Plum Review – Is ‘AI’ the best way to save and invest?

15 min Read Published: 14 May 2020

Plum review - Is AI the best way to save and invest?

Building up a savings pot and putting away a regular amount each month is something that most Britons find difficult and this is proven by the fact that almost 50% of the UK has savings of less than £1,500. Living standards have been hit in recent years due to weak wage growth and rising prices, making the difficult task of saving money even harder.

There are many ways to start saving and investing, but what is the best way and how can you get started?

What is Plum and how does it work?

Plum is a savings and investment 'robot' for your phone that analyses your spending and automatically saves your money for you, so you don't have to. Plum decided to make saving money seem less of a chore and easier by allowing us to spend on 'things we want, rather than things we need.'

Plum was founded by Victor and Alex, two Cypriots living and working in the UK, who decided to challenge each other to save. This, in turn, resulted in Alex coming up with an algorithm that monitored his spending, putting aside the amount he could afford to save each month. This process allowed him to automate the savings process without having to alter his spending habits.

Plum works by linking to your bank account (it supports all major UK banks) and analyses your spending and transactions to work out the best amount to put away every few days. You determine how much you want Plum to save and can ask it to stop saving at any time. Plum can be used via an iOS and Android app, as well as via Facebook Messenger.

To sign up to Plum you need to be a UK resident and have a UK current bank account. Interestingly, despite Plum using Facebook Messenger to communicate, you do not need a Facebook account to sign up to Plum.

With Plum not only do you have the opportunity to build up a savings pot, but you can also invest your savings for a small monthly fee.

Plum features - should you save or invest with Plum?

Saving with Plum

  • Save automatically
  • Adjust how much you want to save by setting moods
  • Withdraw money at any time
  • Show your friends how Plum works with 'Privacy mode'


Plum helps you to save by using its algorithm and artificial intelligence to analyse your spending to save you money automatically. You can decide how much money you save with Plum based on the moods shown in the image below as per Plum's website (the standard saving setting for Plum is 'Normal'):

Plum saving moods







You can change your mood in the app via the home page or by typing 'mood' in your messenger. If you want to withdraw money from your Plum account you can do so via the app or by typing withdraw in the messenger app. If you request to withdraw money it should be in your bank account within 30 minutes. If you wish to withdraw over £250 you will need to provide a photo of your passport for 'Know Your Customer' requirements.

Where are my savings kept?

The money that you save with Plum is currently kept in a virtual bank account with Payrnet which is described as an 'Authorised Electronic Money provider' on Plum's site.

Can I earn interest on my savings?

No, Plum doesn't allow you to earn interest on your savings but you can instead opt to invest your Plum savings.

Investing with Plum

  • Invest with as little as £1
  • Pick what you want to invest in
  • Pick your investment risk level
  • Withdraw money within 5-7 working days
  • Investing is part of PlumPlus which costs £1 a month* (free for the first month)

*plus additional management fees

You can invest in both a Stocks and Shares ISA and a General Investment account with Plum. You can choose to invest in just shares or a mixture of shares and bonds. If you choose to invest in shares and bonds you can choose between 3 levels of risk:

  • Slow & Steady - Lowest risk level
  • Balanced bundle - Medium risk level
  • Growth stack - HIghest risk level

Remember: You can hold as many stocks and shares ISAs as you like across multiple providers, however, you can only contribute the current tax-year allowance into one stocks and shares ISA with one provider and so make sure you check before you commit to a PlumISA

Should I invest with Plum?

It is important to remember that any type of investing comes with a certain level of risk meaning it is possible to get back less than you put in.

If you invest in tech and growth funds with Plum your money is held in an investment account with Gaudi Regulated Services LTD, which is FCA regulated.

How much does Plum cost to save?

Saving with Plum is free and so is signing up to Plum and downloading the app. There is now the option to save more with Plum Pro which is a subscription service, find out more here.

How much does Plum cost to invest?

The cost of investing with Plum is outlined below:

  • Monthly fee £1
  • Fund Management Fees (0.15% for funds)
  • Fund Fees (0.08% - 0.90% for funds)

The monthly fee charged by Plum will be taken from your account via direct debit each month and the first month is free.

The management fees are 0.15% of the value of the fund, charged monthly (or pro-rata if a fund is closed). Fund fees are charged by the fund providers for providing the service of creating a fund. These fees are not reflected as a cost in the statements you receive, the funds are simply adjusted each day to account for the fees.

What is Plum Pro?

Plum pro is a new subscription service that allows users to take advantage of new savings features. Plum pro automatically includes access to Plum's investing service (which usually costs £1 per month) and the £2 monthly fee gives users access to a host of new features for 'Super Savers' which include:

  • Pockets - new saving spaces to dedicate to savings goals
  • Rainy Day savings - save more money in your account every time it rains in your local area
  • 52-week savings challenge - add a pound to your savings every week and save a total of £1,378 a year

Plum has also said that it is hoping to add Rewards into the Plum Pro package later on in 2020 which will give users access to exclusive discounts and savings with retailers.

Currently Plum Pro is only available on iOS devices with an Android release expected in mid-2020.

Is Plum safe to use?

Plum is authorised and regulated by the Financial Conduct Authority to carry out payment services activities as a Registered Account Information Service Provider, under the Payment Services Regulations 2017.

Plum is not covered by the Financial Services Compensation Scheme (FSCS) however Plum argues that FSCS does not apply to them. Plum state that 'FSCS was created to protect consumers against the risk posed by banks lending out their deposits – but Plum will never lend out money. Savings with Plum are held as 'e-money' in a secure bank account that is protected by Electronic Money Regulations, and therefore FSCS cover does not apply to us'

Plum reviews

Plum is rated as 'Great' on Trustpilot scoring 4.1 out of 5.0 stars from over 600 reviews. 71% of users rate it as 'Excellent', with most commenting on how great it is at helping them to save money and great customer service. 14% of users rated it as 'Bad' with some users complaining of connection and server issues that meant they could not access their money.

Most recently, at the beginning of December 2019, Plum experienced an issue when migrating to its new banking provider. Users were complaining that their money had left their bank account but had not yet reached their Plum account with the transaction showing as 'Pending'. Users continued to state that despite contacting Plum they had not received a response and some users were still out of pocket up to 10 days later.

Alternatives to Plum

App-only banks

Monzo and Starling Bank are app-only banks that can help you to save with round-up spending. When you spend with Monzo and Starling you can opt to round up your change, putting it into a savings pot. By setting up automatic saving you save every time you spend and while it may not seem like much, it quickly adds up.

For more information read our reviews of Monzo and Starling Bank.


Chip allows you to save automatically by using open banking to analyse your spending habits. Chip works in a similar way to Plum in that it saves your money for you and moves it into your Chip account.

Like Monzo and Starling Bank you can set savings goals and track your progress to achieving those goals. However, Chip isn't FCA regulated, although your savings are stored in a ring-fenced Barclays account.

For more information on Chip, read our Chip review.


Tandem is an app that can also help you to save money by automating the saving process. It has a similar feature to Plum, analysing your spending, moving money into a separate Tandem savings account, using its 'Safe to Save' feature.

Tandem also offers a round-up feature similar to Monzo and Starling Bank and allows you to transfer savings into your account at the touch of a button. Tandem is different from Monzo and Starling in that it does not operate as a fully-fledged bank, despite having a banking licence.

For more information on Tandem, read our Tandem review.


Moneybox is another savings app that allows you to invest the money you put away. Moneybox helps you to save by rounding up your spare change and you can invest the money you save into a variety of savings products such as a Stocks and Shares ISA, Stocks and Shares Lifetime ISA, Junior ISA or a General Investment Account.

For more information on Moneybox, read our Moneybox review.

How does Moneybox compare to Plum?

Minimum investment Monthly fee Platform fee Fund provider fees Investment types FSCS protection FCA registered
Moneybox £1 £1 0.45% 0.12-0.3% Stocks & Shares ISA, Stocks & Shares LISA, Pension, Junior ISA, General Investment Account
Plum £1 £1 0.15% 0.08-0.9% Stocks and Shares ISA, General Investment Account


Pros of Plum

  • Automatic saving
  • Invest from £1
  • Easy to set up
  • Can message to save more or less money
  • FCA regulated

Cons of Plum

  • Money isn't protected by the Financial Services Compensation Scheme (FSCS) - unless your money is invested in tech/growth funds
  • Can only talk to advisers Mon-Sat
  • Can only link one bank account


Overall, Plum is a useful tool for those who have trouble saving and I like the feature that allows you to change how much you want to save each month by selecting your mood. Plum is now regulated by the FCA and if you decide to invest with Plum, you can take comfort from the fact that the provider that Plum invests your money with (Gaudi Regulated Services LTD) is also FCA registered. If you want to compare it to other personal finance apps you can do so in our article, The best money apps you should have in 2020.


Looking for a financial adviser near you?

Do you need financial advice? An independent financial adviser can show you how to make the most
of your money. Find your nearest qualified and regulated adviser using this VouchedFor search tool.

Alternatively, Hargreaves Lansdown, one of the UK’s largest firms providing restricted financial advice, is offering a £200 John Lewis voucher* to new clients.