How To Invest Money Online Free

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Nutmeg and Evestor are best investment platforms for beginners, partly because they are the cheapest.

It's not just down to cost though. Investment platforms are sometimes called robo-advisers because they provide automated customer service for people with little or no experience of investing.

In this article we outline:

The top five investment platforms
What an investment platform is and how they differ
How to choose the best platform for you

Graphic showing watering can with money — Investing your cash can make it grow much quicker than leaving it in a bank account. Make sure you check the fees closely when picking an investment platform

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Top five investment platforms for beginners

Nutmeg*

Best for: robo-advice

Nutmeg* was one of the first of the new generation of robo-advisers and is now one of the biggest in this new breed of investment portfolios on mobile apps. You can open a bank account, a pension, stocks and shares ISA or regular general investment portfolio account on its site – and can choose from a range of three different portfolio types.

The cheapest of these are its fixed-allocation portfolios, where the mix of investment assets decided at the outset remains the same.

Alternatively, if you're willing to pay a little more for your personal finances, you can opt for Nutmeg's fully managed portfolios. This is where online brokerages get involved to monitor your portfolio, buy and sell online stocks on your behalf, making adjustments to the investment portfolio mix where necessary, to help you achieve your objectives.

The firm also offers a set of socially responsible portfolios. Total costs for its cheapest options start at 0.71% to 1.14% for its socially responsible portfolios. The site is easy to use, and uses graphs to show you potential returns and losses.

Evestor

Best for: low-cost, simple choices

If you want a site that keeps things simple and provides low-cost investment portfolios from a low entry point, Evestor is worth a look.

It only offers three investment portfolios to choose from – low, medium and high risk – and its total costs of just 0.49% are some of the lowest in the market.

You can put your investments into a stocks and shares ISA, a pension or a general investment trading account. There are no sneaky extra charges to worry about.

You can also start investing from as little as £1, and your money will go into a range of exchange-traded funds (ETFs) and funds that track various stock market and bond indices.

Vanguard

Best for: lowest cost from a big firm

If you're looking for the cheapest way to invest – full stop – then look no further than Vanguard.

It's a large American fund management group, which has made a name for itself as a discount online brokerage offering the best value on both sides of the pond, whether that means investing into a stocks and shares ISA or into a brokerage account.

You can invest in its LifeStrategy portfolios for as little as 0.41% a year.

There's not much support for investors on the Vanguard site – so it's best for those who have a little bit of knowledge. The LifeStrategy portfolios come in five different risk varieties – from cautious to aggressive.

HSBC

Best for: those looking to invest with a bank

If you want to put your money with a high street name, then HSBC is worth considering.

It offers investment portfolios with five different risk levels – from cautious to adventurous – with total annual costs starting from 0.43%.

There's not much help and support in making your decision – but you can start buying and selling investment portfolios with a lump sum of £100, or you can set up a regular monthly payment of £50 from your bank account, and it's the lowest-cost offer from the banks.

Fidelity*

Best for: a full-service platform

If you want to start investing in a ready-made investment portfolio, but hope to graduate to picking your own investments and doing your own stock tradings, Fidelity may be the right solution.

It's one of the largest investment providers in the world, and its UK investment platform offers access to the full range of mainstream investment funds (also known as mutual funds) as well as a trading platform to invest in stocks, shares, bonds and other assets.

If you are just getting started, you can use its "pathfinder" tool on the mobile app to help you choose from one of 10 ready-made growth portfolios or six income-focused portfolios.

The tool lets you narrow down your choices by helping you decide on your risk level, and then gives you options from the lowest-cost to a more fully managed portfolio. It has an easy-to-use graph that helps you project your potential returns. Its cheapest portfolios have a total annual cost of 0.64%.

Barclays Wealth Global Markets Portfolios

Coutts

Coutts Invest

evestor

eVestor portfolio

Fidelity Personal Investing

Fidelity Personal Investing Cost Focus portfolio

Halifax

Halifax portfolio

What are investment platforms?

Investment platforms are online services that allow you to buy and hold shares, bonds and funds in one place.

These services can include making it easy to invest in stocks and shares ISAs or mutual funds.

Many of the platforms let investors choose a ready-made portfolio that matches their risk appetite.

Over the past decade, old-fashioned stockbrokers have started to face competition from a new generation of investment platforms. This is because platform focus on providing low-cost and straightforward access to investing for people who have little or no experience.

Read our Beginner's guide to investing

Some platforms offer automated guidance on which options might be most suitable for you, which is sometimes called robo-advice. This does not actually count as financial advice – it's just support to help you make the best decision for your needs.

However, some of these platforms do also offer access to personal financial advisers in return for an extra fee.

Find out: How much does financial advice cost – and is it worth it?

Traditional investment platforms allow you to choose what you invest in yourself. They are also known as DIY platforms or share trading investment platforms. However, most of these now offer ready-made portfolio options as well.

You also use these platforms to invest for retirement: see our guide to pensions.

Top rated fund & share accounts (for high frequency trading)

Our independent star ratings can help you sort through the best fund and share accounts

Barclays

Investment Account

Capital.com

Trading account

Close Brothers Asset Management

Investment Account

About our independent ratings

We have used our ratings, compiled by independent research firm Fairer Finance, to pinpoint the cheapest trading platforms on the stock market.

We also considered how well they would work for a novice investor to buy or sell stocks.

Our best platforms for beginners all have top five-star ratings, which means their total costs are below the sector average, and they do not impose any nasty exit penalties or additional high fees or charges.

Find out: Customer experience ratings: investment platform winners

(Note that we award gold, silver and bronze ratings to large firms that are transparent and have great customer service and low complaints figures; we don't review smaller firms as we can't get a meaningful sample.)

How to choose an investment platform

If you're looking for an investment platform that does all the heavy lifting for you, you're likely to be best off with the newer generation of firms.

When choosing a platform, you should consider:

Does the platform have a slick mobile app? This makes online trading easy. Find out which platforms have the best investment apps.
How do the costs compare? While no one knows how different investment portfolios are going to perform, you can be certain about the expense. Our ratings give you an idea of how providers shape up here.
Does the management fee for the ready-made portfolio include transaction costs that the fund incurs for trading?
What range of investments does the platform have? Some offer access to both shares and funds while others don't. Some don't offer ethical funds, so check what's on offer before you sign up.
What about customer service? If a platform you're considering doesn't appear in our customer experience ratings, it's worth giving a few of them a try before you buy.
Does the platform offer a tax-free wrapper like a lifetime ISA? Not all platforms will offer these products so it might be a deal-breaker.

Find out more: self-invested stocks & shares ISAs

Top rated self-invested stocks & shares ISAs

Our independent ratings highlight the best ISAs for those who want to pick their own investments

Barclays

Investment ISA

Close Brothers Asset Management

Close Stocks & Shares ISA

InvestEngine

ISA

Trading 212

Trading212 ISA

Vanguard Asset Management

Vanguard ISA

Frequently asked questions

What are the main types of investments?

The main types are:

Shares
Bonds
Actively managed funds
Index tracking funds
Investment trusts
Property
Cash

Find out: How to choose investment funds.

How can I invest sensibly?

Take a long-term view

You shouldn't invest for any less than five years – and it's most sensible if you're looking at a time horizon of at least 10 years.

That way, you can ride out any downturns in the stock markets and boost the growth potential of your money.

Invest in a pension

It makes sense to invest money in a pension because you'll benefit from tax relief (free cash from the government).

Plus, if it's a workplace pension scheme, you get a contribution from your employer too.

To find out more in our pensions guide

Attitude to risk

The other key point is to assess your risk appetite realistically. If you invest in an aggressive portfolio, bear in mind that you could lose money – even over the long run.

It's important to understand what the worst-case scenario could look like – and to be sure you would be comfortable with that outcome in the context of your personal finances.

Think about your goals

For example, if you're putting money aside for a house deposit and plan to buy in more than five years, you might want to open a stocks and shares.

We have more on investing wisely in our Beginner's guide to investing.

How much should I invest?

If you're investing for a pension, a good rule of thumb is to halve your age and pay this much as a percentage of your salary each month. F

or example, if you're starting a pension at 40, you should be looking to put 20% of your salary away each month.

If you're investing for shorter-term goals, then think about how much you're aiming to save, and work back from there. You can add in some assumptions about investment growth, such as 3% or 5% a year, but don't forget to deduct fees. If you end up saving more than you need – it's a nice problem to have.

Before you start an investment portfolio, make sure you have a decent amount of cash in an easy access account – say, three months' worth of salary – that can be used for any emergencies such as your car or boiler breaking down.

James Daley is managing director of Fairer Finance, the independent consumer group that produces our product tables

*All products, brands or properties mentioned in this article are selected by our writers and editors based on first-hand experience or customer feedback, and are of a standard that we believe our readers expect. This article contains links from which we can earn revenue. This revenue helps us to support the content of this website and to continue to invest in our award-winning journalism. For more, see How we make our money and Editorial promise

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