June 1, 2022

My Investments Update – June 2022

Nick Saving Money, Investing property, crowdfunding, events 8 Comments

Here is my latest monthly update about my investments. You can read my May 2022 Investments Update here if you like

I’ll begin as usual with my Nutmeg Stocks and Shares ISA. This is the largest investment I hold other than my Bestinvest SIPP (personal pension).

As the screenshot below of performance in the year to date shows, my main portfolio is currently valued at £20,512. Last month it stood at £20,799 so, after a roller-coaster month, that is a fall of £287.

Apart from my main portfolio, I also have a second, smaller pot using Nutmeg’s Smart Alpha option. This is now worth £3,119 compared with £3,166 last month, a fall of £47

Here is a screen capture showing performance this year.

Obviously the continuing falls are disappointing (though much smaller than last month). As I’ve noted previously on PAS, you do have to expect ups and downs with equity-based investments, and certainly over the last few months there has been no shortage of volatility in world markets. And it’s also worth noting that since I started investing with Nutmeg in 2016 I have still enjoyed a total return of 36.48% (or 62.07% time-weighted).

I should also mention that I selected quite a high risk level for both my Nutmeg accounts (9/10 for the main one and 5/5 for Smart Alpha). This has served me well generally, but I’m sure investors who selected lower risk levels will have seen smaller falls over the last two months.

If you also have a Nutmeg portfolio and plan to withdraw from it in the next few months, there is certainly a case for switching to a lower risk level right now.

You can read my full Nutmeg review here (including a special offer at the end for PAS readers). If you are looking for a home for your annual ISA allowance, based on my experience over the last six years, they are certainly worth considering.

If you haven’t yet seen it, check out also my blog post in which I looked at the performance of Nutmeg fully managed portfolios at every risk level from 1 to 10 (as mentioned, my main port is level 9). I was actually pretty amazed by the difference the risk level you choose makes. If you are investing for the long term (and you almost certainly should be) opting for a hyper-cautious low-risk strategy may not be the smartest thing to do.

Moving on, my Assetz Exchange investments continue to perform well. Regular readers will know that this is a P2P property investment platform focusing on lower-risk properties (e.g. sheltered housing). I put an initial £100 into this in mid-February 2021 and another £400 in April. In June 2021 I added another £500, bringing my total investment up to £1,000.

Since I opened my account, my AE portfolio has generated £57.24 in revenue from rental and £92.28 in capital growth, a total of £149.52. That’s a decent rate of return on my £1,000 investment and does illustrate the value of P2P property investment for diversifying your portfolio when equity markets are volatile (as at the moment).

I now have investments in 22 different projects and all are performing as expected, generating rental income and – in every case but one – showing a profit on capital. So I am very happy with how this investment has been doing. And it doesn’t hurt that most projects are socially beneficial as well.

To control risk with all my property crowdfunding investments nowadays, I invest relatively modest amounts in individual projects. This is a particular attraction of AE as far as i am concerned. You can actually invest from as little as 80p per property if you really want to proceed cautiously.

My investment on Assetz Exchange is in the form of an IFISA so there won’t be any tax to pay on profits, dividends or capital gains. I’ve been impressed by my experiences with Assetz Exchange and the returns generated so far, and intend to continue investing with them. You can read my full review of Assetz Exchange here. You can also sign up for an account on Assetz Exchange directly via this link [affiliate].

Another property platform I have investments with is Kuflink. They have been doing well recently, with new projects launching almost every day. I currently have over £2,150 invested with them, quite a large proportion of which comes from reinvested profits. To date I have never lost any money with Kuflink, though some loan terms have been extended once or twice. On the plus side, when this happens additional interest is paid for the period in question. At present all my Kuflink loans are performing to schedule, though one is showing as ‘pending a status update’. I suspect this may translate to a delay in repayment. We shall see.

My loans with Kuflink pay annual interest rates of 6 to 7.5 percent. These days I invest no more than around £150 per loan (and often less). That is not because of any issues with Kuflink but more to do with losses of larger amounts on other P2P property platforms in the past. My days of putting four-figure sums into any single property investment are behind me now!

Nowadays I mainly opt to reinvest the monthly repayments I receive from Kuflink, which has the effect of boosting the percentage rate of return on the projects in question

Obviously a possible drawback with Kuflink and similar platforms is that your money is tied up in bricks and mortar, so not as easily accessible as cash savings or even (to some extent) shares. They do, however, have a secondary market on which you can offer any loan part for sale (as long as the loan in question is performing and not in arrears). Clearly that does depend on someone else wanting to buy it, but my experience has been that any loan parts offered are typically snapped up very quickly. So if an urgent need arises, withdrawing your money (or part of it) is unlikely to be an issue.

You can read my full Kuflink review here. They offer a variety of investment options, including a tax-free IFISA paying up to 7% interest per year with built-in automatic diversification. Alternatively you can now build your own IFISA, with most loans on the platform (including the one shown above) being IFISA-eligible.

I also recently published a blog post about another P2P property investment platform called BLEND. Like Kuflink, they offer the opportunity to invest in secured loans to experienced property developers. They offer (on average) somewhat higher rates of return than Kuflink, though arguably with a little more risk. As well as my blog post about BLEND, you can also check out what they have to offer on their website [affiliate link].

As mentioned last time, I invested some more money in European crowdlending platform Nibble last month. On this occasion I invested in their Legal Strategy. The loans in question are in default and facing legal action. Nibble buy these loans at a heavily discounted rate and then seek to recover as much as possible of the money owed. The minimum investment is 10 euro and the minimum period is six months.

The Legal Strategy comes with a deposit-back guarantee. This is a guarantee to return the full investment amount at the end of the investment period and a minimum yield of 9% per annum. The actual yield will depend on how successful recovery efforts prove, so in practice you may end up with a return of anywhere between 9% and 14.5%. All is going well so far, but I will obviously continue to report on this in the months ahead.

I recently updated my original review of Nibble, which you can read here if you wish. You can also sign up directly on the Nibble website if you like [affiliate link].

One other thing I wanted to mention is that I have just opened an account with online share trading/investment platform eToro. I’ve been planning to do this for a while, with a view to reviewing it on PAS. I’m finding it quite different from other online investment platforms I have used such as Bestinvest.

As well as commission-free share trading, eToro offer a popular copy-trading feature, where you can copy the trades of other successful investors automatically. You can also practise with a virtual portfolio of $100,000. I put some of this into Platinum on the eToro commodities market and initially its value soared. But then it went right down again. So I am not the investment genius I thought I was at first 😀 It’s all very interesting, though. If you’d like to check out eToro for yourself, here’s an invitation link [affiliate]. And keep an eye open for my full review in due course.

Moving on, I have two more articles on the always-excellent Mouthy Money website. The first concerns Two Important State Benefits Many Older People Are Missing Out On. And the second is on the subject Could You Make Money as a Blogger? I have been blogging for over twenty years now, initially about freelance writing and now about personal finance. So I had plenty to talk about in this article!

Incidentally, Mouthy Money currently have a vacancy for a graduate-level personal finance reporter. This is a one-year paid internship working partly from home and partly from MM’s London office. If you know anyone who might be interested in this opportunity, please do draw it to their attention.

Finally, there has been a lot of talk about the cost of living crisis this month. As you may know, Chancellor Rishi Sunak announced a raft of measures to try to mitigate the worst effects of this.

Whatever your political or economic views, I do think he has been quite generous to older people in particular. Not only will those of us receiving the state pension get £400 off our household energy bills, we will also receive an extra £300 on top of our usual Winter Fuel Allowance (that means I’ll get £500 this year).

Many pensioners will also qualify for the £150 bonus for those on non-means-tested disability benefits such as Attendance Allowance. And they may also get the £650 cost of living payment going to anyone receiving various means-tested benefits (everyone getting pension credit will qualify for this, for example). Some households will receive a total of £1,500 in additional benefits through these measures, which should certainly help in these challenging times. .

If you would like to know more about the latest round of financial support from the government, Martin Lewis has a good summary on his Moneysaving Expert website. The government has also published a web page which sets out all the help that may be available for those on lower incomes.

That’s enough for today, so I’ll close by wishing you a very happy Jubilee Holiday. Whatever you are doing in the next few days – going away or staying home with family and friends – I do hope you have a relaxing and enjoyable time. As ever, if you have any comments or queries, please feel free to leave them below. I always love hearing from my readers 🙂

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that posts may include affiliate links. If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered, but it does help support me in publishing PAS and paying my bills. Thank you!

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May 18, 2022

Spotlight: How Are People In Britain Saving?

Nick Saving Money, Investing infographic 4 Comments

HSBC Bank (in association with pollsters YouGov) recently conducted a survey on saving in Britain. This looked at people’s savings habits and came up with some eye-opening results. I have summarized the main findings below, with graphics where relevant.

What Are the Most Popular Savings Options?

Unsurprisingly, the survey found that cash was Britain’s most popular saving option, with 53% of people saving this way. Other methods are also popular, however, as the graphic below shows.

The survey also found noticeable regional differences in savings habits. London appears to lead the way on cryptocurrency, with 6% of residents saving this way. People in the East of England are the most likely to invest in shares (23%), Scotland sees the most people investing in a pension (35%), and Wales has the highest proportion of investors in gold (4%) and antiques (4%).

Couples living together top the table for people trying to save (60%), ahead of those who have never married (57%) and those who are married or in civil partnerships (55%).

The survey data also suggests a gender divide, with men more likely than women (57% vs 53%) to say they are actively saving in general. Men are also more likely than women to be saving into a pension (35% vs 26%) and are nearly twice as likely to invest in shares (21% vs 12%). This is summed up in the graphic below.

Only just over half (55%) of the population say they are actively saving for the future, but the survey found younger age groups were more likely to be putting cash aside, with 62% of 18-34 year-olds saying they were regularly saving, compared with 55% of those aged 45-54.

And while there’s only a small difference between men and women when it comes to putting money away in cash (54% vs 52%), the data does suggest a wider divide when it comes to other types of investments. As mentioned above, more men than women (35% vs 26%) say they are saving into a pension. Men are also nearly twice as likely to invest in shares (21% vs 12%) and investment funds (12% vs 6%) – while six times more men than women say they have bought into cryptocurrencies.

My Thoughts

As a money blogger, it was interesting for me to see this snapshot of how people in Britain currently save for the future.

One thing that struck me was the relatively small number of people – and women especially – who invest in stocks and shares. Although this can be riskier in the short term, if you are saving for the medium- to long-term, history shows that you are likely to get better results investing in equities (probably via a collective vehicle such as a tracker or investment fund) rather than cash.

Right now, the best interest rate you can get on cash savings is about 1.5%. With inflation in the UK currently up to an eye-watering 9%, this means money kept in a savings account will be losing value in real terms.

Of course, we all need cash savings to fall back on when the unexpected happens (a popular rule of thumb here is three to six months’ worth of expenditure). And there may also be particular things you are saving up for, e.g. a deposit on a house. In that case, you may prefer to save into a cash account, so your money is protected under the Financial Services Compensation Scheme and readily available when the time comes.

But if you are saving for the (indefinite) future and/or retirement, over a period of years investing is very likely to produce better returns for you. To give you an example from my own experience, regular readers will know I have (currently) around £23,500 in the robo-investment platform Nutmeg. Since the start of this year, with the war in Ukraine and inflation fears, the value of my Nutmeg portfolio has fallen by 7.5%. In the six years I have been investing with Nutmeg, however, my portfolio has grown by 60% (time-weighted). Clearly in the last six years I wouldn’t have made anything like that if my money had been in a cash savings account.

Obviously with investing you have to expect ups and downs, which is why you should only invest on a medium- to long-term basis. But over a period of years, investments have almost always out-performed cash savings, often by a considerable margin.

So I do believe everyone should educate themselves about investing and perhaps take professional advice about it too. I would also like to see more taught about investing in schools. And if you have children (or grandchildren), I recommend introducing them to investing from an early age. A Junior ISA can be one very good way of doing this 🙂

One other observation is that the HSBC/YouGov survey makes no mention of crowdlending/peer-to-peer (P2P) saving/investing. This has admittedly lost some of its sheen in recent years, with projects failing and several platforms collapsing. Some people – me included – have lost money with this. However, I do still believe in the potential of investing this way, as long as you are sensible and diversify as much as possible to spread the risk.

Again, regular readers will know that I have modest amounts invested with the property crowdlending platform Kuflink and crowdfunding platform Assetz Exchange. Both of these have been doing well for me and generating returns of 6% or more. I also have a small amount in the European business crowdlending platform Nibble. Clearly this type of investment is riskier than bank savings, as your money is not protected by the FSCS. But returns can be significantly higher, and unlike equity-based investments they are not directly affected by the ups and downs of the stock markets. The latter can be reassuring when markets are volatile, as at present.

Finally, in case anyone is wondering, I am not a fan of cryptocurrencies and don’t therefore invest in them myself or write about them on PAS. As this recent article indicates, while you can certainly make money with crypto if you’re lucky, it’s also very possible to lose your shirt!

Thank you to my friends at HSBC for allowing me to use their survey results and infographics. They also have some tips here on how to save money and stick to your savings goals.

As ever, if you have any comments about this post and/or any of the survey findings mentioned above, please do share them in the comments as usual.

Disclaimer: I am not a qualified financial adviser and nothing in this post should be construed as individual financial advice. You should always do your own ‘due dligence’ before investing, and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

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May 12, 2022

Could You Be a Holiday Let Landlord?

Nick Making Money, Investing 3 Comments

Tourism in many parts of the UK is booming right now.

As we come out of the pandemic some people are venturing abroad again. But many others (perhaps deterred by the remaining restrictions and long queues and cancellations at airports) have been discovering (or rediscovering) what this country has to offer. This in turn has led to a growing demand for holiday rentals. That is only likely to increase as overseas visitors start to return as well.

There is undoubtedly money to be made from holiday lets, so in my post today I shall be looking at this subject in more detail. The article is written in association with my friends at the Suffolk Building Society and I shall be quoting from their detailed research on this subject (and using some of their graphics!).

Let’s start with the most crucial consideration for would-be holiday let landlords…

Setting

A recent study by the Suffolk Building Society found that the setting of a property was more important for potential landlords than other factors such as renovation potential or proximity to amenities. The key aspects for would-be landlords when considering buying a holiday let were:

A property that is in or near beautiful scenery (31%)
A property that is near the beach or coast (30%)
A property that is easy to manage and doesn’t require much upkeep (28%)
A property that is in an area that the landlord already personally knows or loves (27%)
A property that is in a popular tourist or holiday destination (23%)

This is summed up in the graphic below.

Location

As you can see in the graphic below, Devon and Cornwall were the locations most aspiring holiday let landlords were considering, followed by the Lake District, Peak District and Yorkshire Dales.

How Much Can You Make?

Being a holiday let landlord has many attractions, including significantly higher returns than are achievable from residential lets.

An apartment in a popular tourist area, for example, can generate £1,000 a week or more (in peak season at least). A recent report in Which? found that the average annual yield on a holiday let was just over 10%. This compares favourably with residential buy-to-lets, where around 7% a year is more typical. The Which? article mentioned above forecasts holiday let yields rising in future to 14% or more.

According to Sykes Holiday Cottages, the average holiday let owner is earning approximately £21,000 per year. You can also enjoy cheap holidays staying at the property yourself. And there are tax advantages too, as running a furnished holiday let (FHL) is considered a trade rather than an investment. This means you can offset mortgage interest costs against your income, as well as council tax and other bills.

On the downside, being a holiday let landlord is likely to be more hands-on. New tenants will move in every few days and the property will need to be cleaned, tidied and restocked on a regular basis. Covid precautions have added an extra dimension to this (though rules are now easing). There will be more admin dealing with a steady stream of enquiries and visitors. You will need to budget for advertising too, or risk ‘voids’ when your property is empty and you are losing rather than making money. And finally, any garden at the property will need tending as well.

You can of course outsource some (or all) of this work to a management agency, but naturally there will be a cost to this, impacting your bottom line

Tips for Would-be Holiday Let Landlords

If you are planning to buy a holiday let property with a mortgage (as most people do), there are some important things to bear in mind. Buying a holiday let differs in some significant ways from buying a home to live in or even a traditional buy-to-let.

Be aware that many holiday let mortgages require a landlord to have a mortgage, own their main residential property first, or have buy-to-let properties already – and in some instances, a combination of these.
Understand that some lenders also have age restrictions for first time landlords, even if they are already residential home owners.
Affordability assessments for holiday-let properties are usually calculated on the property’s rental potential rather than personal income and outgoings, but the lender will still want to understand the applicant’s financial position.
Applicants may have to demonstrate a minimum income set by the lender, but this income can often be from a combination of employment, self-employment, investments, pensions, and so on.
Be prepared to show third-party evidence of rental value in low, mid and high seasons from a verified lettings agent – even if not planning on using an agency to manage the property.
Expect that the property will also be assessed by the mortgage lender. Properties in holiday parks, caravans or lodges, and those of unusual construction method may not always be accepted.
Applicants should not assume they can market their property on short-term lettings sites such as Airbnb and Vrbo – some mortgage lenders have rules that prohibit this.
Check the amount of personal use allowed so as not to breach terms and conditions. Mortgage companies will always allow the owner a certain amount of personal use but this can vary.
Check whether the mortgage lender has a limit on the number of holiday let and/or buy to let properties that the landlord is allowed to own.
Specialist holiday letting insurance must be arranged with public liability cover (typically minimum £1 million) included.

Suffolk Building Society’s Head of Mortgages, Charlotte Grimshaw, says: ‘Before jumping on the [holiday let] bandwagon, potential owners should do their due diligence; consider the financial commitments of not just the purchase but the maintenance, taxes, and other expenses such as cleaners and gardeners. It’s also worth taking the time to understand the market, and check out the competition before falling in love with a property that isn’t viable in terms of lettings.’

And she adds: ‘Applying for a holiday let mortgage can be a little more complex than applying for a traditional residential property or buy to let, so it can be helpful to approach an independent mortgage adviser to ensure the application has the best chance of success. A mortgage adviser will also have a good understanding of the different criteria that mortgage companies request, helping landlords find the most suitable product.’

Final Thoughts

Thank you again to my friends at Suffolk Building Society for their help with this article. I hope it has opened your eyes to the money-making potential of holiday lets. And if you are among the 17% of UK adults who (according to the SBS survey) considered buying a holiday let property during the pandemic, I hope it has given you some points to think about.

SBS offer holiday let mortgages themselves (along with standard buy-to-let and other mortgages). You can read more about their holiday let mortgages here.

You might also enjoy reading my blog post Can You Still Make Money From Buy to Let? although this is more about letting residential property.

As always, if you have any comments or questions about this post, please do leave them below.

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May 6, 2022

Nibble Review – European Crowdlending Investment Platform Open To Everyone

Nick Making Money, Investing crowdfunding 7 Comments

UPDATED 27 May 2022

Regular readers of PAS will know I have a particular interest in P2P/crowdlending investment. Such platforms offer the opportunity to invest in loans to businesses or individuals and profit from the interest charged to borrowers.

With savings account interest rates still very low, many investors are understandably looking for better returns on their savings and investments. If that applies to you, European crowdlending platform Nibble is worth a look.

What is Nibble?

Nibble is a crowdlending platform launched in 2020 by IT Smart Finance, a company with over five years’ experience developing innovative products in financial technology.

Nibble’s business method involves investing in P2P loans to businesses made through Joymoney (the flagship product of the ITSF group). Private investors can then invest in these loans to take advantage of the interest paid by borrowers.

What Are the Benefits?

Probably the biggest attraction of Nibble to investors is that it offers returns on investment of up to 14.5%. As you will doubtless know, this is well above the average in the collective financing industry.

The minimum investment with Nibble is just €10 (about £8.40 at current exchange rates). The platform has an auto-investment tool, allowing trading to be fast and straightforward. You aren’t required to choose individual loan investments, as this is handled by the company. You simply choose one of three investment strategies (see below) based on the timescale over which you wish to invest and the level of risk you are comfortable with.

Other attractions include a minimum investment period of as little as one month, with interest credited to your account weekly. You can withdraw the interest if you wish or reinvest it in an existing or new portfolio.

In addition, if you want to withdraw money from your account early, Nibble say they will find a new investor for your portfolio for a small commission fee.

What Are the Risks?

Obviously no investment is without risk, but Nibble have gone to some lengths to keep this as low as possible. You can read a detailed article about this on this page of the Nibble website (warning: it is quite long!).

For investors opting for the lowest-risk Classic Strategy (see below) a Buyback Guarantee applies. That means that if a borrower defaults on payment, the company will return your money, including interest earned, for the time you held the loan.

For the other two, higher-paying strategies, the risk is shared between the investor and the platform in the form of a variable interest rate. The rate paid is decided by the Risk Committee, which meets monthly to assess how loan portfolios are performing and set rates accordingly. The actual rates paid therefore vary from month to month.

Obviously the other risk is that the lending company itself will go bust. For various reasons set out on the Nibble website this appears unlikely, but of course it is not impossible. If that were to happen, you would not be covered by the Financial Services Compensation Scheme (FSCS) which covers deposits in registered UK savings institutions up to £85,000. Nibble say that in the worst case scenario ‘a management company will be assigned to help the investor to recover funds in accordance with the rights of claim against the borrower. In addition, there is always a reserve fund which serves as an additional “safety airbag” for the investor.’

Finally, as loans are currently all in euro, UK investors will of course have to contend with exchange rate fluctuations, which could work for or against you.

How Do You Get Started?

If you wish to invest via Nibble, the first thing you will need to do is set up an account via the Nibble website.

As Nibble is a European operation, you will need to invest in euro and your returns will be paid in this currency. That obviously adds a layer of extra complexity for UK citizens, but there are various ways round this. If you have a UK bank account you will normally be able to make (and receive) payments in euro, but may be charged a NSTF (Non-Sterling Transaction Fee).

You could use your own bank to fund your account initially, but if you become a regular investor with Nibble you might want to use a service or account that charges lower fees. You could use a money transfer service such as Paysera or Wise (formally TransferWise). These will enable you to transfer funds between Nibble and your own bank account with lower charges (and potentially a more favourable exchange rate). Another option would be to open a Euro account with a provider such as Starling. This will allow you to receive and make payments in both sterling and euro, again at a lower overall cost.

Nibble offers investors a choice of three investment strategies according to income and risk preferences. They call this approach Flexible Investment. The three strategies are called Classic, Balanced and Legal. They differ in the level of income on offer, the degree of risk, and how those risks are distributed between the platform and the user. Each strategy is described below using screen captures from the Nibble website.

Classic Strategy

As you can see, this strategy offers the lowest level of risk and also the lowest rate of return (though still a respectable 8% at time of writing and up to 9.7% if you reinvest every time your investment matures). You can start with as little as 10 euro for a minimum period of just one month, so this may be a good way to test the water initially. Be aware that the minimum withdrawal is 50 euro though.

An important thing to note here is the BuyBack Guarantee. As mentioned above, this means that if a borrower defaults on their payment, the company will return your money, including interest earned, for the time you held the loan. That significantly reduces the risk of investing.

Balanced Strategy

As you will see, the Balanced Strategy offers higher potential returns than the Classic Strategy but without the safety net of the Buyback Guarantee. The minimum investment amount is 100 euro and the minimum period seven months. According to Nibble this is the most popular strategy among investors, with almost 2/3 opting for it.

Legal Strategy

The Legal Strategy offers the highest potential returns. The loans in question are in default and facing legal action (hence the name). Nibble buy these loans at a heavily discounted rate and then seek to recover as much as possible of the amount owed. The minimum investment amount is 10 euro and the minimum period is six months.

As you can see, the Legal Strategy comes with a deposit back guarantee. This is a guarantee to return the full investment amount at the end of the investment period and a minimum yield of 9% per annum. The actual yield paid will depend on how successful recovery efforts prove, so you may end up with a return of anywhere between 9% and 14.5%.

According to Nibble 13% of their investors choose this strategy, which is a fairly new one.

My Experience

I wanted to try out Nibble myself,so I set up an account with them. The process was quick and straightforward. You just click on Create Account at the top of the Nibble homepage and follow the online instructions.

You are required to complete a short verification process before opening your account. This involves taking a photo of your passport, driving licence or some other form of ID, along with a selfie. You may use your mobile phone camera for this. It all worked smoothly and seamlessly in my case, and within a couple of minutes my application had been verified and approved.

After that, it is just a matter of making your initial deposit and deciding which of the strategies mentioned above you want to use. I chose the Classic Strategy as a low-risk test and so far everything has gone as promised. Interest is credited to my account every week, and so far at the end of each investment period I have reinvested all the capital and interest received.

I plan to try out the new Legal Strategy myself and will report in due course how this goes.

Closing Thoughts

If you are looking for a more exciting home for some of your cash that allows you to take advantage of the higher interest rates on offer in Spain (and other countries soon), Nibble is worth checking out.

I like the low minimum investment for the Classic Strategy and the fact that the minimum loan period for this is just a month. That allows you to try out the platform without risking too much or tying up your funds for too long. The BuyBack Guarantee provides additional reassurance. The other strategies offer higher rates of interest, though it is important to note the longer investment periods and the fact that rates paid may vary from month to month.

The website’s ease of use is another attraction, as is the fact that Nibble doesn’t impose any fees or charges on investors. As mentioned above, you do just need to bear in mind the need to switch between pounds and euro and the importance of minimizing the costs associated with this.

As a Spanish-based company NIbble doesn’t have too many UK reviews, but those that I have seen are almost entirely positive. On the popular independent Trustpilot website, they get an average score of 4.2 (‘Great’) with 75% of reviewers awarding them a maximum five star rating.

My advice if you want to try Nibble would be to start by investing modestly using the Classic Strategy (as I have). This will allow you to see how the platform works and get your capital returned with interest in as little as 30 days. You can then move on to the other investment options (Balanced and Legal) for bigger potential returns if you wish.

I have just made a small additional investment in the Nibble Legal Strategy, so will be saying more about this soon.

Obviously, nobody should put all their money into Nibble, but it is worth considering within a diversified savings and investments portfolio, especially in the current low-interest savings environment. As stated above, you should also bear in mind that your money won’t be protected by the Financial Services Compensation Scheme (FSCS), which protects deposits of up to £85,000 in most UK bank accounts. Of course, P2P/crowdlending platforms in the UK are not generally covered by the FSCS either.

I will, of course, continue to report on Pounds and Sense how my Nibble investments fare.

As always, if you have any comments or questions about this post, please do leave them below.

Note: This is a fully updated version of my original Nibble review from 2021.

Disclaimer: I am not a qualified independent financial adviser and nothing in this post should be construed as personal financial advice. You should always do your own ‘due diligence’ before investing and seek professional advice if unsure how best to proceed. All investing carries a risk of loss. Note also that this review includes my affiliate (referral) links, so if you click through and end up investing with Nibble, I may receive a commission for introducing you. This will not affect the price you pay or the product/service you receive.

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April 7, 2022

Spotlight: The Bestinvest Investment Platform

Nick Investing reviews 4 Comments

Today I’m looking at Bestinvest, an investment platform I have used myself for many years. My SIPP (Self Invested Personal Pension) is held with them.

Bestinvest was founded in 1986, so it is one of the UK’s longest established platforms. In 2014 they merged with Tilney, and the company rebranded as Tilney Group in 2017.

Bestinvest has around £2.7 billion in assets under management (AUM). This puts it in the mid-size category, some way behind the UK’s three biggest investment platforms, Hargreaves Lansdown, AJ Bell YouInvest and Interactive Investor.

Of course, size isn’t everything. As a well-established platform with competitive fees and a reputation for high-quality customer service, Bestinvest has plenty to offer discerning investors.

What Does Bestinvest Offer?

Bestinvest offers four main types of account. These are:

General Investment Accounts can be used for investments outside your tax-free allowance (e.g. the £20,000 annual ISA allowance). You can also use this account for day-to-day share trading. But be aware that any income or capital gains generated within this account (above your personal allowance) may be liable for income tax, dividend tax and/or capital gains tax.

Within their accounts, investors can select from a wide range of funds and individual company shares. You can choose from over 2,500 funds, UK shares, ETFs, and investment trusts. There is no access to US shares, though. So if that is something you might require, another platform such as Hargreaves Lansdown or eToro might be a better choice for you.

As someone asked me this, I should maybe clarify that while you can’t buy US shares directly on Bestinvest, you can of course buy funds investing in the US market if you wish. Personally I have some of my SIPP money invested in the HSBC American Index C fund.

What Are The Charges?

Bestinvest recently revamped and in many cases reduced their charges. They are now highly competitive in many areas.

For most accounts there is a tiered platform fee. This begins at 0.4% for the first £250,000, 0.2% for the next £250,000, 0.1% for £500,000 to £1,000,000, and zero over that.

Bestinvest do, however, offer a range of ready-made portfolios, where the fee for the first £250,000 is just 0.2%. This is half the standard rate (and makes them extremely competitive with other platforms). For more information about fees and charges, see the Bestinvest website.

Buying and selling funds on Bestinvest is free (though you will of course still have to pay fund charges). Bestinvest recently slashed their share dealing charge to £4.95 per deal.

Information and Advice

Bestinvest is aimed at people who are comfortable choosing their own investments. They do, though, offer plenty of information and advice for investors, much of it for free.

As mentioned above, they have a range of ready-made portfolios you can choose from. Bestinvest charge half their normal fee for these (0.2% rather than 0.4% for the first £250,000). They comprise a carefully selected collection of investments, so you don’t have to spend time choosing yourself. They have two fund ranges, Expert and Smart. Each has different investment portfolios, from defensive to maximum growth and everything in between. If your focus is sustainability or income, they have funds for those as well.

But if you prefer to choose your own investments, Bestinvest have tools and articles to assist with this too. Their investment search tool lets you search according to a wide range of criteria. You can then access in-depth information on any potential investments that look appealing.

Advice from registered financial advisers is also available via the Bestinvest platform. If you plan to invest over £20,000 in ready-made portfolios, personalized advice about choosing the best option/s for you is available for free. You can also get free ‘coaching’ calls, and more in-depth personal financial advice, for which there is a charge. Again, see the Bestinvest website for more information.

What Are the Pros and Cons of Bestinvest?

PROS

Well-established platform with a large client base
Range of accounts to meet most needs
Well-designed, user-friendly website
No dealing fees when buying or selling funds
Reasonable fees (£4.95) when buying shares
Low minimum investment (just £50 in most cases)
Highly rated UK-based customer service
Information, advice and ready-made portfolios available
Ready-made portfolios are exceptionally good value
User-friendly investment research tools
Bestinvest pay up to £500 towards any exit fees your current providers charge when you transfer your investments to them

CONS

No access to US shares
No mobile app currently
Some users have had issues with the website (though see below)

What Do Users Think?

On the independent TrustPilot website, Bestinvest has an average rating of 3.8 (‘Great’) at the time of writing, with 38% of users awarding them a maximum five stars rating. That is roughly on a par with other leading UK investment platforms.

Positive comments typically emphasize the high-quality customer service and range of advice and information available. Some of the negative comments concern issues with the website, though it is worth noting that this has just been revamped.

Bestinvest has also received various industry awards, including Best Customer Service at the 2021 Shares Awards run by Shares Magazine, and Best ISA Provider in the 2020 COLWMA Awards. You can see a full list of their recent industry awards here.

Closing Thoughts

If you are planning to start investing (or switch from your current platform) Bestinvest is certainly worthy of your consideration. It is a popular, well-established platform with a good range of accounts and services. Their charges are competitive, and (as I can testify from my many years as a client) their UK-based customer service is first rate.

The Bestinvest SIPP is widely considered their flagship product, and as I have one of these myself (now in drawdown) I wouldn’t argue with that. There are no set-up fees, no fund-dealing charges and they pay up to £500 towards your exit fees if transferring from another provider. The Bestinvest SIPP has recently become even more competitive with the scrapping of the £100 (plus VAT) administration fee and certain other charges. Note that there is still a minimum charge of £120 per annum, though.

Bestinvest’s ready-made portfolios are an attractive (and great value) option for novice investors and those who don’t have time to research all their investments themselves. But equally, if you are happy to pick your own funds and shares, Bestinvest has all the information and tools you will need.

While Bestinvest’s share-trading fees are relatively low, if you’re planning to buy and sell individual shares regularly, a low-cost dealing service such as eToro might be better for you. They offer commission-free trading on shares and charge no monthly account fee. That makes them ideal for short-term traders and investors looking to build a portfolio of shares cheaply. Of course, this is a riskier approach to investing, and not recommended for those new to the field.

As ever, if you have any comments or questions about this blog post or Bestinvest in particular, please do leave them below.

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that this post includes affiliate links. If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered.

If you enjoyed this post, please link to it on your own blog or social media:

April 1, 2022

My Investments Update April 2022

Nick Investing 4 Comments

Here is my latest monthly update about my investments. You can read my March 2022 Investments Update here if you like

I’ll begin as usual with my Nutmeg Stocks and Shares ISA, as I know many of you like to hear what is happening with this.

As the screenshot below shows, my main portfolio is currently valued at £21,646. Last month it stood at £20,859, so that is a rise of £787.

Apart from my main portfolio, I also have a second, smaller pot using Nutmeg’s Smart Alpha option. This is now worth £3,286 compared with £3,166 last month, a rise of £120

Here is a screen capture showing performance over the last month.

Obviously these rises are good news, and cancel out a good part of the falls since January this year. I hope this trend will continue in the coming months! I don’t know the exact reasons for the recovery in share prices, but I guess some of it may be down to the likelihood of nuclear Armageddon in Ukraine receding a bit. In any event, it does demonstrate the importance to investors of holding your nerve when prices fall and not bailing out at the first sign of trouble. As I often say on Pounds and Sense, investing should always be regarded as a medium- to long-term venture.

You can read my full Nutmeg review here (including a special offer at the end for PAS readers). If you are looking for a home for your annual ISA allowance, based on my experience over the last six years, they are certainly worth considering.

If you haven’t yet seen it, check out also my blog post in which I looked at the performance of Nutmeg fully managed portfolios at every risk level from 1 to 10 (as mentioned, my main port is level 9). I was actually pretty amazed by the difference the risk level you choose makes. If you are investing for the long term (and you almost certainly should be) opting for a hyper-cautious low-risk strategy may not be the smartest thing to do.

As regular readers will know, this year I am using Assetz Exchange for my IFISA. This is a P2P property investment platform that focuses on lower-risk properties (e.g. sheltered housing on long leases). I put an initial £100 into this in mid-February 2021 and another £400 in April. Everything went well, so in June 2021 I added another £500, bringing my total investment on the platform up to £1,000.

Since I opened my account, my Assetz Exchange portfolio has generated £47.60 in revenue from rental and £73.85 in capital growth, a total of £121.45. That’s a decent rate of return on my £1,000 investment and does illustrate the value of P2P property investment for diversifying your portfolio when equity markets are volatile.

At one time Assetz Exchange had a problem with demand from investors outstripping supply, but in recent months an influx of new projects has helped alleviate that. AE also has a sensible policy of limiting the amount any one person can invest in a project for the first few weeks (typically £2,000 to £3,000 maximum), to ensure everyone has a fair chance to participate.

I recently invested some of the rental income I’ve received in another project on AE, a housing association property for people with learning difficulties in Doncaster. I now have investments in 22 different projects and all are performing as expected, generating rental income and – in every case but one – showing a profit on capital. So I am very happy with how this investment has been doing. And it doesn’t hurt that most projects are socially beneficial as well.

To control risk with all my property crowdfunding investments nowadays, I invest relatively modest amounts in individual projects. This is a particular attraction of AE as far as i am concerned. You can actually invest from as little as 80p per property if you really want to proceed cautiously.

As mentioned, my investment on Assetz Exchange is in the form of an IFISA so there won’t be any tax to pay on profits, dividends or capital gains. I’ve been impressed by my experiences with Assetz Exchange and the returns generated so far, and intend to continue investing with them. You can read my full review of Assetz Exchange here. You can also sign up for an account on Assetz Exchange directly via this link [affiliate].

Another property platform I have investments with is Kuflink. They have been doing well recently, with new projects launching almost every day. I currently have over £2,150 invested with them, quite a large proportion of which comes from reinvested profits. To date I have never lost any money with Kuflink, though some loan terms have been extended once or twice. On the plus side, when this happens additional interest is paid for the period in question. At present all my Kuflink loans are performing to schedule, with several due to mature in the next three months. So I will be planning to reinvest with Kuflink as this happens, in projects such as the one below.

My loans with Kuflink pay annual interest rates of 6 to 7.5 percent. As mentioned above, these days I invest no more than around £150 per loan (and often less). That is not because of any issues with Kuflink but more to do with losses of larger amounts on other P2P property platforms in the past. My days of putting four-figure sums into any single property investment are behind me now!

Nowadays I mainly opt to reinvest the monthly repayments I receive from Kuflink, which has the effect of boosting the percentage rate of return on the projects in question

Obviously a possible drawback with Kuflink and similar platforms is that your money is tied up in bricks and mortar, so not as easily accessible as cash savings or even (to some extent) shares. They do, however, have a secondary market on which you can offer any loan part for sale (as long as the loan in question is performing and not in arrears). Clearly that does depend on someone else wanting to buy it, but my experience has been that any loan parts offered are typically snapped up very quickly. So if an urgent need arises, withdrawing your money (or part of it) is unlikely to be an issue.

You can read my full Kuflink review here. They offer a variety of investment options, including a tax-free IFISA paying up to 7% interest per year with built-in automatic diversification. Alternatively you can now build your own IFISA, with most loans on the platform (including the one shown above) being IFISA-eligible.

I’d also draw your attention to Kuflink’s revised and more generous cashback offer for new investors [affiliate link]. They are now paying cashback on new investments from as little as £500 (it used to be £1,000). And if you are looking to invest larger amounts, you can earn up to a maximum of £4,000 in cashback. That is one of the best cashback offers I have seen anywhere (though admittedly you will need to invest £100,000 or more to receive that!).

I also recently published a blog post about another P2P property investment platform called BLEND. Like Kuflink, they offer the opportunity to invest in secured loans to experienced property developers. They offer (on average) somewhat higher rates of return than Kuflink, though arguably with a little more risk. As well as my blog post about BLEND, you can also check out what they have to offer on their website [affiliate link].

Moving on, I have two more articles on the always-excellent Mouthy Money website. The first contains my best tips and advice about cruise holidays. As I say in the article, the cruise industry was hit hard by the pandemic, but it is up and running again now and desperate to lure holidaymakers back. So there are some great deals to be had at the moment!

My other Mouthy Money article is about two state benefits that many older people who would be eligible are currently missing out on. You can read this article here.

That’s plenty for now, so I’ll sign off till next time. I hope you are keeping safe and well, and making the most of the better weather and more relaxed Covid restrictions that now apply (apart from in Scotland). I am looking forward to visiting Llandudno in a few weeks time (and duly grateful the Welsh government has recently eased restrictions there). I also have breaks in Criccieth and Lavenham booked for later in the summer, with more to come. If you’re planning any UK holidays, don’t forget I have a list of places I have visited and recommend here 🙂

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that this post includes affiliate links (disclosed). If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered.

If you enjoyed this post, please link to it on your own blog or social media:

March 2, 2022

My Investments Update – March 2022

Nick Investing events, reviews, property 6 Comments

Here is my latest monthly update about my investments. You can read my February 2022 Investments Update here if you like

I’ll begin as usual with my Nutmeg Stocks and Shares ISA, as I know many of you like to hear what is happening with this.

As the screenshot below shows, my main portfolio is currently valued at £20,859. Last month it stood at £20,870, so that is a modest fall of £11.

Apart from my main portfolio, I also have a second, smaller pot using Nutmeg’s Smart Alpha option. This is now worth £3,166 compared with £2,682 last month. However, that includes an extra £500 I deposited in February. If you deduct this from the current value that gives a figure of £2,666, a net fall of £16.

Here is a screen capture showing performance over the last month.

Obviously a big factor affecting equity prices this month has been the situation in Ukraine. The orange dot on both charts above shows the date when Russia invaded.

The war in Ukraine is above all a human tragedy, but inevitably it has serious implications for investors as well. So far, as you can see from the charts, the invasion hasn’t had a major impact on my Nutmeg investments (there was actually a bigger fall the previous month, due partly to tensions in Ukraine but also to economic factors like rising inflation). But obviously, if things go badly in the coming weeks, there could be bigger losses to come.

Even so, I intend to stay calm and avoid any panic reaction. I certainly don’t intend to crystallize my losses since the start of 2022 by selling up. I have already topped up my investment once while asset values are depressed and intend to do so again before this year’s ISA allowance ends in April.

As I have said before on PAS, all equity investments should be regarded as medium to long term. And it is worth noting that since I started investing with Nutmeg in 2016 I have still enjoyed a total return on my main portfolio of 45.72% (or 64.72% time-weighted). I should also mention that I selected quite a high risk level for both my Nutmeg accounts (9/10 for the main one and 5/5 for Smart Alpha). This has served me well generally, but I’m sure investors who selected lower risk levels will have seen smaller falls over the last couple of months.

If you also have a Nutmeg portfolio and plan to withdraw from it in the next few months, there is certainly a good case for switching to a lower risk level right now.

You can read my full Nutmeg review here (including a special offer at the end for PAS readers). If you are still looking for a home for your 2021/22 ISA allowance, based on my experience over the last six years, they are certainly worth considering.

If you haven’t yet seen it, check out also my blog post in which I looked at the performance of Nutmeg fully managed portfolios at every risk level from 1 to 10 (as mentioned, my main port is level 9). I was actually pretty amazed by the difference the risk level you choose makes. If you are investing for the long term (and you almost certainly should be) opting for a hyper-cautious low-risk strategy may not be the smartest thing to do.

As regular readers will know, this year I am using Assetz Exchange for my IFISA. This is a P2P property investment platform that focuses on lower-risk properties (e.g. sheltered housing on long leases). I put an initial £100 into this in mid-February 2021 and another £400 in April. Everything went well, so in June 2021 I added another £500, bringing my total investment on the platform up to £1,000.

Since I opened my account, my Assetz Exchange portfolio has generated £44.26 in revenue from rental and £74.68 in capital growth, a total of £118.94. That’s a decent rate of return on my £1,000 investment and does illustrate the value of P2P property investment for diversifying your portfolio when equity markets are volatile.

I won’t bother publishing a statement on this occasion as it’s not hugely different from last time. The bottom line is that I (still) have investments in 21 different projects with them and all are performing as expected, generating income and – in every case now – showing a profit on capital. So I am very happy with how this investment has been doing.

To control risk with all my property crowdfunding investments nowadays, I invest relatively modest amounts in individual projects. This is a particular attraction of AE as far as i am concerned. You can actually invest from as little as 80p per property if you really want to proceed cautiously.

As mentioned, my investment on Assetz Exchange is in the form of an IFISA so there won’t be any tax to pay on profits, dividends or capital gains. I’ve been impressed by my experiences with Assetz Exchange and the returns generated so far, and intend to continue investing with them. You can read my full review of Assetz Exchange here. You can also sign up for an account on Assetz Exchange directly via this link [affiliate].

Another property platform I have investments with is Kuflink. They have been doing well recently, with new projects launching almost every day. I currently have over £2,100 invested with them, quite a large proportion of which comes from reinvested profits. To date I have never lost any money with Kuflink, though some loan terms have been extended once or twice. On the plus side, when this happens additional interest is paid for the period in question. At present all my Kuflink loans are performing to schedule.

Another of my Kuflink investments reached maturity in the last few weeks and I reinvested the capital released. You can see a screen capture of the new project below, a loan to convert some waste ground in the Stevenage district into a car park. It was a different sort of project from those I have previously invested in, but the case set out on the website seemed convincing.

My loans with Kuflink pay annual interest rates of 6 to 7.5 percent. As mentioned above, these days I invest no more than around £150 per loan (and often less). That is not because of any issues with Kuflink but more to do with losses of larger amounts on other P2P property platforms in the past. My days of putting four-figure sums into any single property investment are behind me now!

Nowadays I mainly opt to reinvest the monthly repayments I receive from Kuflink, which has the effect of boosting the percentage rate of return on the projects in question

You can read my full Kuflink review here. They offer a variety of investment options, including a tax-free IFISA paying up to 7% interest per year with built-in automatic diversification. Alternatively you can now build your own IFISA, with most loans on the platform (including the one shown above) being IFISA-eligible.

I’d also particularly draw your attention to Kuflink’s revised and more generous cashback offer for new investors [affiliate link]. They are now paying cashback on new investments from as little as £500 (it used to be £1,000). And if you are looking to invest larger amounts, you can earn up to a maximum of £4,000 in cashback. That is one of the best cashback offers I have seen anywhere (though admittedly you will need to invest £100,000 or more to receive that!).

I also recently published a blog post about another P2P property investment platform called BLEND. Like Kuflink, they offer the opportunity to invest in secured loans to experienced property developers. They offer (on average) somewhat higher rates of return than Kuflink, though arguably with a little more risk. As well as my blog post about BLEND, you can also check out what they have to offer on their website [affiliate link].

Moving on, I have another article on the always-excellent Mouthy Money website. This is quite a personal one in which I set out my views about the FIRE (Financial Independence, Retire Early) movement. For various reasons set out in the article I am not a fan of this. You can read my article here 🙂

I also recommend reading the article on Mouthy Money by my blogging colleague Finance Dee titled Panicked About the Stock Market? Why It Pays to Keep Calm and Carry On. Dee’s views very much reflect my own on this subject.

That’s more than enough for now, so I’ll sign off till next time. I hope you are keeping safe and well, and (if you live in England especially) are enjoying the more relaxed Covid restrictions that now apply. Here’s looking forward to a more normal spring and summer than the last two years. If you’re planning any UK short breaks, don’t forget I have a list of places I have visited and recommend here 🙂

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that this post includes affiliate links (disclosed). If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered.

If you enjoyed this post, please link to it on your own blog or social media:

February 3, 2022

Spotlight: Hargreaves Lansdown Investment Platform

Nick Investing reviews 6 Comments

Today I’m looking at Hargreaves Lansdown, an investment platform I have used on various occasions myself over the last few years.

HL describes itself as ‘the UK’s number 1 investment platform for private investors’ and it’s hard to argue with that. It is officially the largest stockbroker in the UK and listed on the FTSE 100.

At the start of 2022 the company had a staggering £135.5 billion of assets under administration (AUA) – considerably more than their two biggest rivals in the UK, AJ Bell YouInvest and Interactive Investor.

What Does HL Offer?

As you might expect for such a large company, Hargreaves Lansdown offers a wide range of accounts. These include:

Stocks and Shares ISA
Junior ISA
Lifetime ISA
SIPP (Self Invested Personal Pension)
Fund and Share account
Active Savings account
Cash ISA

Within their investment accounts, clients can select from a huge range of funds and individual company shares. HL have over 500 funds listed, including OEICs and unit trusts. You can also invest in thousands of individual company shares on the UK, US, European and Canadian markets.

What Are The Charges?

HL charges an annual platform fee of 0.45% for shares, ETFs and investment trusts.

For funds, the fee begins at 0.45% for the first £250,000, 0.25% for the next £750,000, and 0.1% for the next £1,000,000. There are no additional charges for any fund holdings over £2,000,000.

There are caps on maximum charges for different account types, e.g. a maximum £45 annual management charge on shares in a Stocks and Shares ISA. For more information about fees and charges, see the HL website.

Share dealing charges start at £11.95 per deal but reduce to as little as £5.95 based on the number of deals you made in the month before. This is set out in the table below.

Note that there is an added foreign exchange charge for overseas share deals, depending on deal size

Information and Advice

As well as dealing and portfolio management, Hargreaves Lansdown also offer investment information and advice.

For starters they have The Wealth Shortlist, a list of recommended funds researched and chosen by HL for their long-term potential. This can help investors narrow down their choice of funds from the vast number available on the platform.

HL also offer a service called Portfolio+. This is aimed at people who want to invest but prefer to leave the choice and management of investments to HL’s experts. You simply choose one of six ready-made portfolios that invest in a broad mix of assets across a range of countries and regions, giving lots of diversification (something regular readers will know I’m a big fan of).

Portfolio+ offers simplicity, performance potential and a low minimum investment of £1,000. Portfolios can be sold at any time free of charge (though of course they should only be bought as long-term investments). Once invested, portfolios are automatically rebalanced twice a year. No additional charges are levied for managing your portfolio. Not surprisingly, Portfolio+ is a popular choice among HL investors.

Personalized advice from professional financial advisers is also available via the HL platform. There is (of course) a charge for this, but the initial consultation is free. Again, see the HL website for more information.

For those brand new to investing, a very useful resource is HL’s Investing – As Easy As 1, 2, 3 page. This takes you through the basics of why, when and how to invest.

What Are the Pros and Cons of Hargreaves Lansdown?

Pros

Large, well-established platform with huge (over 1.5 million) client base
Wide range of accounts to meet all needs
Well-designed, user-friendly website
Mobile app also available
No dealing fees when buying or selling funds
Highly rated UK-based customer service team
Information, advice and ready-made portfolios available

Cons

Share dealing fees of up to £11.95 per deal are above average
Management charges for larger (over £50,000) portfolios are less competitive

What Do Users Think?

On the popular independent TrustPilot website, HL has an average rating of 4.2 (‘Great’) at the time of writing, with 55% of users awarding them a maximum five stars rating. That is on a par with the other leading UK investment platforms.

Positive comments emphasize the high-quality customer service, the well-designed website, and the range of investment products available. There are fewer negative comments, but some of these concern HL’s above-average charges for some services. There are also a few complaints regarding technical issues with the website.

Hargreaves Lansdown has also received various industry awards, including ‘Best Share Dealing Platform 2021’ (UK Investor Magazine) and ‘Best Digital ISA’ (Boring Money 2021 Best Buys).

Closing Thoughts

If you are planning to start investing (or switch from your current platform) Hargreaves Lansdown undoubtedly has a lot going for it. It’s a popular, well-established platform with a wide range of accounts and services on offer. Their charges are generally competitive, and (as I can testify myself) the UK-based customer service is first rate.

Their Portfolio+ service is an attractive option for novice investors – but equally, if you are happy to pick your own shares and funds, HL has all the info and tools you need.

If you are planning to regularly buy and sell individual shares, Hargreaves Lansdown is on the pricey side. In that case a low-cost share-dealing service such as eToro might be better for you. They offer commission-free trading on shares and charge no monthly account fee. That makes them ideal for short-term traders and investors looking to build a portfolio of shares cheaply. Of course, this is a much riskier approach to investing, and not recommended for those new to the field.

As ever, if you have any comments or questions about this blog post, please do leave them below.

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that this post includes affiliate links. If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered.

If you enjoyed this post, please link to it on your own blog or social media:

February 1, 2022

My Investments Update – February 2022

Nick Investing events, reviews, property, crowdfunding 2 Comments

Here is my latest monthly update about my investments. You can read my January 2022 Investments Update here if you like

I’ll begin as usual with my Nutmeg Stocks and Shares ISA, as I know many of you like to hear what is happening with this.

As the screenshot below shows, my main portfolio is currently valued at £20,870. Last month it stood at £22,275, so that is a fall of £1,405.

Apart from my main portfolio, I also have a second, smaller pot using Nutmeg’s Smart Alpha option. This is now worth £2,682 compared with £2,837 last month, a net fall of £155. Here is a screen capture showing performance over the last year.

There is no denying 2022 has got off to a disappointing start as far as these investments are concerned. Overall, they take the value of my portfolio back to where it was at the end of June 2021.

It is though worth noting that since I started investing with Nutmeg in 2016 I have still enjoyed a total return on my main portfolio of 45.8% (or 64.81% time-weighted). I should also mention that I have selected quite a high risk level for both my Nutmeg accounts (9/10 for the main one and 5/5 for Smart Alpha). This has served me well generally, but I’m sure investors who selected lower risk levels will have seen smaller falls this month.

Of course, it’s not just Nutmeg investors who have had a bad month. Equities generally have taken a tumble in the last few weeks. Commentators have varying opinions about this, but two reasons are typically mentioned: (1) the rising tensions (and threat of war) in Ukraine; and (2) rising inflation rates allied with the removal of monetary stimulus measures as we come out of the pandemic. Obviously nobody knows for sure which way things will go, but this recent post from the Nutmeg blog sets out some grounds for cautious optimism over the year ahead.

Personally I intend to take advantage of the current dip by topping up my Nutmeg investment while asset values are depressed. I plan to add to my Smart Alpha holding, as overall this has been doing slightly better than my main portfolio. I’m also conscious that the end of the 2021/22 tax year will soon be upon us. That means the end of the current year’s ISA allowance, so it really is a case of use it or lose it!

The above is just my view, of course, and should not be construed as personal financial advice for anyone else to follow.

You can read my full Nutmeg review here (including a special offer at the end for PAS readers). If you are still looking for a home for your 2021/22 ISA allowance, based on my experience over the last six years, they are certainly worth considering.

If you haven’t yet seen it, check out also my blog post in which I looked at the performance of Nutmeg fully managed portfolios at every risk level from 1 to 10 (as mentioned, my main port is level 9). I was actually pretty amazed by the difference the risk level you choose makes. If you are investing for the long term (and you almost certainly should be) opting for a hyper-cautious low-risk strategy may not be the smartest thing to do.

As regular readers will know, this year I am using Assetz Exchange for my IFISA. This is a P2P property investment platform that focuses on lower-risk properties (e.g. sheltered housing on long leases). I put an initial £100 into this in mid-February 2021 and another £400 in April. Everything went well, so in June 2021 I added another £500, bringing my total investment on the platform up to £1,000.

Since I opened my account, my Assetz Exchange portfolio has generated £37.18 in revenue from rental and £91.19 in capital growth, for a total return of £128.37. That’s an increase of £35.99 on last month alone, and does I guess illustrate the potential value of P2P property investment for diversifying your portfolio when equity markets are volatile.

I won’t bother publishing a statement on this occasion as it’s not massively different from last time. The bottom line is that I (still) have investments in 21 different projects with them and all are performing as expected, generating income and – in every case now – showing a profit on capital. So I am very happy with how this investment has been doing.

To control risk with all my property crowdfunding investments nowadays, I invest relatively modest amounts in individual projects. This is a particular attraction of AE as far as i am concerned. You can actually invest from as little as 80p per property if you really want to proceed cautiously.

As mentioned, my investment on Assetz Exchange is in the form of an IFISA so there won’t be any tax to pay on profits, dividends or capital gains. I’ve been impressed by my experiences with Assetz Exchange and the returns generated so far, and intend to continue investing with them. You can read my full review of Assetz Exchange here. You can also sign up for an account on Assetz Exchange directly via this link [affiliate].

Another property platform I have investments with is Kuflink. They have been doing well recently, with new projects launching almost every day. I currently have just over £2,000 invested with them, quite a large proportion of which comes from reinvested profits. To date I have never lost any money with Kuflink, though some loan terms have been extended once or twice. On the plus side, when this happens additional interest is paid for the period in question.

Several of my Kuflink investments reached maturity in the last few weeks and I reinvested the capital released. Here is one of the new projects I invested in, a loan to convert a disused medical centre in Five Ways, Birmingham into residential accommodation. It looked a solid investment, and I also liked the fact that it was redeveloping a derelict building in Birmingham, a city where I lived for around twenty years.

My loans with Kuflink pay annual interest rates of 6 to 7.5 percent. As mentioned above, these days I invest no more than around £150 per loan (and often less). That is not because of any issues with Kuflink but more to do with losses of larger amounts on other P2P property platforms in the past. My days of putting four-figure sums into any single property investment are behind me now!

Nowadays I mainly opt to reinvest the monthly repayments I receive from Kuflink, which has the effect of boosting the percentage rate of return on the projects in question

You can read my full Kuflink review here. They offer a variety of investment options, including a tax-free IFISA paying up to 7% interest per year with built-in automatic diversification. Alternatively you can now build your own IFISA, with most loans on the platform (including the one shown above) being IFISA-eligible.

I’d also particularly draw your attention to Kuflink’s revised and more generous cashback offer for new investors [affiliate link]. They are now paying cashback on new investments from as little as £500 (it used to be £1,000). And if you are looking to invest larger amounts, you can earn up to a maximum of £4,000 in cashback. That is one of the best cashback offers I have seen anywhere (though admittedly you will need to invest £100,000 or more to receive that!).

I also recently published a blog post about another P2P property investment platform called BLEND. Like Kuflink, they offer the opportunity to invest in secured loans to experienced property developers. They offer (on average) somewhat higher rates of return than Kuflink, though arguably with a little more risk. As well as my blog post about BLEND, you can also check out what they have to offer on their website [affiliate link].

Next up, I wanted to give another plug for an excellent low-key sideline-earning opportunity I have mentioned previously on Pounds and Sense. This opportunity is based on matched betting, a sideline I have pursued for several years myself. Several PAS readers (including my sister Annie!) have signed up for this and are now enjoying a tax-free, hassle-free sideline income from it 🙂

I have been asked not to divulge too many details about this publicly, for good reasons I will explain privately to anyone who may be interested (and no, it’s not illegal!). It doesn’t require any financial outlay and is risk-free and entirely hands-off (once you have set up your account). No knowledge of betting is required and you don’t have to place any bets yourself (this is all done by the company’s clever software). You just have to set up a separate bank account for bets to go through, but running the account is entirely financed by the company.

The company has changed its terms somewhat for new members. You now get a larger £100 initial reward payment once your account is up and running, and then £25 every month you remain a member. I think this is a good move personally, as setting up the account does involve a little work on your part (though it’s certainly not like going down the mines). So the £100 in effect compensates you for your time, and once it’s done you continue to get £25 a month for no effort at all.

The company is constantly developing its offering, partly in response to feedback from PAS readers. They recently launched a new mobile-friendly website to make it even easier for new members to sign up (once you’re up and running you shouldn’t need to use the website at all). They also recently incorporated an Open Banking app so that members don’t have to provide their online banking info to the company, as some people were concerned about this.

Please note that this opportunity is only open to honest, trustworthy people who haven’t done matched betting before and have no more than two accounts already with online bookmakers. For more information (and to receive a no-obligation invitation) drop me a line including your email address via my Contact Me page. And yes, I will receive a reward for introducing you, but this will not affect the service or the rewards you receive.

In the interests of full transparency, I should say that if you do matched betting yourself, you may be able to make more money than that being offered by the company. However, you will have to research the techniques in detail, place all bets yourself, and probably subscribe to a matched betting advisory service such as Profit Accumulator [affiliate link]. This opportunity is really for those who want an easy way to make some extra money without the hassle (or expense) of learning/applying matched-betting methods themselves.

Moving on, I have another article on the always-excellent Mouthy Money website. Coincidentally, this is about my experiences with P2P property investment over the last few years, both good and not-so-good. Do check it out! 🙂

I was also quoted by Jackie Annett of the Express newspaper in this article about working after retirement. It’s a short but interesting read, especially if you’re coming up to retirement (or already there) yourself.

That’s more than enough for now, so I’ll sign off till next time. I hope you are keeping safe and well, and (if you live in England especially) are enjoying the more relaxed Covid restrictions that now apply. Here’s hoping that normal life across the whole of the UK will be able to resume very soon!

Disclaimer: I am not a qualified financial adviser and nothing in this blog post should be construed as personal financial advice. Everyone should do their own ‘due diligence’ before investing and seek professional advice if in any doubt how best to proceed. All investing carries a risk of loss.

Note also that this post includes affiliate links (disclosed). If you click through and perform a qualifying transaction, I may receive a commission for introducing you. This will not affect the product or service you receive or the terms you are offered.

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January 21, 2022

Kuflink: My Review of this P2P Property Investment Platform

Nick Making Money, Saving Money, Investing reviews, property, crowdfunding 11 Comments

Today I am looking at P2P property investment platform Kuflink.

I have been investing with Kuflink for five years now, so this is a fully updated repost of my original review.

What is Kuflink?

Kuflink is an online platform offering opportunities to invest in loans secured against property. These loans are typically made to developers who require short- to medium-term bridging finance, e.g. to complete a major property renovation project, before refinancing with a commercial mortgage.

Kuflink offer three types of investment, as follows:

Select-Invest (individual loans)
Auto-Invest
Tax-free IFISA (Innovative Finance ISA)

Auto Invest and IFISAs both automatically invest your money across a number of loans and pay a fixed interest rate, typically between 7 and 9%. You can choose a 1-year, 2-year or 3-year term, and interest is paid annually (it is automatically reinvested at the end of each year with the two-year and three-year products). The Auto-Invest product is basically the same as the IFISA, but without the tax-free wrapper.

At one time only the Auto-Invest option was available for IFISAs, but nowadays you can choose your own investments if you prefer. The great majority of Self-Select loans on the Kuflink platform are IFISA-eligible. If you check out the Self-Select listings on the Kuflink website (see image below), this will tell you whether any particular loan is IFISA-eligible or not.

Individual Select-Invest loans pay interest rates varying between about 6 and 7.2%, depending largely on the LTV of the loan (loan to value, a measure of how secure the loan would be in the event of a default). The higher the LTV, the riskier the loan, and – other things being equal – the higher the interest rate paid in consequence. You can see a screen capture below of three Select-Invest loans available on the platform at the time of writing.

As a reasonably experienced P2P investor, I put my money into Select-Invest loans. These typically have a duration of six months to a year and (as mentioned above) pay interest from around 6 to 7.20 percent. That obviously isn’t as much as some P2P property platforms (e.g. BLEND), but I think it represents a fair balance between risk and reward. Kuflink also invest in every loan themselves up to 5% of the value of each loan – so, as the expression goes, they have skin in the game.

My Kuflink Review

I found signing up with Kuflink a quick and easy process. They do the obligatory money-laundering checks, but in my case anyway this was all done electronically behind the scenes. I uploaded a copy of my passport and was approved almost immediately. I started by depositing £500, but you can start with as little as £100 if you like.

Initially I put my money into a 12-month loan paying 7% annual interest. One good feature I didn’t grasp initially is that with Select-Invest loans interest is paid monthly. So once a month I receive interest payments on all the loans I am currently invested in. This is paid into a wallet, from which you can either withdraw to your bank account or reinvest.

Kuflink recently introduced an option to have monthly loan repayments automatically reinvested rather than paid into your account as cash. This effectively boosts your interest rate by the power of compounding, as you then receive interest on the reinvested payments as well. Currently this option is available for most, but not all, loans on the platform. You can see which of your loans compounding is available for via your Kuflink dashboard.

I have continued to invest in Kuflink, and have also reinvested in new loans when the original ones were paid off. Another good feature is that money invested in a loan but not yet released to the borrower attracts interest which is paid as cashback once the loan has gone live.

There have been no defaults so far on any of my loans, and Kuflink say on their website that to date nobody has lost a penny on their platform. I have experienced short delays with loans being repaid, but in such cases you continue to earn interest, of course.

Secondary Market

A new feature on Kuflink I like is the Marketplace (secondary market). Here you can buy loan parts from other investors who want to sell up early. You can also put up for sale any (or all) of your own loan parts.

The number of loan parts listed in the Marketplace went up in the early months of the pandemic, as many investors understandably wanted (or needed) to access their cash. This created short-term buying opportunities which I was happy to take advantage of. Loan parts offered via the Marketplace typically have only a few months to run, so you can expect to get your capital back quickly (and can then reinvest it if you wish). Only loans in good standing with monthly repayments up to date may be listed on the Marketplace, so that offers some reassurance against default – though of course it is by no means a guarantee.

In recent months the number of loan parts listed on the Marketplace has reduced considerably. And those that are tend to be snapped up quickly. As a would-be investor this is slightly disappointing, but it does indicate that people are keen to take advantage of the opportunities on offer. It also means that if you want (or need) to exit a loan early, accessing your money should be a quick and easy process.

Pros and Cons

Based on my experiences, here is my list of pros and cons for the Kuflink investment platform.

Pros

1. Easy sign-up process.

2. Low minimum investment.

3. All loans secured against property.

4. Choice of investments and approaches.

5. Manual and auto-invest options.

6. Kuflink invest in all loans themselves, so they have a strong incentive to ensure they are safe and secure.

7. They also cover the first 5% of losses on any loan before investors are affected (although this has never happened yet).

8. Money invested but not yet released to the borrower attracts interest which is paid as cashback once the loan has gone live.

9. In-depth information is provided on the website about all loans, so you can see exactly how your money will be used (and by whom).

10. There have been (according to Kuflink) no investor losses to date.

11. Customer service (in my experience anyway) is fast, friendly and helpful.

12. There is a 14-day cooling off period for new investors.

13. Marketplace (secondary market) for buying and selling loan parts.

14. No charges to investors lending on the primary market and only a 0.25% fee if you resell a loan part on the secondary market.

15. On most loans you can opt to reinvest monthly repayments to boost your net interest rate.

16. Tax-free IFISA option available.

Cons

1. Rates paid aren’t the highest in P2P lending.

2. Delays with some loans being repaid (although investors do earn extra interest if this happens).

3. No mobile app [UPDATE FEB 2023 – An app is now available.]

Conclusion

Overall, my experiences with Kuflink so far have been entirely positive and my investments have been generating the promised returns. I started cautiously with them, but have gradually built up the amount I have invested on the platform. Although – like all property P2P platforms – they were adversely affected by the pandemic, they appear to have come through it strongly, with new loans now being added almost daily.

As mentioned above, although Kuflink don’t pay the highest rates in P2P lending, I think the returns on offer are realistic and sustainable. The steady expansion of the platform seems to testify to this, as does the fact that they have received several industry awards. These include Best Alternative Business Funding Provider in the Business Moneyfacts Awards in both 2018 and 2019 and Best Service From an Alternative Funding Provider in 2020.

Kuflink are also highly rated on the independent TrustPilot website, with an average 4.6 out of 5 (‘Excellent’). At the time of writing 82% of reviewers award them the maximum five-star rating, which is among the highest figures I have seen for a financial services platform.

As with all P2P lending, your money does not enjoy the same level of protection as bank and building society accounts, which are covered (up to £85,000) by the Financial Services Compensation Scheme. Nonetheless, the rates of return on offer are significantly better than those from most financial institutions. And the fact that all loans are secured against bricks and mortar – and Kuflink themselves have cash invested in them – clearly offers some reassurance.

From my experience, Self-Select loans tend to fill up quickly. On the positive side, this shows investors have confidence in Kuflink and want to invest through the platform. On the minus side, it means there are typically no more than two or three new loans open for investment at any time.

Clearly, no-one should put all their spare cash into Kuflink (or any other P2P investment platform). Nonetheless, it is certainly worth considering as part of a diversified portfolio. Not only are the rates of return much higher than those offered by banks and building societies, they are relatively unaffected by ups and downs in the stock market. P2P loans aren’t a way of hedging your equity-based investments directly, but they do help spread the risk.

If you have any comments or questions about this review or Kuflink in general, as always, please do leave them below.

Disclosure: As stated above, I am an investor with Kuflink myself, and if you invest £500 or more via my link above I will receive a bonus for introducing you. Money is at risk. You should always do your own ‘due diligence’ before investing, and seek advice from a qualified financial adviser if in any doubt how best to proceed.

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