Invest £50 a month

suicidebob

Been doing a bit of reading on http://monevator.com/, but still a bit confused about the cheapest / most convenient way of going about this.

I want to invest £50.00 per month in an FTSE all share tracker. I have £1K initial investment if needed, but would prefer to invest just the monthly £50.00. I may increase the £50.00 after a few months, but unlikely I'll be doing multiple trades.

Which broker should I use?
What fees will I need to pay?

Can someone please explain the steps as simply as possible??

Thanks!

SG27

I use hargreaves lansdown for investing £50 per month in an ISA. Their charges are here: http://www.hl.co.uk/investment-services/isa/savings-interest-rates-and-charges

There are some ftse all share trackers funds available: http://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results?companyid=&tab=prices&sectorid=&tab=prices&investment=Ftse+all+share+tracker&x=-588&y=-320

More here: http://www.hl.co.uk/funds/index-tracker-funds

ChopperST

For a small holding such as this then HL would be horrendously expensive.

Have you looked at the comparison chart here?
http://monevator.com/compare-uk-cheapest-online-brokers/

A quick glance suggests Cavendish would be best for your needs.

Bear in mind that just using the FTSE All Share you are not geographically diversified and are reliant (mainly but not solely) on large cap UK firms. However the All-Share does include many multi nationals as well.

You want to ensure your portfolio includes;
The US, Europe, The Pacific, Japan and depending on your timescale some form of bond or guilt fund as an element of defence against market downturns (though at your portfolios current size I'd suggest you just use one of the 5% cash current accounts that are out there - Flex Direct or the new TSB 5% account)

GL

bowlhead99

ChopperST wrote: »

For a small holding such as this then HL would be horrendously expensive.

Have you looked at the comparison chart here?
http://monevator.com/compare-uk-cheapest-online-brokers/

A quick glance suggests Cavendish would be best for your needs.

I would challenge that assertion that HL would be horrendously expensive. The OP is suggesting that they would rather not invest £1000 if they don't have to, and instead just invest £50 a month. During year 1, their balance will increase over the course of the year from £nil to £600. The average daily balance over that period is around £300ish, and at the end of the year the balance might reach £650 if the FTSE has a very good year. Or less if it does not. During year 2 you are looking at a balance in the £600-1200 range (average balance £900ish), plus or minus the effects of market movements. By year 3 we will be looking at the £1000-£2000 range (maybe average balance £1500ish).

If your opening line is going to be a statement that HL is "horrendously expensive", specifically "for a small holding like this", I presume you have done the maths. So please can you tell us what the horrendous extra costs will be if HL is used rather than Cavendish which is 0.2% cheaper?

Over the first three years of holding the investment, I make it about a fiver?

So at this level, for something significantly lower than 2 pounds a year, you get a platform with one of the best reputations for customer service, and best navigable websites, not to mention enough junk mail to fuel your barbeques all summer and insulate your house through winter.

If you were investing 200k I would agree there is value to shopping around. At 0-2k there is much less value in it and it is disingenuous to say HL's pricing is horrendous. Though of course I agree with your other points.

Archi_Bald

And what are the exit charges when you want to transfer out because your holding has become larger and the charges are no longer competitive? I don't know the answer but you need to look at it long term, not just 3 years.

ColdIron

I think HL charge £1.50 plus stamp duty (0.5%) for monthly saving in shares and 0.45% capped at £45 which doesn't trip my 'horrendously expensive' monitor. HL's slick site and customer service may be worth paying a premium for especially to someone new to investing. Their exit charges could become a worry but it's far from the worst place to make a start

I'd be more worried about such small amounts into a single index

grey_gym_sock

ColdIron wrote: »

I think HL charge £1.50 plus stamp duty (0.5%) for monthly saving in shares

and nothing for monthly investing in funds.

0.45% per year for holding funds (plus exit fees eventually).