Funds Network "Initial & Switch Charging structure" v "Account Fee structure"

Chris75

I am looking at moving my ISA from BestInvest to Cavendish both under the Funds Network scheme. As part of this I have discovered that FundNetwrok have 2 fee structures. I am currently with the default " Initial & Switch Charging structure" where I get charged 0.25% for a transfer from fund A to Fund B but I understand that "Account Fee structure" removes this 0.25% for an annual £45 fee.

I am however concerned that there might be other significant difference that I have missed. Are there any?

westy22

No, there are no other differences. If you are a LTBH (long term buy and hold) investor then paying a 0.25% switching fee on the rare occasion will probably be cheaper than paying a £45 annual fee. As you are investing through Cavendish then you will pay no initial fees anyway. You will only pay the 0.25% switching fee if there is an initial charge anyway i.e. if you have tracker funds with no initial fee anyway then you won't pay a switching fee either.

I think that most Cavendish customers have elected to stay with the switching fee rather than the annual fee. Of course, none of us know the future and with RDR Fidelity could make the platform fee compulsory for all at some stage.

Jegersmart

As always with these things it depends on your circumstances - or in this case how often you make changes and how big your investment total is. With 100k in your portfolio and somewhat active management style the £45 fee per year is a no-brainer......but if you have 10k in funds you never change the reverse is true....:)

Chris75

Thank you. I do not hold any tracker funds so the breakeven point for me is the amount which £45 is 0.25% of.

£18000 transfers per year.

psychic_teabag

Cavendish have just announced their own fund supermarket - still powered by fidelity, but with no switching fees.

jimjames

psychic_teabag wrote: »

Cavendish have just announced their own fund supermarket - still powered by fidelity, but with no switching fees.

I just heard this today. I'd submitted my Cofunds application last week and Cavendish phoned to ask if I wanted to switch to Fundsnetwork with no fees. As it was just re-registration I was after I decided to stick with Cofunds for this but will look to FN for future ISAs.