In this article I’ll be putting Nutmeg and Moneyfarm head-to-head on a number of metrics to see which comes out on top. This includes portfolio performance, ethical offerings, products and, of course, fees.
As an experienced investor and a Chartered Accountant, I know how important it is to balance costs against returns!
Both are good options if you’re looking for a hands-off way to invest your money, as both Moneyfarm and Nutmeg offer ready-made portfolios. But let’s take a look at a detailed comparison of Moneyfarm vs Nutmeg to see which is the superior platform.
Read on for my full Moneyfarm vs Nutmeg comparison, or use the links below to jump straight to a particular section.
- Moneyfarm vs Nutmeg: At A Glance
- Moneyfarm vs Nutmeg: Fees
- Moneyfarm vs Nutmeg: Products
- Moneyfarm vs Nutmeg: Portfolios
- Moneyfarm vs Nutmeg: Ethical Portfolios
- Moneyfarm vs Nutmeg: Performance
- Moneyfarm vs Nutmeg: Research, Tools & Advice
- Moneyfarm vs Nutmeg: Which Has The Better App?
- Moneyfarm vs Nutmeg: Is My Money Safe?
- Moneyfarm vs Nutmeg: Pros & Cons
- Moneyfarm vs Nutmeg: The Winner
You can also read my in-depth reviews of each platform here:
Moneyfarm vs Nutmeg: At A Glance
Here’s my overview of Moneyfarm vs Nutmeg in case you don’t want to read the whole comparison.
The table below looks at the key features compared against each other.
|Moneyfarm||Nutmeg (Fully Managed)|
|Management Fees||Up to £10,000 – 0.75%|
£10,001-£20,000 – 0.70%
£20,001-£50,000 – 0.65%
£50,001-£100,000 – 0.60%
£101,000-£250,000 – 0.45%
£250,001-£500,000 – 0.40%
Over £500,000 – 0.35%
|Up to £100,000 – 0.75%|
Over £100,000 – 0.35%
|Minimum Investment||£500||£500 for Stocks & Shares ISA, GIA & Pension|
£100 for JISA and LISA
|Products||ISA, JISA, GIA, SIPP (Pension)||ISA, JISA, LISA, GIA, SIPP (Pension) |
& regulated financial advice
|Number Of Portfolios||7||10|
Nutmeg offers more portfolio options and a greater range of products, but Moneyfarm is cheaper if you’re investing between £10,000 and £100,000. If you’re focused on cost and have between £10,000 and £100,000 to invest, then Moneyfarm is cheaper. For between £100k and £500k of investments, Nutmeg is cheaper. Above £500k they’re equal.
Both now offer socially responsible, or ethical, investment options as well as pensions and Junior ISAs (JISA). However, Nutmeg now also offers a Lifetime ISA (LISA) so you will likely prefer Nutmeg if you’re keen on opening a LISA.
Another factor that stands out with Nutmeg is their regulated financial advice service. For a fee of £575 you can speak to a qualified financial advisor who will advise you on your financial plans and lifetime wealth goals. Moneyfarm does not offer personalised regulated advice, so Nutmeg is the clear winner if speaking to a qualified financial advisor is important to you.
What is Moneyfarm?
Moneyfarm is currently one of the largest digital wealth management companies in Europe with over 80,000 users and over £2 billion in assets under management. It launched in Italy in 2011 and then in the UK in 2016.
It is a ‘robo-advisor’ which means it provides ready-made portfolios to invest in based on your risk preferences. It does this by asking you to complete a detailed questionnaire upon signing up and, based on your responses, you’ll be recommended a portfolio to invest your money in. This is a good investment option to consider if you don’t want to actively manage your own money.
Moneyfarm then manages this portfolio for you over time, rebalancing it when necessary. I’ve personally been using Moneyfarm since 2017 to invest my own money.
I was put into the ‘Pioneer’ category when I signed up, which is risk level 6 out of 7. Since late 2017 and up until February 2022 it has returned just under 30% on a money-weighted basis. On a time-weighted basis, it has returned just over 40%. To understand more about what this means, you can read my full Moneyfarm review.
What is Nutmeg?
Nutmeg is a robo-advisor similar to Moneyfarm. It claims to be the largest digital wealth manager in the UK, with over 150,000 clients. Their stated aim is to provide a transparent and jargon-free way of investing.
Founded in 2011 by Nick Hungerford, Nutmeg was acquired by J.P Morgan Chase in 2021 and currently boasts £4 billion in assets under management (AUM).
At the heart of Nutmeg’s investment offering are their robo-advisory investment options which work in much the same way as Moneyfarm’s. But they also offer financial advice unlike Moneyfarm. Nutmeg would be a good option for you if you think you would benefit from speaking to a qualified financial advisor as well as using their robo-advisor platform.
Moneyfarm vs Nutmeg: Fees
Let’s look at the all-important costs for Moneyfarm vs Nutmeg. If you’re not careful when investing in general, you can end up paying much higher fees and charges than you need to.
Nutmeg has a simple fee structure – it charges 0.75% on investments worth up to £100,000 and 0.35% on investments above £100,000. It also offers a fixed allocation portfolio with lower fees. The fees for this are 0.45% for under £100,000 and 0.25% for over £100,000. Nutmeg’s fixed allocation portfolio is not actively managed, which is why it has lower fees. Each of the 5 portfolios in it are reviewed once annually, rather than being actively managed and rebalanced more frequently as with its other investment options.
Moneyfarm has a tiered fee structure which means that for under £100,000 of investments, it’s cheaper than Nutmeg (and equal to it for under £10k):
- Up to £10,000: 0.75%
- £10,001 – £20,000: 0.70%
- £20,001 – £50,000: 0.65%
- £50,001 – £100,000: 0.60%
- £101,000 – £250,000: 0.45%
- £250,001 – £500,000: 0.40%
- Over £500,000: 0.35%
Both Moneyfarm and Nutmeg also have underlying fund costs and market spread, similar to what you will see with any fund investing. Fund costs are 0.2% for both, and the spread costs are up to 0.09% with Moneyfarm and 0.06% with Nutmeg.
If you have under £100,000 to invest, Moneyfarm is the winner on cost, and equal to Nutmeg if you have under £10k. From £100,000 up to £500,000 to invest, Nutmeg is cheaper. Over £500k they’re equal in cost.
Moneyfarm vs Nutmeg: Products
Moneyfarm and Nutmeg both offer stocks and shares ISAs, General Investment Accounts (GIAs), Self-Invested Personal Pensions (SIPPs) and Junior ISAs (JISAs). Nutmeg, however, has a wider range of products as it also offers a Lifetime ISA (LISA) and regulated financial advice.
If you’re particularly keen on opening a LISA then Nutmeg is the option for you, although Moneyfarm is said to be working on offering a LISA.
Nutmeg also offers personalised financial advice through its qualified financial advisors. Again, Nutmeg is the winner if you think you may benefit from speaking to a professional for personalised financial advice. But remember, it’s always worth shopping around when seeking a financial advisor.
Moneyfarm vs Nutmeg: Portfolios
Moneyfarm has 7 portfolios to choose from, each with a different risk level. Nutmeg offers a greater range of 10 portfolios to choose from in its fully managed portfolios, also with differing risk levels.
Nutmeg goes further though, as it also offers two more bundles of portfolios. These are its Fixed Allocation portfolios which offer lower cost investing, and its Smart Alpha portfolios which were created with JP Morgan Asset Management.
This Moneyfarm vs Nutmeg review focuses on Nutmeg’s Fully Managed portfolios, as these are closest in offering to Moneyfarm’s. Overall though, Nutmeg offers a greater choice of portfolios for you to choose from.
Moneyfarm vs Nutmeg: Ethical Portfolios
Environmental, Social and Governance (ESG) investing or Socially Responsible Investing (SRI) is a growing area in the investing space, particularly with younger people. It’s no surprise then that both Moneyfarm and Nutmeg offer a range of SRI options.
These funds are created using Exchange Traded Funds (ETFs) in the same way as Moneyfarm and Nutmeg’s standard portfolios, except that the funds must adhere to their socially responsible investment criteria.
Whilst Moneyfarm’s and Nutmeg’s fees are the same for their SRI options, the underlying fund costs are slightly higher. For Moneyfarm these are almost negligible at 0.21% in their SRI portfolios vs 0.20% in their standard portfolios. Nutmeg’s are noticeably higher at 0.32% in its SRI portfolios vs 0.20% in its Fully Managed portfolios.
If you’re interested in the cheapest way of socially responsible investing, then Moneyfarm may be the better option for you.
Moneyfarm vs Nutmeg: Performance
Given that Moneyfarm has 7 portfolios and Nutmeg has 10, a direct comparison of performance is a little difficult. Furthermore, Nutmeg has 9 years of experience and therefore past performance data vs Moneyfarm’s 7 years.
So let’s look at how the lowest risk, medium risk and highest risk portfolios compared against each other for 2021:
|2021 Performance||Moneyfarm Return||Nutmeg Fully Managed Return|
|Moneyfarm Portfolio 1 / Nutmeg Portfolio 1||-1.7%||+0.1%|
|Moneyfarm Portfolio 4 / Nutmeg Portfolio 5||+8.5%||+7.5%|
|Moneyfarm Portfolio 7 / Nutmeg Portfolio 10||+16.5%||+19.6%|
Although this is not a scientific analysis, it appears that Nutmeg slightly outperformed Moneyfarm at the higher and lower risk levels across the two comparison periods. Moneyfarm performed better in the medium-level of risk portfolios.
Let’s also look at the past 5 year’s performance (at the time of writing) for Moneyfarm vs Nutmeg:
|Feb-2017 to Feb-2022 Performance||Moneyfarm Return||Nutmeg Fully Managed Return|
|Moneyfarm Portfolio 1 / Nutmeg Portfolio 1||-1.1%||-0.4%|
|Moneyfarm Portfolio 4 / Nutmeg Portfolio 5||+21.1%||+18.8%|
|Moneyfarm Portfolio 7 / Nutmeg Portfolio 10||+47.2%||+40.9%|
Over a longer period of time, Nutmeg appears to have outperformed Moneyfarm at the lower risk level. Moneyfarm, however, has outperformed at the mid- and higher-level of risk. As usual though, past performance is not a guarantee of future performance.
Which portfolio you fall into with either Moneyfarm or Nutmeg is down to your own personal circumstances and risk appetite. I am invested in Moneyfarm’s portfolio 6, for example. If you have a higher level of risk appetite then you may lean towards Moneyfarm. At the lower risk end, Nutmeg may be preferable given its track record.
Moneyfarm vs Nutmeg: Research, Tools and Advice
As both Moneyfarm and Nutmeg are robo-advisors, naturally they don’t have the level of research options and tools that more traditional investment platforms have. That being said, Nutmeg offers a good range of calculators on their websites, for example for pensions, self-employment and compound returns. Moneyfarm also offers a pension calculator.
None of these are particularly unique and can easily be found elsewhere online. However, both robo-advisors have a good range of educational guides and blog posts on their websites and in their apps. These are useful for the casual or passive investor to keep up to date with the latest market news.
Nutmeg also offers personalised regulated financial advice for £575. This is something Moneyfarm does not offer. If you think you would benefit from personal financial advice, for example if you want to understand your retirement options, then you can access this through Nutmeg.
Moneyfarm vs Nutmeg: Which Has The Better App?
In my opinion, the Moneyfarm app is superior to Nutmeg’s. That being said, I have used the Moneyfarm app for longer than Nutmeg’s, so there is an element of feeling more comfortable using it.
But I prefer the Moneyfarm apps user interface and how easy it is to navigate around. The in-app chat support feature has always worked well, whereas I did have a small issue connecting to Nutmeg’s at one point.
Moneyfarm vs Nutmeg: Is My Money Safe?
Both Moneyfarm and Nutmeg are regulated by the Financial Conduct Authority (FCA) and have Financial Services Compensation Scheme (FSCS) protection.
This means that if either company were to go bust, your money would be protected up to the value of £85,000 by the regulator.
Additionally, both Moneyfarm and Nutmeg keep customer’s money separate from their own by using trustee bank accounts. These separate bank accounts are also covered by the FSCS.
Moneyfarm vs Nutmeg: Pros & Cons
To summarise, I’ve outlined below what I believe are the main pros and cons of each robo-advisor.
Moneyfarm Pros & Cons
- Good performance in its medium and high risk portfolios when compared to Nutmeg, which suggests it manages volatility well
- Intuitive and easy-to-use app
- Lots of resources and regular market updates through its website and in the app
- Lower cost investing up to £100,000 vs Nutmeg
- On the flip side, it doesn’t offer a Lifetime ISA or personal financial advice
- It also has fewer portfolio options than Nutmeg
Nutmeg Pros & Cons
- Wide range of portfolios to choose from, including Social Responsible, Smart Alpha and Fixed Allocation portfolios on top of its core Fully Managed portfolios
- It has a wider range of products than Moneyfarm too, such as regulated personal financial advice (costing £575) and a Lifetime ISA
- With its Lifetime ISA, you can start investing with as little as £100
- On the flip side, it has higher fees than Moneyfarm if you’re investing between £10,000 and £100,000
- It also slightly underperformed Moneyfarm historically on its medium and higher risk fully managed portfolios
Moneyfarm vs Nutmeg: The Winner
If you’re mainly focused on the lowest cost way to invest, then Moneyfarm is the cheaper option up to £100,000. Moneyfarm has also slightly outperformed Nutmeg at the medium and higher risk levels, although past performance is not a reliable indicator of future performance.
However, Nutmeg offers a wider range of products. If you are keen to open a LISA, for example, then you can do so through Nutmeg but not through Moneyfarm. It also has a greater range of portfolios to choose from, including its Smart Alpha options which have shown higher historical returns.
For me personally, Moneyfarm is the winner because it has delivered good returns and has lower costs which are the two most important factors I look at. But the decision may also come down to the range of products you’re interested in and the variety of portfolios you want access to.