H-L introduces a Tracker Platform Charge

westy22

Before rushing in to move away from HL it might be better to wait awhile and see what other service providers offer once the effect of these transparency changes are delivered. You also need to work out the effect of the monthly fee, obviously a £1,000 holding will be 'costlier' than a £10,000 holding but you have to consider how many affected funds you hold and do some maths against those charges and what you would pay for an active fund or IT, ETF etc held with HL.

I couldn't agree more. I have a significant SIPP with H-L which is mostly in HSBC trackers. Taking my HSBC All Share Index holding as an example, I am paying a TER of 0.27% and the new platform fee of £24 per annum will be another 0.04% making a total of 0.31% or £170 per annum.

I doubt I could get much cheaper elsewhere (except maybe through an IFA) and I do like H-L's service and user-friendly website.

westy22

I have just been looking at Bestinvest as a potential SIPP home. Using the example I set out above, if I were to switch into Vanguard UK All Companies instead of my HSBC All Share the TER would be 0.20% but there is a 0.5% SDRT initial charge and £120 per annum custody fee (incl VAT) - that comes to £505 in year 1 and £230 per year thereafter. Not a viable option IMHO.

Totton

Currently we pay HL a fraction of what we had to pay a stockbroker 15 years ago, I was talking through this with my better half and it isn't that long ago we were being charged £85 plus stamp duty and whatever the brokerage could think of, bed & breakfasting was touted as saving us some taxes when in reality it often was simple justification for the consistent portfolio churning used by the brokers to generate income for themselves. At least with my £45 annual ISA fee I can actually see what service I am getting from HL and imho it currently represents good value for money. If I knew a decent IFA then we may use them but for now we are okay where we are.

Even Vanguard rip the UK customer off by telling us they need to charge us more than they do their US customers, the root of our problem lies not with the likes of HL, Alliance, Fidelity, BestInvest etc, it lies with exorbitant charges made by the fund providers who frequently charge their UK customer far more than they charge their German, French or US customer.

Anger over portfolio costs needs to be directed towards providers, tracker holders have the option to buy direct and doubly benefit from cheaper TER's and platform fees. We've just sold a decent amount of Jupiter funds due to their charges and recent under performance, the money is going into ETF's and IT's via HL.

Regards,
Mickey

jon3001

Does anyone know if these platform charges are capped at £45/yr as part of the ISA's AMC?

jamesd

dunstonh wrote: »

£2 is not much and its certainly a temporary position given the RDR and the platform review.

Not much? It's more than the annual charge of Skandia if you hold just three tracker funds and hold the replacement Blackrock funds under a nil trail commission arrangement.

Totton

jon3001 wrote: »

Does anyone know if these platform charges are capped at £45/yr as part of the ISA's AMC?

No they're not and they do not count towards the ISA fee if you hold a qualifying instrument.

HTH,
Mickey

Totton

jamesd wrote: »

Not much? It's more than the annual charge of Skandia if you hold just three tracker funds and hold the replacement Blackrock funds under a nil trail commission arrangement.

But what's the problem, simply move to Scandia if you want the affected funds which are just 30 of the 2,400+ currently available at HL :-)

Mickey

atush

gadgetmind wrote: »

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.

I too had made enquiries and had the pack to fill out lol

webnibbler

Too late for me. Set up my SIPP with H-L less than two months ago, all in the HSBC tracker range. Don't think I have the energy to start the move to another platform right now.

My thinking is to wait and let all the effects of RDR on the platforms settle before making any decision to move to another provider. Who knows what changes may be coming.

gadgetmind

webnibbler wrote: »

Too late for me. Set up my SIPP with H-L less than two months ago, all in the HSBC tracker range. Don't think I have the energy to start the move to another platform right now.

More news. HL have said in emails to those complaining that they intend to shortly introduce the Vanguard range. I have emailed to ask if this will include the LifeStrategy range as these are a portfolio in a single tracker. £24pa for this is very cheap IMO!

[edit]

What they actually said was -
"Previously, we had covered the costs of providing a number of tracker funds, but as demand for these funds has increased so have our costs. We are therefore introducing a platform fee to cover these costs and allow us to increase the range of funds we offer. We expect to be able to offer Vanguard funds shortly, for example. Like all other funds they will be available with a minimum of £1,000 (£500 is the Junior ISA) and we will make no charges to buy or sell."