All our portfolios have a small amount of cash. The cash is used to pay the management fee without needing to sell investments to do so. Cash can also play a part in a diversified portfolio
Any cash within your Nutmeg account earns interest at the current Bank of England (BOE) bank rate minus 0.35%. We will provide notice of any changes to the interest rate .
If the BOE bank rate is below 0.35%, you won't receive any interest. Please note, at Nutmeg we will not allow your interest rate to fall below 0% and take any of your cash, even if the BOE bank rate is below 0.35%.
Cash pots within your genera investment account and ISA wrapper
At Nutmeg, you have the option to create a pot that is 100% allocated to cash within a General Investment Account (GIA) or stocks and shares ISA wrapper. This option is not currently available for a Junior ISA (JISA) or Lifetime ISA (LISA).
You can choose to hold a cash pot within your investment product if you don’t want these funds to be exposed to the risk associated with investing. A cash pot is not a cash ISA and isn’t intended to be used for long-term savings – think of it as a waiting room for your cash before it gets invested.
If you decide on a cash pot, you can create one and put money into it from your Nutmeg desktop dashboard. You can then set up a regular monthly transfer into an investment pot to drip-feed your cash through to the markets.
The drip-feeding feature taps into an investing principle known as pound cost averaging. By contributing smaller amounts on a regular basis, you buy into the markets during the various ups-and-downs, meaning you’re less exposed to short-term market movements.
There are no fees charged on cash pots.
If you have more than one pot with Nutmeg and make a bank transfer, we can’t be sure which pot you’d most like to allocate the money to. If a payment cannot be allocated to a cash or investment pot for this reason it will be held as “Unallocated Cash”.
In which case, we’ll contact you, in most cases, by Nutmail, that way you can decide how you want to distribute the money. Once you've assigned the cash to a pot we'll invest it on our next twice-weekly investment cycle.
If you have only one pot with Nutmeg and you wish to make a bank transfer, you don’t need to do anything. We will simply allocate the money to that pot. .
Why can I see a lot of cash displayed in my dashboard?
If you see an unusually large amount of cash displayed beside your pot , and it isn’t because you’re holding it in a cash pot, the most likely reason is that a payment has recently arrived and the money has not yet been invested through our twice-weekly investing cycle.