Best investment platforms for beginners starting with as little as £1

Research, business and woman on computer in finance office for online report, taxes or audit. Night, review and banker typing on desktop in financial agency for equity, stock or investment growth Credit: Getty INVESTING can seem intimidating when you’re starting out, but the right platform makes it much easier. Whether you want to invest in individual shares, build a portfolio of funds or open a Stocks and Shares ISA, there are plenty of beginner-friendly options available. It’s important to choose a platform that is FCA regulated to stay protected from scams. But many of us don’t invest because we find it too complicated. The best investment platforms combine low fees, an easy-to-use app and plenty of educational tools to help you get started. Sign up for the Money newsletter Thank you! Here’s our pick of the best investment platforms for beginners in the UK. *Capital at risk. The value of your investments may go up or down. The best investment platforms Some of the best investment platforms that can help you start investing include: Lightyear Lightyear does most important things well – from offering a low-cost platform to a slick interface that doesn’t overwhelm beginner investors. It has a decent variety of investments too. From shares, managed portfolios, and even interest that follows the Bank of England’s base rate on uninvested cash. As you gain your investing confidence, you can tap into its library of deep, up-to-date research on individual shares. This can help you make informed investing decisions, from a quick overview of a company’s quarterly results to its dividend. One small downside is that Lightyear doesn’t offer a SIPP, and some commodities can’t be held in their stocks and shares ISA just yet. AJ Bell Dodl Owned by AJ Bell, Dodl is an app-only platform designed specifically for people who want a simplified approach to investing. It charges a 0.15% annual fee, or a minimum of £1 a month, but has no trading costs. Most people will pay £12 a year, and that represents great value for money. But, its list of investments is quite limited – mainly to the biggest companies in the US and UK. InvestEngine If you’re only interested in ETFs, a basket of investments that want to track an index, InvestEngine is an affordable option. For DIY investors, it is completely free—no platform fees and no dealing fees. They also offer a managed service for a low 0.25% fee where they do the hard work for you. It’s simple, transparent, and perfect for long-term “set and forget” investing, though you won’t be able to buy individual company shares like Apple or BP. JP Morgan Personal Investing Formerly known as Nutmeg, this platform is a great option if you’re looking for someone to manage your investments. When you sign up, you’ll be questioned on your financial goals and your investment timeframe. Then, it’ll suggest one of its investment funds that’s best suited to you and its team will look after your money from there. That means at no point will you be able to invest into a stock or fund of your choice. Since a team of professionals will be investing on your behalf, costs are naturally higher than other platforms. Opening and maintenance of your account has no fees but you will pay an annual percentage fee based on your invested portfolio value. But, if you don’t have the confidence to invest yourself, it can be a small price for peace of mind. Monzo Credit: Alamy If you already use Monzo for your daily spending, then investing with them can be a convenient option. You can start with as little as £1 and manage everything right next to your “Pots.” They charge an annual fee of 0.25% (or 0.20% if you have Monzo Plus, Premium, Perks or Max). Fees are built up daily and are collected once a month automatically from your investment account. Trading 212 If you are looking for a low-cost, hands-on way to manage your portfolio, Trading 212 is a popular choice. You can start investing with £1 in thousands of global stocks and ETFs. It offers fractional shares, which means you can invest in companies like Apple or Amazon with just a few pounds. They do not charge a platform fee and continue to offer commission-free investing for everyone. What is an investment platform? An investment platform allows you to buy, sell, and view all your investments in a single space. The type and variety of investments depend on your chosen platform. Some, like eToro, allow you to invest in stocks, funds, currencies, and other assets. Meanwhile InvestEngine keeps its suite more niche – only offering exchange traded funds (ETF). These are the types of investments that may be available to you: Shares – Also known as a stock, represents a slice of ownership in a company. You acn buy shares in UK companies like Shell or Astra Zenica, as well as international companies like Apple in the US or Toyota in Japan Funds – If you’re looking to spread your risk across your portfolio, then a fund could be an option. Funds pool money from multiple investors to buy a mix of assets, making it easier and cheaper to diversify your investments. ETFs and investment trusts are common types of funds Commodities – A commodity is a natural resource like gold or oil. On most investing platforms, you can invest in commodities using a fund rather than buying the physical item. Currencies – Currency (or Forex) trading involves buying and selling different currencies to profit from exchange rate changes. It carries high risk, and most beginner investors lose money doing it. Bonds – A bond is a fixed income, where an organisation will borrow money and repay their debt, plus interest, over a certain period. Governments and companies both issue bonds, and once again investors can gain exposure to this market on an investing app through a fund Remember to use your tax-free allowance first When choosing an investment platform, consider one that has a stocks and shares ISA or a self-invested pension plan (SIPP). That’s because these accounts come with important tax advantages. A stocks and shares ISA protects your investments from dividends and capital gains tax while a SIPP comes with tax relief on your contributions. Can someone manage my investments for me? You don’t need to make and manage all your investments on some of these platforms. Many platforms know that some customers prefer to let experts handle their money, and that’s why they offer ready-made funds. These are pooled investments where someone actively manages your money according to your risk tolerance. Ultimately, the best portfolio for you depends on your personal goals and how long you plan to invest—riskier funds usually suggest a longer investment horizon. What makes a good investment platform? There are a few features that make a good investment platform, but the importance of each will vary by person. Someone looking to invest a small sum with limited investing knowledge may prioritise a provider with an easy-to-use app and a range of competitively priced ready-made portfolios. Meanwhile, someone who has a large deposit might look for the platform that offers the best fees on high balances. There are, however, some features which all types of investors think will make a good investment app – and good security features are one example. All platforms you compare should also be regulated by the Financial Conduct Authority (FCA) too. Choosing an FCA-regulated provider means it must meet strict UK regulatory standards. Cash and assets held with authorized firms may be protected by the Financial Services Compensation Scheme (FSCS) up to standard limits if the provider fails. However, FSCS protection does not cover losses caused by poor investment performance, and your capital remains at risk. What do I need to open a trading platform in the UK? To start trading stocks, EFTs, or forex on an established UK platform, you will needL: UK Residency and you must be at least 18 year old Proof of identity (UK driving licence or passport) Proof of address e.g. a recent bank statement or utility bill National insurance number UK bank accounts Complete online identity and risk check READ MORE ABOUT INVESTING How to choose an investment platform? Clare Francis, director of savings and investments at Barclays Smart Investor, said while platforms are broadly the same there are some differentiating factors to consider when looking for the right platform. Finding a provider with decent fees is perhaps on the minds of most investors, and she said this will depend on the amount you’re looking to deposit and where it will be invested. “It’s not all about cost though, other features could also be of value to you,” Francis said. Educational tools is one example she listed, and something Manuel Pardavila-Gonzalez, investments managing director at Lloyds banking group noted too. “It’s vital new investors choose a platform that has educational support to guide them through their investment journey,” he said. Striking the balance between saving and investing Just because you’ve opened an investment account it doesn’t mean you need to empty your cash savings. Cash provides a guarantee – which can be useful in times of uncertainty. “Striking the right balance between cash savings and investments depends on your personal circumstances and financial priorities,” said Francis. She said get three to six months of emergency built up, then consider your other goals. So let savings be the bedrock of your pot “Once you’ve got your savings in place, it’s time to consider investing as it offers the potential to achieve better returns over the longer term,” she said. Regular contributions to both your savings and investments is one practical tip Francis shared to grow your wealth. “Make it part of your routine by setting up monthly direct debits, and review your financial set-up at least once a year,” she said. Comment now