Your IndustryApr 27 2016

Nutmeg will offer ‘best advice that’s ever been seen’

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by
Nutmeg will offer ‘best advice that’s ever been seen’

Online investment manager Nutmeg’s founder has branded advisers “reactive” and limited to updating spreadsheets evey couple of years, as he hints at what the industry can expect from his company’s soon-to-launch advice service

Founded in 2011, Nutmeg was last month given permission by the Financial Conduct Authority to carry out regulated financial advice.

Speaking at the Westminster Business Forum conference yesterday (26 April), CEO Nick Hungerford admitted he was still not sure when this service would be launched.

But he said it will represent the “advice of tomorrow”.

“Advice today is reactive - you go and see your adviser and tell them what’s happened in the last two years and they update their spreadsheet and tell you what to do.

“The advice of tomorrow will be totally proactive. It will feed in the details of exactly what happens to you when it happens.

“We will deliver the best advice that’s ever been seen and we will do it proactively”.

Nutmeg’s advice service will seek to pre-empt the financial implications of clients’ life events, he said.

“We will say ‘you have just had a baby, why don’t you start a junior Isa today?’. That’s where advice is going and that’s what will serve the consumer.”

He added: “There are a variety of ways to learn more about what the customer needs and expects from wealth managers of the future.

“We’re looking at how to deliver the most personalised and relevant services to our customers exactly when they need them.”

Nutmeg’s current direct-to-consumer service allows people to open an Isa with £500 plus a £100 a month contributions for portfolios of less than £5,000.

Savers pay an annual management fee of between 0.3 per cent and 0.95 per cent including VAT, depending on the size of their investment.

Chris Hannant, the director general of Apfa, also spoke at the event and said he could foresee some aspect of advice operating in the way Hungerford described.

“There are traditional firms that are increasingly having technology embedded in their back office, so they will be a robo-advice firm in all but name, but will have a human face at the front end,” he said.

“I can see the back office will largely resemble what Nick is building, but you might see an adviser because some people value the human touch. I see this converging over time, with some of the plumbing looking very similar.”