Moneybox Review: Should You Invest?

Moneybox SIPP simplifies retirement savings through its user-friendly app and automated round-ups, making it effortless for users to start and grow their pension pot. Its standout feature is the integration of everyday transactions into saving for the future.
  • Last Updated: 22 Mar 2024
  • Fact Checked
  • Our team recently fact checked this article for accuracy. However, things do change, so please do your own research.

Contributors:

Francis Hui
Manage Your Retirement Savings On-the-Go With the App-Based Moneybox SIPP: Unify Lost Pension Pots, Reap Tax Benefits, & Explore Various Investment Options. Read This to Find Out If This Option Would Suit Your Needs.
Every Investor Promise
Every Investor Promise
At Every Investor, our aim is to assist you in making informed financial choices. We are committed to maintaining rigorous editorial standards, yet it is important to note that our content may include references to our partner’s products. For full transparency, here is an overview of how we earn money.
Key Takeaways
  • A Moneybox SIPP is a type of self-invested personal pension.
  • They allow individuals to make their own investment decisions for their retirement savings.
  • The benefits include tax advantages, flexibility, and control over investment choices.
  • To open an account, you can do so easily through the Moneybox app or website.
  • You can transfer your existing pension providing you meet certain eligibility criteria

The fact that the total value of lost pension pots in the UK has skyrocketed from £19,4 billion in 2018 to £26,6 billion in 20221 should be a compelling enough reason to look into unifying all your old pension pots in a retirement savings product like the Moneybox SIPP.

This guide will walk you through the key features and benefits of this simplified approach to pension savings. 

With its user-friendly interface and a range of investment options tailored to both beginners and experienced investors, Moneybox aims to make the process of saving for retirement more accessible. 

However, it is essential to be aware of the higher fees and limited advanced features compared to those of traditional SIPPs.

In This Article, You Will Discover:

    At Every Investor, your go-to information platform for retirement financial planning, our content is backed by thorough research, ensuring you get only the most reliable information, and every piece of data and advice is fact-checked and verified to help you make informed decisions

    Read on to find out if the Moneybox SIPP could be the right fit for your retirement planning needs.

    Who Is Moneybox?

    Moneybox is a UK-based financial services company that offers an innovative app to help users save and invest their spare change.

    It rounds up purchases to the nearest pound and invests the difference.

    With a focus on simplicity, Moneybox aims to make investing accessible to everyone, regardless of their financial knowledge.

    They offer a range of investment options tailored to various goals and risk appetites.

    What Is a SIPP?

    A SIPP stands for Self-Invested Personal Pension, a UK-based retirement plan that grants investors the freedom to select where their pension funds are invested.

    This plan caters to individuals seeking direct involvement in their retirement planning.

    Unlike traditional pension schemes, SIPPs provide access to a diverse array of investment opportunities, such as equities, government securities, and real estate, offering personalized retirement strategy options.

    This distinct feature sets SIPPs apart in the realm of pension savings.

    How Does the Moneybox SIPP Work?

    The Moneybox SIPP works as a purely app-driven retirement savings plan with the main aim of consolidating all your old pension pots into one account. 

    Can I Transfer My Pension into a Moneybox SIPP?

    Yes, you can transfer your pension into a Moneybox SIPP.

    Moneybox offers a Self-Invested Personal Pension (SIPP) that allows you to consolidate your existing pensions into one plan for easier management and potentially better returns.

    By transferring your pension into a Moneybox SIPP, you gain the ability to choose from a range of investment options, including stocks, bonds, and funds, to build a portfolio that aligns with your investment goals.

    This flexibility and control over your pension funds can help you maximize your retirement savings and achieve your long-term financial objectives.

    Transferring your pension into a Moneybox SIPP offers several benefits.

    Firstly, it allows you to have a consolidated view of your pensions, simplifying the management of your retirement savings.

    Secondly, by choosing to invest your pension funds in a Moneybox SIPP, you have the potential to generate higher returns by diversifying your investments across different asset classes.

    Lastly, Moneybox provides a user-friendly mobile app that makes it easy to track and monitor your pension investments, ensuring that you stay in control of your financial future.

    What Are the Benefits of a Moneybox SIPP?

    The benefits of a Moneybox SIPP provider are primarily centred around its ease of use, investment options, and tax advantages.

    What Are the Drawbacks of a Moneybox SIPP?

    The drawbacks of a Moneybox SIPP include the fees, which may be higher than other providers, the fact that there is no drawdown option on retirement, and the limited advanced features for experienced investors.

    Who Is Eligible to Open a Moneybox SIPP?

    UK residents over the age of 18 are eligible to open a Moneybox SIPP.

    What Should You Consider Before Choosing a Moneybox SIPP?

    Before choosing a Moneybox SIPP, you should consider your investment knowledge, the fees, and whether the platform offers the investment options that suit your retirement goals.

    Fees & Charges

    The fees and charges include an annual fee of 0,45% for pots up to £100,000, 0,15% for anything above that, plus a fund provider fee ranging from 0,12% to 0,30%.

    Investment Options

    The investment options available with this SIPP may not be as extensive as those of some other SIPPs, but Moneybox does offer a simplified approach for individuals who may be new to investing or those who prefer a hands-off investment strategy for their retirement savings. 

    You can choose from four Starter funds based on your preferences and risk tolerance. 

    Specifically:

    • Fidelity World Index Fund: Targets global equities.
    • Old Mutual World ESG Index Fund: Focuses on ESG-compliant companies.
    • BlackRock LifePath Fund: Adjusts asset allocation as you near retirement.
    • HSBC Islamic Global Equity Fund: Complies with Islamic finance principles.

    For more customisation, Moneybox provides seven additional tracker funds across various sectors and asset classes, such as Emerging Markets by Fidelity, Global Health & Pharmaceuticals by Legal & General, and Global Property Shares ESG by iShares by BlackRock. 

    You have the flexibility to change your fund allocation at any time through the app.3

    Flexibility & Accessibility

    The Moneybox SIPP stands out for its flexibility and accessibility, largely thanks to its app-based management system, which allows you to track performance and make changes to your investment choices all in one place. 

    However, there are some limitations on flexibility: Moneybox only allows transfers of old pensions—you cannot move a pension from your current employer into this SIPP.4

    While this might not be a significant issue for some, it may restrict others who want all their pensions, including their current one, in a single location.

    Tax Benefits & Implications

    The tax benefits and implications of a MoneyBox SIPP are the same as those of any other Self-Invested Personal Pension, making it an appealing option for retirement savings. 

    Contributions into the SIPP receive tax relief at your marginal rate, effectively reducing the cost of investing for your retirement. 

    Furthermore

    The investments within the SIPP grow untaxed, which means you will not pay capital gains tax or income tax on dividends.

    However, it is essential to understand the tax implications upon withdrawal: You can typically access your pension funds starting at age 55, and up to 25% of your pension pot can be withdrawn untaxed.5

    Remember

    Tax rules can change at any time, so it is useful to consult a tax advisor to fully understand the implications based on your specific situation.

    Withdrawal & Retirement Options

    The withdrawal and retirement options in Moneybox SIPP allow you the option to start accessing your pension funds at age 55, although you can choose to only do so later on. 

    One of the cons of this product is that it does not offer a direct drawdown feature, meaning you will first have to withdraw the entire amount and transfer it to a provider that offers drawdown. 

    Alternatively, you could buy an annuity.6

    Customer Support & Service

    Moneybox’s customer service and support are in line with its digital-first approach of prioritising convenience and self-service over traditional customer service avenues.

    Most interactions are through in-app chat, but the platform makes up for the lack of human interaction by providing a range of educational resources like easy-to-digest videos and blog posts that cover the basics of finance and keep users updated on the latest news. 

    What Are the Contribution Limits of a Moneybox SIPP?

    The contribution limits of a Moneybox SIPP are governed by HM Revenue and Customs and are currently £60,000 or 100% of your earnings, whichever is the lower.7

    Who Is the Moneybox SIPP Suited to?

    The Moneybox SIPP is suited to reasonably tech-savvy people who are new to investing and want a simplified way to save for retirement. 

    You should consider a Moneybox SIPP if you are looking for a no-fuss option for managing your pension.

    First off

    Moneybox will help you track down any pension accounts you may have accumulated during your working life and tie them all neatly together in one pot. 

    It also has a nifty round-up feature where spare change from everyday transactions is collected and invested.8

    For example

    Your daily £4,10 Costa cappuccino will be rounded up and the 90p difference will be deposited in your SIPP.

    How Does a Moneybox SIPP Compare With Other Options?

    A Moneybox SIPP compares reasonably well with other options, despite the fact that it is not a true SIPP in the traditional sense, as it offers limited investment and withdrawal options. 

    However, what it lacks in flexibility, it makes up for in convenience and ease of use. 

    By contrast

    Traditional SIPPs often offer a wider range of investment options and withdrawal features but require more hands-on management and investment experience. 

    This makes Moneybox a more streamlined but less customisable option, suitable for those who prioritise simplicity over the ability to tailor their investments and withdrawal strategies.

    Price-wise, it ranks up there with Hargreaves Lansdown at 0,45%, but with far fewer frills.9

    What Are Clients Saying About Moneybox?

    What clients are saying about Moneybox generally falls into two categories: praise for its user-friendly interface and criticism for its higher fees and limited features. 

    On Apple’s App Store, Moneybox has garnered over 32,500 reviews with an average rating of 4,8 stars out of 5.10 

    The Google Play Store shows similar enthusiasm, with over 10,700 customer reviews resulting in an average rating of 4,3 stars.11 

    Trustpilot adds another perspective, hosting over 1,600 reviews with an average customer rating of 4.5 stars out of five.12 

    Opening a Moneybox SIPP

    Opening a Moneybox SIPP involves a few straightforward steps and requires some basic information about your previous pension plans.

    What Steps Do You Need to Follow?

    Opening a Moneybox SIPP starts with downloading the Moneybox app. 

    After downloading, go to the account tab and sign up for the pension waiting list.

    When your account becomes active, you will need to provide information about your previous pension funds and select an investment fund. 

    The Moneybox team will handle the transfer process and keep you updated.

    What Documents Do You Need?

    Besides proof of identity and proof of UK residence, you will also need details about your old pension funds, such as the names of the providers and policy numbers. 

    If you do not have this information readily available, Moneybox can assist in locating it for you.

    Regulatory Details

    Moneybox is regulated by the Financial Conduct Authority (FCA), promoting compliance with financial laws and regulations.

    Common Questions

    Why Is Moneybox SIPP Popular Among Young Investors

    What Fees Are Associated With Moneybox SIPP

    How Does Moneybox SIPP Facilitate Easy Savings

    What Investment Strategies Can Be Pursued With Moneybox SIPP

    Why Choose Moneybox SIPP for Hands-Off Investment

    Is a Moneybox SIPP Safe

    Can I Open a Moneybox SIPP Without Transferring an Old Pension Pot

    How Often Can I Access and Manage My Investments Within a Moneybox SIPP

    Can My Employer Pay Into My Moneybox SIPP

    What Happens to My Moneybox SIPP if I Change Jobs

    Can I Manage My Moneybox SIPP Online

    How Long Does It Typically Take to Open a Moneybox SIPP Account

    What Happens to My Moneybox SIPP When I Die

    In Conclusion

    In short, your personal financial goals should guide your decision. 

    Consulting a qualified financial advisor can provide tailored advice to see if this product aligns with your plans. 

    A Moneybox SIPP may be a convenient option for some, but the fees and limited features may not suit everyone. 

    Ultimately, assess your options carefully to determine if a Moneybox SIPP could be the right choice for you.

    Related Articles
    Scroll to Top