H-L introduces a Tracker Platform Charge

westy22

It appears that Hargreaves Lansdown are to start charging a platform fee of £2 per month per HSBC Index fund from 31 Dec 11. We have all been expecting some sort of charge since these funds became more popular but I think £24 per year per fund is very steep so I'll be off to pastures new!

dunstonh

westy22 wrote: »

It appears that Hargreaves Lansdown are to start charging a platform fee of £2 per month per HSBC Index fund from 31 Dec 11. We have all been expecting some sort of charge since these funds became more popular but I think £24 per year per fund is very steep so I'll be off to pastures new!

Its just the start. Wait until HL are no longer getting the IFA commission and then when the FSA bans on bundled platform takes place and explicit charges exist for all funds. It is this sort of discrimination that the FSA wants to get ride of.

gadgetmind

Let the exodus begin! I had my forms filled in for a HL SIPP, and the cheque was to go off on Monday.

Time to start again, from scratch, so if anyone knows a SIPP that can hold HCBC and/or L&G and/or Blackrock trackers and that doesn't charge silly fees, please let me know.

I don't kind paying something, but £24 per tracker is a "no go" if you want to hold eight or so of them.

westy22

It would appear that H-L have decided that, by hook or by crook, each customer will in one way or another pay close to £200 per year for being on their platform.

Their 0.5% additional charge is capped at £200 per year; a selection of HSBC trackers could be between £150 - £200 per year; 0.5% retained trail commission on commission-paying funds would be about £200 on a £40,000 pot.

Lokolo

I am surprised they have announced this charging structure, yet nothing about post RDR. Still waiting..!

jamesd

Yes, that charge is now shown in the factsheets for the funds.

That's a great shame because those funds were a substantial part of why it was easy to say that the HL offering was cheaper than many others. At 2.4% a year added charge for a £1,000 holding plus the effect of compounding that'll no longer be true.

westy22

They haven't announced it as far as I am aware! It has just suddenly appeared on the fund factsheets within the past 24 hours or so.

vulcan59

It's not just tracker funds. I just checked my funds and there will be a £2/month platform fee on The M&G Index Linked Bond fund from 31/12/11. However, in this case it replaces the current 0.5% fund managers annual charge.

gadgetmind

westy22 wrote: »

a selection of HSBC trackers could be between £150 - £200 per year

Yup, about £204pa for what I was planning - £2x7 pcm for HSBC, £1 pcm for Royal London Index linked, ditto for L&G EM index and unknown for the Blackrock property fund.

Fidelity look like a good alternative other than them not having a low-cost global property fund.

Mikeyorks

So just what creates the breakpoint between a platform fee - or not? I've just swept through my (33) Funds. The Platform Fee now shows on all the factsheets - but as Free.

SnowMan

Hugely disappointing news

We can expect to get notification soon as they have to give 30 days notice (don't think just sneaking it into the factsheets counts as notice in my view). This is what their terms and conditions say

14. MAKING AMENDMENTS TO THESE TERMS

Material Changes to Terms : We will notify you at least 30 days before making material changes to these terms. Terms are likely to change if we introduce a new service or replace or make reasonable changes to the way we provide an existing service, where there is a regulatory change, to make the terms easier to understand or to remedy manifest errors.

Changes to Charges/Costs: We may vary the fees and costs of our
services from time to time or introduce a new charge. Any change, or new charge, will be proportionate to the costs we incur and with a view to the market rate. Commissions and fees are in accordance with our rates, published from time to time, which are available on our Website or upon request.

New terms and Charges will only come into force once the 30 day notification period has expired. This means you can end the contract with us during the notification period and all existing terms will apply.