Did you know you can buy and sell shares and ETF funds with no dealing fees?
Freetrade is a new breed of investing apps which are opening up investing to a wider range of people who can now invest even very small amounts without incurring any fees.
Check out how to claim a free share worth £3-£200 for depositing as little as £1.
Please be aware terms and conditions as well as pricing can change at any time. No financial advice is intended within this post.
Freetrade App Review
Freetrade is one of a new breed of investing apps offering a freemium model to basic account customers.
Offering free fee trading with:
- No buying and Selling Share/Funds fees
- No Account Inactivity Fees
- Free Withdrawals
There are options which do incur fees such as instant trading and faster withdrawal times, but it’s your choice on whether you choose these over the free options.
How To Claim The Free Share Offer
Freetrade only offers one invite at a time, so if you’d like an invite referral link please contact me, via email or DM me via any of my social media channels and I’ll be happy to send one as soon as I have one available.
Once you receive the invite code, simply:
- Click my referral link.
- Input your email.
- Download the Freetrade app via Apple Apple Store or Google Play
- Set up a basic account using the same email address
- Deposit £1 (or more if you choose).
- Receive a free share worth £3-£200 within 3-7 days.
Sign Up Process
Signing up for an account is really easy:
- Set up a 4 digit passcode
- Fill in First & Surname
- Select Date of Birth
- Input Postcode & select address
- Select Nationality
- Input National Insurance Number
- Choose Account Type (I chose Basic)
At this stage, you are signed up.
US Tax exemption W-8BEN
Next, you need to complete a US tax exemption W-8BEN form in case you get a US stock.
This is to do with us being in the UK and taxed differently on dividends to people in the US. It will actually reduce any tax you pay if you ever own a US share (remember you might get one for free).
The W-8BEN form is really simple to complete as you can see below.
Just tick the 4 boxes that apply and click to continue. Easy.
On the next screen “Confirm your details” and click continue.
Read the W-8BEN declaration, tick the box and submit if it’s all correct. You’re done.
Next Deposit Some Funds (as little as £1 for the free share)
The next step is to transfer money from your bank account to your Freetrade account.
Deposits are transferred from 8 am to 8.30 pm Monday to Friday.
Cash should reach the Freetrade account within 2-4 hours.
Again, it’s very simple and all explained clearly within the app. All you have to do is enter your bank details:
- Sort Code
- Account Number
Once you complete this you will be presented with the Bank transfer details for Freetrade’s
- Beneficiary: Freetrade
- Freetrade account number
- Freetrade sort code
- Your Unique Basic Account reference
Reminder: When making a bank transfer remember to include your unique reference number in the reference field when you make the actual payment. This is so the deposit goes into your freetrade account.
I personally took a phone screenshot of the payment details and did a bank transfer There was also an option to pay via Apple Pay if you use that payment method.
National Insurance Number
As part of the signup process, you will need to state your National Insurance number. This is for identification, regulatory and tax purposes.
Where to find your National Insurance No:
- National Insurance card
- Wage slips
- Self Assessment tax paperwork from HMRC
Recommend Friends For More Free Shares
Once you have an account you can then recommend other friends to join and each receive a free share each worth up to £200.
You have to use your free share invite wisely as you only get one at a time, so only refer the link to people you know are going to use it.
Freetrade Account Types
Freetrade offers 2 types of accounts:
- Basic Investing Account
- ISA account.
For the sake of taking advantage of the free share offer and maybe starting in small-time investing the Basic Account will likely be suitable for most people.
An ISA is a tax-efficient savings account. It’s more suitable for people who are investing large sums over the long term and want to take advantage of the tax-free capital gains and dividend income. You can only have one Stocks & Shares ISA open with any one provider at a time. Generally, it’s a decision you should give thought to and compare with all options available.
Within the Basic Account, everyone has annual tax allowances for capital gains (selling shares or funds at a profit) and dividend income.
Is Your Money Safe?
Freetrade is a UK-regulated stockbroker. Your money is protected by the Financial Services Compensation Scheme (FSCS) up to £85,000, just the same as high street banks.
What Shares and Funds Can You Buy?
If after claiming the free share you decide you want to start investing you can choose from a range of:
- Uk Stocks
- US Stocks
- Wide range of funds including bonds, gold and Index EFT’s
Deals Aren’t Instant
Your share deals aren’t instant. They will be batched will numerous other trades collected through the day via other Freetrade customers.
This could be an issue if the price changes between the time you place the buy or sell trade and the time Freetrade complete the trade, which is sometime in the afternoon.
You can place instant trades but this will currently cost you £1. Therefore the deal size should bear that in mind as ideally, you don’t want your dealing fees to be over 1-1.5%, because over time this will hinder your overall investment returns.
FX Spot Price Fee
If you purchase US Stocks or any other foreign stocks if they offer them in the future you will be charged a foreign exchange fee. This is currently 0.45%.
This may also be applied to dividends from UK companies than payout in US$.
How Can Freetrade Offer Free Share Dealing?
Freetrade is relatively new as a business and has set out to keep its overheads low.
One of the ways they do this is batch trading of customers orders, which keeps there operational costs low.
In the future, Freetrade intends to launch Freetrade Alpha which will be aimed more at premium customers and be more geared as a source of revenue for the business.
Freetrade v Trading 212
Trading 212 is a very similar fee-free investment and also gives away a random free share worth up to £100 when you sign up via a referral link.
Trading 212 doesn’t batch trades and still offers instant dealing for free. They also don’t charge a FX spot rate when purchasing foreign shares or receiving foreign currency dividends.
As well as taking advantage of the free share offer (contact me for your own invite link), the Freetrade app acts as a great introduction into the world of investing. One which anyone can get involved with starting with just a few pounds.
If you have tried the app, please let me know what you think.
If you received a free share please feel free to let me know what you got and how much it was worth. Did you keep or sell it?