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There are many investing apps on the market. I’ve tried many of them over the last few years and have been meaning to write this Freetrade review for a while. I first tried them out a couple of years ago when they first launched. The draw was their free shares for signing up system, but since then I’ve learnt that they are much more than freebie.
Choosing the right investing platform for you can be hard. But in reality, you don’t have to pick one and stick with it forever. Even if you choose to open an ISA, you’ll still have options if you want to switch later.
But if you are brand new to investing this can be a much bigger decision. You don’t want to do some wrong and mess things up. You want it nice and simple while you learn how the stock market works, and flex your investing muscles.
Now if you can’t bothered to read this article, then you are in luck. I have made of video of this review. Check it out.
Note: the information on this page or in the video above is not financial advice. It is here for educational purposes. Remember when investing that your money can go down as well as up, so make sure you understand the risks before you start.
What types of accounts to Freetrade offer?
This is a good starting point. Your choice of account will impact on the fees you pay, the range of assets that available to you, the tax you will pay, and the potential benefits that you will receive.
Freetrade offer three main account types: a general investment account, a stocks and shares ISA, and a self-invested personal pension.
In addition to this there is the opportunity to upgrade your account to Freetrade Plus. This includes a stocks & shares ISA (but is not obligatory), gives you access to 3% interest on cash of up to £4,000, limit orders, stop losses, and access to a greater range of stocks. If you are new to investing, I would say that this is not something that you would need to consider at least in the beginning.
A review of Freetrade’s fees
Let’s start with how much it costs to use this app. When it comes to investing the fees are important. This can potentially corrode your returns and it is for those returns that we even start investing in the first place.
As the name suggests Freetrade offers commission free trading. This means that they don’t charge you to buy or sell on their platform. Other platforms can charge up to £12 per transaction so this could effectively save you a lot of money. However, there are a growing number of platforms that offer this service, at least for a certain number of trades.
Other fees to consider are account fees. Now this will depend on the type of account you choose. The fees work out like this:
With the basic account:
- GIA – free
- Stocks & shares ISA – £3/month
- SIPP – £9.99/month
With Freetrade Plus at £9.99/month:
- GIA – included plus additional benefits mentioned above
- S&S ISA – included
- SIPP – £7/month
What types of assets are available on Freetrade?
Rather than me listing them, here is a screenshot from the Freetrade website:
For the average beginner investor, the basic package should give more than enough options to get started. If you want access to some of the stocks available on Freetrade Plus, then you’ll need to weigh up the costs. There are other similar apps out their that offer these without the monthly fee.
How to sign up for Freetrade?
THe first thing you need to do to click this link. This will take you to the sign up page and make sure that you get your free share. The majority of the process is self-explanatory and for a full rundown of the process, I recommend that you watch the video above.
To summarise though, the process goes like this:
- Enter your email address – this will then generate a magic link that will validate your email address and take you back to the app.
- Choose a passcode – this is used for signing back into the app and at later date. You can also turn on FaceID if you wish.
- Enter your personal details – this will include your legal name, address and National Insurance number. Your NI number is used to confirm your tax status.
- Choose an account type – select which one of the accounts that they offer that you would like to open.
- Complete a US tax exemption form (W-8BEN) – this is say that you don’t pay tax in the US. All investing platforms will ask for this if they offer US stocks.
- Top-up your account – this is where you can add some money to your account. You can start with just £1.
- Get your free share – this is the final step. It can take 7-10 days for your free share to come through.
What does the Freetrade app look like?
Once you are signed up, the app itself is nicely laid out and super easy to use. There aren’t a whole load of different options and they present the information you need in a simple way. Here are a few screenshots from inside the app:
As you can see, you get clear information about your portfolio, including the stocks and ETFs you are holding, their value, how your portfolio is split and the transactions you have made within your account. There are other pages such as discover, which is where you can search for stocks and the account tab for topping up and withdrawing money.
The process of purchasing stocks is really easy. You first need to ensure that there is money in your account. You can do this by going to the Account tab and selecting top-up. If you linked your bank account when you signed up, then your details will already be there to make it easier.
Then you need to head to the Discover tab and search for the stock or ETF you want to invest in. There is a search bar at the top if you know the name of the company or fund. Alternatively, you can scroll through to look at the options on this tab.
Once you know what you want to buy you can enter how much you want to buy. It will convert this into how much shares you will get. As you can see in the example above, it shows me that I will get 0.0179 shares in Tesla for the price of £10. (Also this is not a stock recommendation. Just an example.)
My Freetrade review summary
All in all I like this app. It is inituitive, nicely laid out and offers a good range of features and options without being overwhelming. I think that it is a great place to start for beginners, particularly with the free share and low minimum deposit of £1. It means that you can start small, or use the money from the free share to play around with investing.
If you do decide that you want to invest more regularly, the stocks and shares ISA offers a tax-free way to invest for the long term. I would urge you to consider whether the monthly is worth it however if you are only investing small amounts. This could very quickly corrode your profits and potentially your capital. There are other potentially cheaper investment platforms out there.
Don’t forget to sign up using my link to get your free share. Once you are signed up, you get your own free shares link to send to your friends too.