T D Waterhouse & others cheating us on Interest Rates on self select PEPs and ISAs

debbie42

King_Weasel wrote: »

I was under the impression that I needed the cash in place before I bought shares. Like debbie42, I can transfer cash with one click but I thought it took 2-3 days to arrive and my broker needed the cash before buying.

Am I wrong on either or both of these points, or does debbie42 have a better bank and/or broker? (Or maybe debbie42 can see 2-3 days ahead?)

Unfortunately I'm not clairvoyant. :rolleyes:

I use my debit card to fund my account, and this does allow trading straight away at my broker (selftrade). My Halifax share account allows trades without even actually having the cash there. I have a limit with them, of course, and they settle within 2 or 3 days direct from my bank account.

JM_2

Hi,

Thank you all for the input and the useful links.
http://www.hmrc.gov.uk/stats/peps/table9-2.pdf

http://www.hmrc.gov.uk/stats/isa/table9-6-onwards.pdf

According to the above gov stats links :

As at 5th April, 2006

Cash held in

PEPs was £ 1,540,000,000

ISAs was £ 1,516,000,000
.

---

Total cash £ 3,056,000,000
. ===========

So if majority of plan managers are ripping off the investors, then can you guess how much interest they are keeping for themselves on the above figures ; and not passing on the income to the rightful investor.

JM_2

:eek:

Xbigman

JM_2 wrote: »

There are now so many instances where Financial Institutions are ripping us off. eg : Bank penalty charges , Interest rates on existing Saving Accounts being lowered, Charging excessive interest rates on loans etc.

I hold no love for the financial institutions but I find the above comments rather biased and ultimately untrue.

Overcharging on loans, well, thats cobblers. Rates currently are historically low. OK its because they are ripping people off with PPI and the like, but that just means the MSE minded can get cheap loans and avoid the pitfalls.
Bank penalty charges are good, anyone who never goes overdrawn will get the subsidized free banking.
Reducing interest on old savings accounts is good because we can move our money to the latest market leading account the old crap rates subsidize.

Don't fool yourself, for the savvy the current situation is excellent. If we had to pay fair value then we would be paying for everyday banking, cheap loans would be 9.9% rather than around 6.5% and savings accounts would rarely get above 4%. We would also all be paying the SVR on our motgages of around 7.50%.

And if it was all more regulated it would reduce choice.

I feel sorry for those caught out, after all I was one of them once. But I don't knock the current situation as I think its hypocritical to have a go at something I benefit from.
Regards




X

King_Weasel

Thanks for the info, debbie42. I'll check out what my self-trade brokers do. If they don't allow me to trade like you I'll consider Halifax. Of course, they may charge more than mine, so as usual its swings and roundabouts. But at least I'll be better informed on terms and conditions.

JM-2, I'm afraid you're getting carried away here: the cash figure you quote in 13 above must be in Cash ISAs. I doubt the Govt figure includes cash in S&S ISAs, which must be an insignificant sum.

cheerfulcat

King_Weasel wrote: »

I'm not here to fight JM-2's battles, but I didn't read their problem as relating to LONG-TERM cash holdings, as cheerfulcat and debbie42 evidently believe. Tonight's FTSE is the highest for years. Suppose JM-2 wants to take profits and reinvest at the next dip? This might be months away. Why not have a reasonable return on the cash meanwhile? That's all.

I assumed that JM-2 was referring to short term cash. Unless s/he has huge amounts in cash in the account at any one time, the interest rate is really not that important. And don't get me started on market timing.

But I was interested in what debbie42 says, as this matches my situation of holding shares outside an ISA. (I've started another thread here on the pros and cons of self-select ISAs.) I was under the impression that I needed the cash in place before I bought shares. Like debbie42, I can transfer cash with one click but I thought it took 2-3 days to arrive and my broker needed the cash before buying. Am I wrong on either or both of these points, or does debbie42 have a better bank and/or broker? (Or maybe debbie42 can see 2-3 days ahead?)

Debit cards are instant. And ironically, TDWaterhouse ( the focus of the original complaint ) are one of the brokers which allow extended settlement, so you can trade without cash in the account...

debbie42

King_Weasel wrote: »

I'll check out what my self-trade brokers do. If they don't allow me to trade like you I'll consider Halifax. Of course, they may charge more than mine, so as usual its swings and roundabouts. But at least I'll be better informed on terms and conditions.

Halifax are slightly cheaper (for the sort of value trades I do) than Selftrade, i.e. £11.95 as opposed to £12.50. Their ISA charges are a percentage of the account, so it depends on how much you have in it as to which is the cheaper of the two.

JM_2

King_Weasel wrote: »

JM-2, I'm afraid you're getting carried away here: the cash figure you quote in 13 above must be in Cash ISAs. I doubt the Govt figure includes cash in S&S ISAs, which must be an insignificant sum.

Hi,

That's a good point.

If you refer to the schedule here :

http://www.hmrc.gov.uk/stats/isa/table9-6-onwards.pdf


You will see that the figure I have quoted is correct.

There is £1,516,000,000 cash in the ISA Stocks and Share component.

There is £107,571,000,000 Cash on Deposit in the ISA Cash Component.


Thanks


JM_2
:eek:

cheerfulcat

" As of the 5th of April ". Don't you think that the date might be significant? And that there might be a lot less cash on deposit in, say, October?

Biggles14

[Re: JM_2]
Businesses like Financial Advisors, Banks, Stockbrokers etc. are intent on making a profit and the way they do it is charge as big a fee as they can get away with, also annual charges, management charges etc. Shareholders in these Companies benefit by receiving hopefully good dividends. The answer to your question must be therefore that you dont leave your investments with one of these institutions but take care of it yourself. Buy your shares, hold your own certificates, collect your dividends with no charges, and keep your spare cash in an interest bearing account until you need it.

Paul_Herring

Just like to point out, for those that are unaware, that any interest on cash deposits in an investment ISA is liable to tax at your marginal rate - the investments in such an ISA may take advantage of the tax free nature of the wrapper, but cash cannot.