iii introducing quarterly £20 charge

scaryfruit

peetj wrote: »

I'm no MSE boffin, I have a single shares ISA in III worth around 25k.
Is it worth my while transferring out ? or is the £80 pa. cheaper than fees i'd have elsewhere?

Obviously £80 is more expensive than paying nothing, but are there any other management fee's which I'm not considering?

Cheers!

I know a couple of other replies have said the opposite, but I received an email from III yesterday explaining in more depth the reasoning behind their charges, and if I've understood correctly it means you'll be better off not worse off. Within the email, it states the following:

Rebate of all income we receive on your funds

• We believe that recurring annual commissions are obscure and many customers are not fully aware of the impact of these commissions on their investments. We aim to be clear and straightforward with our customers on exactly how much they pay to us. Some competitors rebate a portion of this commission but may not be so open as to how much they are keeping.

• As a result, we will pass on to you ALL income we receive from any fund investment you hold with us. For example on a typical fund with a 1.5% Annual Management Charge, this would be 0.64% of your investment every year; on a £10,000 investment this would be £64 each year coming to you rather than to us.

• This rebate is in addition to your Quarterly Free Trades described above.

Now, I'm really no expert on this kind of stuff, but does the above statement mean a £25k investment would mean you'd be £160 better off each year? After the quarterly fee wouldn't you then be £80 better off, not worse off? And in addition to this, you'd still get your two free quarterly trades if you wanted them, meaning further savings.

Can someone tell me what I'm missing?

westy22

For example on a typical fund with a 1.5% Annual Management Charge, this would be 0.64% of your investment every year; on a £10,000 investment this would be £64 each year coming to you rather than to us.

If you had £25k in managed funds then you would be correct, the rebate would be in excess of the charge. However, if your £25k was mainly in trackers or in shares then there would be no rebate.

TechnoBadger

scaryfruit wrote: »

Can someone tell me what I'm missing?

You're missing the point that prior to yesterday's carefully drafted email, which is likely to have only been sent after intervention from the FSA, the company put themselves in a completely different light which many spotted and didn't like.

oftm

TechnoBadger wrote: »

If you're selling your shares and then closing your iii account then place the trades by telephone. Tell them what you're doing and they won't charge commission. Apparently.

Too late for me as I've already sold and closed the account but sounds like good info for anyone who hasn't yet. Thanks anyway.

cashbackproblems

Im one of the few who would benefit from transferring, however I only have about 15k shares (spread over 5 companies) holding long term, is it worth moving to HL who have some sort of % charge (max £45) per year or elsewhere?

I currently have a HL Vantage ISA so the process would be easier

gadgetmind

cashbackproblems wrote: »

is it worth moving to HL who have some sort of % charge (max £45) per year or elsewhere?

HL aren't a bad option for an ISA packed with equities and ITs. The £45 doesn't cover trackers but this might not bother you.

TechnoBadger

cashbackproblems wrote: »

Im one of the few who would benefit from transferring

Strictly speaking I wouldn't be any worse off staying as I trade at least a couple of times a quarter. But my account is getting to the size where I felt uncomfortable staying with an outfit that I'm really not sure about long term. Maybe they're not tin-pot but that's how they've come across to me over the last 6 months or so. The opportunity to leave them free of charge has been taken gladly. Thank you FSA. (Maybe having been caught up in the Icesave debacle makes me overly cautious.)

westy22

TechnoBadger wrote: »

Strictly speaking I wouldn't be any worse off staying as I trade at least a couple of times a quarter. But my account is getting to the size where I felt uncomfortable staying with an outfit that I'm really not sure about long term. Maybe they're not tin-pot but that's how they've come across to me over the last 6 months or so. The opportunity to leave them free of charge has been taken gladly. Thank you FSA. (Maybe having been caught up in the Icesave debacle makes me overly cautious.)

I am exactly the same - the option is leaving with a 'get out of jail free' card was enough to convince me to go now rather than in 6 months time if things get worse. I have gone to X-O; I am somewhat reassured by their strapline 'promise' to never introduce an inactivity or management charge.

scaryfruit

westy22 wrote: »

If you had £25k in managed funds then you would be correct, the rebate would be in excess of the charge. However, if your £25k was mainly in trackers or in shares then there would be no rebate.

Ah, right. I thought I was missing something. Glad I checked

That clarifies things for me. I'll be joining the others who are opting to move their funds elsewhere.

i1189

Leahcim1985 wrote: »

Anyone else just sticking with iii until the RDR is complete so you can see where the smoke settles? don't want to move today to have to do the same in a few months time.

I am moving:
1. Because I think iii's attitude has been disgraceful.
2. Because having looked at their accounts, I'm not convinced they'll still exist this time next year.
3. Because it's free at the moment, thanks to the FSA.