Cavendish to III

oldfella

I have around £300K in 11 funds with Cavendish. It seems I will save around £650pa switching to III.

As there is a cash offer before end Feb, it seems sensible to wait 2-3 weeks and then start the move. If I have understood correctly, there is a charge of 0.11% to cofunds which I can avoid by switching to clean funds so as switching and exit is free, I might as well get them switched before moving.

Would appreciate any views on my plans.
thanks .. Mike

kidmugsy

ISA? SIPP? Neither?

oldfella

sorry - all ISA

talexuser

Is the difference between 0.25% platform charge and £80 a year plus any £10 + £10 charges for switching funds?

Does the 1% dividend reinvestment charge apply to funds too? If your 300K generated 4% a year, that might add up to another £120 if the case. Presumably you would avoid it with ACC funds?

Worth thinking about though.

oldfella

I dont do many switches so I hope generally to use the free £20 of switches each quarter.

will research the reinvestment charge - thanks for that.

mr-tom_2

I'd wait a month or so. RDR2 means everybody is announcing new charging structures at present, so may as well wait until a more complete picture is known before settling.

If I recall correctly, cavendish have yet to announce their structure, but given Fidelity's, I'm expecting it to be good.

grizzly1911

mr-tom wrote: »

I'd wait a month or so. RDR2 means everybody is announcing new charging structures at present, so may as well wait until a more complete picture is known before settling.

If I recall correctly, cavendish have yet to announce their structure, but given Fidelity's, I'm expecting it to be good.

Didn't Cavendish introduce their structure before the New Year or was that another interim step? (0.25%, no exit/no fund dealing fees)

oldfella

grizzly1911 is correct, Cavendish RDR charges are 0.25%.

talexuser

Also clean funds are only being used for new money, transfers are going into old funds with their old rebates meanwhile, or into cash for funds not in Fundsnetwork (2 of my funds), old funds in Fundsnetwork will be converted to clean "during the 1st quarter of 2014".

Not really a problem, maybe cash is a bonus if the market falls during your transfer process like the last week. Or you can wait a little for a dip, free switching gives some advantages here, and naturally for rebalancing.

The Fundsnetwork advantage is that any rebates get re-invested automatically and thus don't count towards your ISA allowance as they did with CoFunds where rebates went into the cash account for you to invest manually, and thus reduced your yearly ISA allowance.

I still think iii is worth considering for larger pots, I will probably move there after all the dust has settled with clean funds.

oldfella

discussed with III, the 1% dividend charge applies to inc funds where the dividend is reinvested. If its paid out there is no charge.

the situation on clean v dirty seems less clear. It appears that III have a charging review forthcoming in a month applicable to clean funds. I suggested it would be easier and more economic if I switched to clean funds before the transfer and he confirmed there could be a platform charge saving, presumably the 0.11% cofunds charge for dirty funds. However, he couldnt say what the impact of the charging review might be.

I think I will wait a while and see what the situation is in March / April.

talexuser

That doesn't sound too bad, stick to acc funds while pot grows, convert to inc and withdraw when needed to avoid the re-investment charge as much as possible.

I agree it is probably too early to know the best platform longterm. I'm waiting till all my funds are clean, plus re-balance with the free switching in Cavendish/Fundsnetwork and then see.