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If you’ve spent any time trading via apps in the UK, you’ll already know you’re spoilt for choice. Here at Project Financially Free, we’ve reviewed lots of different platforms and apps, and have even pitched a few against each other! However, Lightyear has recently popped up as a trading platform that seems to be turning a few heads online.
Emerging as a new take on affordable, simple, and transparent trading, Lightyear is already raising eyebrows as a potential challenger against some of the bigger names in UK trading. But how does it measure up when it comes to products, customer service, and ease of use?
In this Lightyear investing review, I’ll take you through the vital statistics you need to know about the investment platform and whether or not it’s worth your time and money.
What is Lightyear?
Lightyear is an investment platform created with impressive plaudits in the trading industry. Martin Sokk and Mihkel Aamer, the main duo behind the brand, left international transfer giant Wise to create an investment machine without borders.
In fact, the Lightyear team benefits from knowledge gained through working at the likes of Robinhood and Revolut, too.
Lightyear’s main focus is transparent pricing that’s affordable for all. The team designed its platform to provide access to anyone looking to explore the markets for the first time.
Lightyear also advises new traders that they care about them making the most out of their money – whether that’s through interest on uninvested cash or providing low fees as standard.
With a 4.8 out of 5 rating on Trustpilot at the time of writing, Lightyear’s simple, low-fee approach to investing is winning fans across the UK. But, as always, it’s worth digging into what makes this platform such a winner.
Is Lightyear good for beginners?
As mentioned, Lightyear’s platform is built with accessibility in mind, so, yes – it’s great for beginners. While it’s not a robo-advisor platform with a “hands-off” mentality like Nutmeg, Lightyear prevails with a simple investment setup that gives you complete control.
Setting up a Lightyear account is refreshingly simple. There’s no need to muddle around with physical documents, and there’s no minimum deposit required to get access to the platform.. That breaks down a lot of barriers for people who are just starting out with only a small amount to invest with.
Is it easy to open an account with Lightyear?
Opening an account with Lightyear is certainly quick and simple compared to some of its industry competitors.
To get fully verified at Lightyear, you’ll need to provide proof of a few documents to assure them of your UK address and citizenship status. To do this, you’ll typically need to provide evidence of a driving licence or a passport – provided there’s a photo, you’re good to go.
To verify your address, Lightyear will also need a utility bill, a government document, or a bank statement. You can upload these documents through the Lightyear app, which is assuredly secure – your data is in safe hands.
What can you trade with Lightyear?
Lightyear lets you invest in:
- UK stocks
- US stocks
- EU stocks
- Money market funds (limited to specific regions)
One of the most interesting features at Lightyear is that it provides access to over 3,500 different international stocks and ETFs, with over 200 stocks based in the UK alone.
There are no savings account options available through Lightyear, however, the service does provide business accounts for use in both the UK and Estonia, provided you’re either a sole trader / director or a freelancer.
Some fees apply to business use through Lightyear, which I explore a little further down.
Lightyear deposits and withdrawals
It’s always free to withdraw with Lightyear, however, you can only withdraw via bank transfer. Thankfully, you can use cards and e-wallets to pay into your account, with a 0.5% fee that applies to fast transfers once you’ve exceeded a lifetime limit of £500. Apple Pay and Google Pay are included, too.
It’s always free to deposit via bank transfer with Lightyear, and you can hold multiple currencies in the same account at any one time. At present, you can trade in USD, GBP, and EUR, which is reasonably competitive.
What’s the benefit of using a multi-currency account?
Lightyear’s team takes a leaf out of their Wise experience here, as their multi-currency account makes it easy to move funds around without having to convert and pay fees when you want to invest in a foreign instrument.
Lightyear’s multi-currency account allows to hold balances in sterling, euros and US dollars at the same time. You choose when to convert, and it’s always at the live rate with a flat 0.35% fee.
How much does Lightyear cost?
You can exchange ETFs for free through Lightyear, and you won’t have to pay for custody of your securities or simply to hold a multi-currency account.
There are very few areas where you’ll expect to pay through Lightyear, and their stock fees are competitively low.
You’ll need to pay certain government and legal fees, for example, a 0.5% stamp duty fee will always apply, and there’s a French Financial Transaction Tax of 0.3% should you specifically want to buy French stocks.
Lightyear also warns users that there’s a LEI fee of £40 plus VAT for the year if you want to start investing as a business, and you’ll need to pay a fixed fee of $4.14 for each USD wire payment received. This fee is representative at the time of writing.
When trading in UK shares via Lightyear, you’ll only ever pay £1 per order. Similarly, there’s a flat charge of €1 per order if you want to trade in EUR orders, and a maximum of $1 for each US share order.
However, you’ll be charged 0.1% as standard on US transactions, meaning there’s a chance you’ll pay less than a dollar.
If you do want to convert currency through Lightyear, there’s a representative rate of 0.35%, which is based on live interbank rates.
If you invest in money market funds, you’ll pay an annual rate based on your contributions. If you invest less than one million in your chosen currency, you’ll pay 0.30%. Invest up to 25 million, and this falls to 0.20%, with the rate falling even further to 0.09% if you invest beyond that point.
These fees are highly competitive – and one of the main reasons Lightyear is getting so much press.
What’s more, there will never be any fees applied if your account goes inactive.
How do I make money with interest through Lightyear?
Lightyear’s interest on uninvested cash is one of its biggest selling points. Unlike some trading platforms, Lightyear passes much of the money it makes in interest from holding customer money onto its users.
The amount you could accrue from uninvested money depends on the current per annum interest rate, and Lightyear takes a cut of 0.75% from the amount in question. It’s wise to look into current UK interest rates before you start calculating how much money you could make.
Interest income through Lightyear starts accruing the day you make your first deposit into your account. It’s calculated daily based on the uninvested cash you have available, when Lightyear then rounds these unpaid amounts to two decimal places.
Keep in mind, however, that you’ll be responsible for paying any applicable taxes, and any money you set aside for orders or other executions through Lightyear won’t make interest. The company also warns that if you shut down your Lightyear account before your interest is next due, you won’t receive a payment.
Lightyear web and mobile platforms
Lightyear offers web and mobile services, both of which are very easy to get to grips with and start trading through. I personally recommend using the Lightyear app if you have a choice, but the web version is, in itself, competitively easy to manage.
At the time of publication, there’s no desktop version available for Lightyear.
Lightyear customer support
Lightyear offers a fantastic help guide that answered the majority of my questions before I needed to reach out to the team.
What I do think is missing from Lightyear right now is a live chat function, if not a dedicated number people can call if they’d like to speak to an advisor. Right now, there’s email support available once logged-in.
Is Lightyear worth investing with?
Lightyear might be one of the newer names in UK investing apps, but it’s got a lot of industry clout behind it. With refreshingly low fees and a highly accessible trading platform, I think it’s well worth a look if you’re keen to get started but have little experience with investing money.
This is a service that’s only going to expand over time, so my advice would be to check it out in your own time and use it carefully.
by Jon Craig
I am the creator of Project Financially Free and I started this journey to both educate myself and share my insights on personal finance. I’m passionate about financial literacy and I invite you to join me on this transformative path. See more.
Capital at risk. The provider of investment services is Lightyear Financial Ltd for the UK and Lightyear Europe AS for the EU. Terms apply: lightyear.com/terms. Seek qualified advice if necessary.”
Lightyear Financial Ltd is an appointed representative of RiskSave Technologies Ltd, which is authorised and regulated by the Financial Conduct Authority.