Nutmeg or Premium Bonds

[DaisyDaisyDaisyDaisyDaisyDaisy]

Hello Mumsnet. Can anyone advise on this as I'm a bit clueless! A few years ago I bought £10,000 of shares on Nutmeg. They have never made money. In fact they are generally between £300-500 down. Should I cut my losses and put the money into premium bonds? Or an ISA? Do you think I'll ever make a profit if I leave the money where it is?

What shares are they? Do they pay a dividend?

Are the shares not in an ISA?

The money is split between 2 pots. One medium risk one high.

Funds rather than individual shares, then? Either way you'd be better putting them in an ISA - whether kept as share funds or changed to cash - than in a GIA.

Share are currently rising, while the prize fund for premium bods has just been cut, so that would be a poorly timed move. And a big change in risk level.

Op you picked the wrong funds. Even in a downturn my funds have been coasting at roughly 20%. My whole pot is up 64 % now over about 6 ish years.

Whaaat?? Oh no!! I don't know if I'm making sense but I believe nutmeg picked them for me. Do I quit now before I lose even more?

It’s hard to answer without knowing what you’ve invested in but for an example Nutmeg fully managed performance is here. If you bought at the beginning of 2022 you won’t have made much but that’s not Nutmeg, that’s everything. For shares you really need to be thinking of at least 5 years as a timeline, absolute minimum, and within that there will be ups and downs. Look at the Nutmeg high risk on the link- if you’d bought in 2016 you’d be up about 70% so similar returns to PP.

Do you have a reasonable amount of cash savings? If so, I’d leave your shares as they are (but check they are in an isa) and stop looking at them for a few years. It’s a long game.

You should also check exactly what funds you are in and when you invested.

https://www.nutmeg.com/fully-managed-portfolios?utm_source=Google&utm_medium=CPC&utm_campaign=%5BBrand+Extended%5D+%5Bcou%3A+GB%5D+%5Btgt%3A+Brand%5D+%5Bplt%3A+GOO%5D+%5Bstr%3A+PROSP%5D+%5Bcty%3A+All%5D+%5BIng%3A+EN%5D+%5Bmtc%3A+BMM%5D+%5Bnet%3A+SMART%5D&gad_source=1&gbraid=0AAAAADzSuxX1-26IAAKupm0i_JV4u_MT-&gclid=CjwKCAiA2pyuBhBKEiwApLaIO-CSnCpOkoDaXRtWmGXLIugIfiAU97ELDN2dw8WHJAuLZISQe7YANRoCxPUQAvD_BwE&gclsrc=aw.ds

@SpraggleWaggle thank you so much. At the time (2020) I remember reading you should only invest what you can afford to lose. At the time I could afford to but things have changed over the last 3/4 years. I invested 10k but set up a dd to keep topping it up, so the now £13k has a -300 dividend. I'm really tempted to wait til it reaches 0 loss and put the £13k somewhere else, although your advice to stick it out for the long haul also makes complete sense. I will spend a few hours today checking out the link you very kindly posted and delve deeper into what I'm actually invested in.

Daisy, read up about index funds etc then chose yourself.

I have. I'm just not money minded I guess.

I’m in nutmeg and about 15% up over the last two years. That’s in the highest risk category though.

You’re investing in the stock market, although Nutmeg is picking the investments for you. As someone said, you need to have a timeframe of at least 5 years to average out some of the volatility. It may be just that you invested at a bit of a high.

5% down looks scary if you need the money now, but it’s well within the ebb and flow of the market. Hang in there.

Hmm thanks @evilkitten . Funnily enough the pot in the high risk category has made money but it's the majority in the medium risk that's lost it. Thank you for the encouragement.

Martin Lewis was talking about investing in ISAs just recently, I believe there is something on instagram about it

ISAs are just a tax wrapper and if you don’t have these nutmeg shares in a tax wrapper you’re missing out. Regardless if how well they’re doing. If they are in a ISA (tax wrapper) when you withdraw your shares you won’t pay any tax. I suggest you open an ISA and transfer (transfer do not sell & buy) these nutmeg shares into a tax wrapper. The limit is 20k so your 13k is fine. You can probs stay with nutmeg if their fees are ok. I’m assuming they offer ISAs and these same funds within an ISA wrapper.

Over 3 years of premium bonds i've found it to work out at about 1.5% to 1.7% however that range change change one moth by winning a couple of prizes. i would first look at ISA and then premium bonds.

My nutmeg account was down for a couple of years. Nothing to do with nutmeg, just a dodgy market and a high risk account. It's been back up around 10% in the last few months.

Thanks @flatmop and @JBirch . I've actually withdrawn the ( much) smaller pot and will put the money into an isa for now I think. The much larger pot has performed terribly the entire time but I'm leaving it for now until I at least break even. I'm not really in a position to hang around for years on end to get anything from it. I regret investing at all now but times were different then and hindsight is a wonderful thing.

Mine was down for a bit too, now it's up. I would say nutmeg over premium bonds if you are investing for the long(ish) term

Investing is a long term project - anything under 5 years, ideally 10, you're best sticking to cash.

But you really need to get your head around what.you are investing/saving in.

Nutmeg is a company. You can hold many types of wrappers and investments within it.

And ISA is a wrapper. You can hold different types of investments within it. Or cash. And you can get one from many different companies.

So 'nutmeg or an isa' is not really an answerable question. To put it into alternative terms, it's roughly like asking whether you should go to Tesco or buy tins. When what you actually need to decide is what you want for dinner, and then look for the best place to buy the specific ingredients.

If you want short term, non-volatile, then a cash ISA is probably the way to go. You can get some paying 4% to 5% at the moment - depending whether you went flexible or fixed term (and if the latter, how long a fix).

Thanks @NoBinturongsHereMate for your input and I get where you're coming from. I guess I just didn't think about the long term -ness of an investment in a nutmeg type of company. I think a cash isa is definitely the way to go and am following another thread on here asking how the OP should invest £10k which has been really informative. Maybe that's what I should have done when I first had this money to play with!!

When in 2020 did you put your money into Nutmeg? I'm assuming it is already in a stocks and shares isa rather than in a general investment account. The pandemic had an awful effect on stocks and shares. If you were unlucky you put your money in just before March 2020 and then would have had a shock as you watched the value plummet.

I have a Nutmeg S&S ISA, risk level 4, opened in 2018 when I was a total beginner at investing. I basically drip fed it 16k that tax year and haven't touched it since. I watched it grow then fall over the pandemic and now it's gone back up quite a lot in the past 6 months or so. Value is now just over £21,600, so a time-weighted return of 32.8% which isn't bad at all. At one point the return level was a VERY low percentage indeed and during the pandemic the value was below what I put in. But I knew it would recover eventually so just left it.

There are some world events you can't plan for. I gave DS £1000 to put in to a Vanguard S&S Isa when he was 18 to start him off. That was Jan 2022. Right before Putin invaded Ukraine. It was just bad luck, that timing. He has left it and it's slowly recovered.

You don't invest in the stockmarket if you're going to need the money within 5 years. It's a long-term thing. And you shouldn't panic and withdraw everything if there's a big drop for reasons like pandemics and wars. You wait. You should only take funds out if you think they are underperforming compared with other funds operating under the same global conditions.

Hello @CurlyhairedAssassin and thanks for your response. I'm actually wrong about the date. I opened the account with Nutmeg in June 21. Yes it's stocks and shares. I thought at the time it would be fine to leave the money in for the long haul but a lot has changed for me since then.
Really appreciate everyone's responses and helpful advice here

I transferred a stocks and shares ISA from Investec (they stopped doing them) to Nutmeg in 6/19 - value just over £25k and I chose a medium risk pot for 10 year growth: 3/20 just under £17k (covid, I know), 9/21 £25k, 9/21 just over £21k, 9/22 just over £21k, 10/23 just under £22k. I've just cashed it in and split it between my two children! Good luck!

Hi @Lifestooshort71 . So you initially invested over £25k and got just under £22k back?

Yes, give or take. On reflection I should have changed it to high risk but it never really recovered from the covid downturn and the cost of living, etc, etc.

OP, a year ago I looked into investing for the first time. I listened to Meaningful Money podcasts and read some Mumsnet and Reddit threads.

Someone recommended this book. I bought a second-hand copy on Vinted. It was an absolute game-changer and I'd recommend anyone interested in investing and building wealth to read it:

https://www.amazon.co.uk/Simple-Path-Wealth-financial-independence/dp/1737724103/ref=asc_df_1737724103/?tag=googshopuk-21&linkCode=df0&hvadid=535116224368&hvpos=&hvnetw=g&hvrand=4656189047271639268&hvpone=&hvptwo=&hvqmt=&hvdev=m&hvdvcmdl=&hvlocint=&hvlocphy=1007012&hvtargid=pla-1411526394398&psc=1&mcid=e5fb32b2bdbd37d48d0e651a6120b427&th=1&psc=1

I now have an ISA and a SIPP using a low-cost platform (Vanguard) with a global multi-asset index fund (Vanguard Developed World Ex UK) and have seen gains of 10+% this year, with the usual stock market ups and downs.

I had no idea about any of this a year ago. Literally zero.

All you need is a cheap platform and a highly diversified fund with low fees. The book explains it all.

You absolutely don't need to be "money-minded" to make money from investing Honestly, anyone can do it.

All the best.