, and withdrawals are limited to one per calendar month. The interest is calculated daily and paid into your account each month. Moneybox is partnered with Shawbrook Bank, which is a bank and therefore your savings are covered under the financial compensation scheme.

32-day Notice Account

Interest rate 0.71% AER

Notice to withdraw money 32 days

Bank used: Investec

The Moneybox 32-day notice account is a savings account where you have to give 32 days notice before withdrawing money. This type of account usually has a slightly higher interest rate than a simple saver. It's important to note that your money is protected by the Financial Services Compensation Scheme (FSCS) up to £85,000.

45-day Notice Account

Interest rate 0.55% AER

Notice to withdraw money: 45 days

Bank: Charter Savings Bank

This account option did puzzle us. Unless you have a particular passion for Charter savings bank, there is no incentive to pick this account over the 32-day notice, which is a higher interest rate and less notice to withdraw your money.

95-day Notice Account

Interest rate 0.74% AER

Notice to withdraw money: 95 days

Bank: Investec

Forgiving a longer notice period to withdraw funds, moneybox has a better rate of 0.74%

120-day Notice Account

Interest rate 0.80% AER

Notice to withdraw money: 120 days

Bank: Shawbrook Bank

The highest interest rate featured is 0.80%AER. If you have a long term savings goal, this account could be worth considering. The major drawback is you need to wait 120 days to withdraw money which isn't great. Let's say you were using this account to save for a house and needed the money to exchange, 4 months is a long time so do be careful before picking this option!

Moneybox is as safe as your bank. They use 256 bit SSL encryption, the same security protocol your bank uses. They have to have high safety and security protocols in place due to also being regulated by the FCA.

The Financial Services Compensation Scheme (FSCS) protects your money if something happens to Moneybox. They will pay out up to £85,000 per person, so your money is safe even if something goes wrong with the company.

The app also keeps you safe by requiring you to input a five-digit passcode, and Apple users can activate face ID in terms of app safety. Normal precautions on password sharing should be taken.

Moneybox gets excellent reviews for both its app and customer service. Popular review website Trustpilot scores Moneybox 4.5 stars out of 5 with over 1000 reviews.

Those who have used moneybox are very pleased with the service and features. They feel it's a great way of building savings without realising you're doing so. Many have commented on how the app and service have helped them get a mortgage or remortgage on a home.

In terms of negative feedback, most people were annoyed how long money transfers take to reach and withdraw from the accounts so do bear this in mind.

Can you Lose Money in Moneybox?

Yes, there is a chance of losing money with Moneybox through their investing options.

As with any investing option, moneybox is not risk-free. But moneybox offers a variety of funds to choose from, ranging from low to high-risk investments.

Investments can go down as well as up in value, and you may get back less than you invest: meaning that moneybox, as well as any investing option, risks your money. If you want to go down the investing route, try to invest for at least five years and never invest more than you can afford to lose.

Chip Savings App: Chip is another money management app that offers very competitive savings accounts without requiring notice to take money out. Chip uses round-ups and artificial intelligence to help users save as much money as possible. Like Moneybox accounts they also give users the opportunity to invest and have different account options.

Moneybox is cheaper when it comes to investing only costing £1 a month but Chip is better on the savings front offering a better savings rate of 0.61% through Alica bank and not limiting your withdrawals as the Moneybox account does.

For more information check out: Chip App Review

Is Plum or Moneybox Better?

Plum is one of the most well known financial apps out there and pretty hard to compare fairly with Moneybox. Whilst they both offer investment account options, I can't help feel that Plum is more of an everyday app to help you get a better grip of your finances. Whereas Moneybox is aimed at a completely different market for those who are looking to buy a house or save for retirement. There is nothing stopping you from using both apps and turning round-ups on one app and using chip or plum's ai and excellent money management features for everyday purchases and finances.

For more information check out: Plum App Review

Are Moneybox Fees High?

Because Moneybox acts as an intermediary between you and the investment company, their fees are high compared with going to the investment company directly. If you are using it for purely this feature you should consider shopping around first.