Hargreaves Lansdown charge 0.45% pa - Alternatives?

badger09

Brogden_Fields wrote: »

Just spoke to them about opening a new ISA account and transferring an existing ISA to them and they wouldn't budge on the 0.45% with no cap up to £250k.

Clearly, you're not someone HL want to retain, presumably because your 'pots' are too small.

I didn't even bother asking for a reduction as I know what the answer would be

I did however get agreement to waiver of fees for my transfer to iWeb

Brogden_Fields

badger09 wrote: »

Clearly, you're not someone HL want to retain, presumably because your 'pots' are too small.

I didn't even bother asking for a reduction as I know what the answer would be

I did however get agreement to waiver of fees for my transfer to iWeb

Yes, that was fairly clear even to me!

iWeb seem to be somewhat restricted in the funds they offer?

ScarletBea

I've been reading all these threads about HL, and everyone just mentions the HL fee - no one is even checking if the fund's annual charges offset that.
I've checked the funds I have, and even in the "inclusive option" (the one to which everyone has been changed) there is a charge reduction of around 40-50%. This includes the fund's charge and the loyalty bonus. Then in some cases, if you convert them to the "unbundled" option, the savings are even higher.

Of course everyone's situation is different, but I just think that people are too focused on this fee and aren't paying attention to the other costs/benefits.
A capped fee of £45 still gives me a very good deal with HL and the funds I have.

naedanger

ScarletBea wrote: »

- no one is even checking if the fund's annual charges offset that.

I cannot speak for everyone but I know I have checked and for me HL's new charges involve a many fold increase on the previous charges, and for me there was no offset from the fund's annual charges.

yatinsardana

ScarletBea wrote: »

I've been reading all these threads about HL, and everyone just mentions the HL fee - no one is even checking if the fund's annual charges offset that.
I've checked the funds I have, and even in the "inclusive option" (the one to which everyone has been changed) there is a charge reduction of around 40-50%. This includes the fund's charge and the loyalty bonus. Then in some cases, if you convert them to the "unbundled" option, the savings are even higher.

Of course everyone's situation is different, but I just think that people are too focused on this fee and aren't paying attention to the other costs/benefits.
A capped fee of £45 still gives me a very good deal with HL and the funds I have.

You may be right. Which funds are you talking about? Can you give some examples?
When I looked at the funds i saw that on average HL was giving an exclusive discount of about 0.1-0.15% so funds where TER was 0.75, often HL would reduce it down to 0.65%

Keeping that in view the huge percentage fee of 0.45% isn't offset by the fund discount.
Also as far as my understanding goes the 0.45% isn't capped at £45. Only stocks are. So unfortunately the annual absolute cost may be more than that.

But I agree with you in the sense that this increase in charge won't affect everyone .. It depends what's in your portfolio and where you see your portfolio going.

masonic

ScarletBea wrote: »

I've been reading all these threads about HL, and everyone just mentions the HL fee - no one is even checking if the fund's annual charges offset that.

On my main holding (55% of my portfolio), the charge before the change was about 0.4% including a £2/month platform fee and it is now double that including the 0.45% platform fee.

A capped fee of £45 still gives me a very good deal with HL and the funds I have.

Did you negotiate that cap individually? There is no £45 cap on funds for customers paying the standard charges.

Rollinghome

ScarletBea wrote: »

I've been reading all these threads about HL, and everyone just mentions the HL fee - no one is even checking if the fund's annual charges offset that.
I've checked the funds I have, and even in the "inclusive option" (the one to which everyone has been changed) there is a charge reduction of around 40-50%. This includes the fund's charge and the loyalty bonus. Then in some cases, if you convert them to the "unbundled" option, the savings are even higher.

Of course everyone's situation is different, but I just think that people are too focused on this fee and aren't paying attention to the other costs/benefits.
A capped fee of £45 still gives me a very good deal with HL and the funds I have.

I'm not sure which fund you think offsets the 0.45% platform charge compared with the 0.25% or less you could pay elsewhere (and without all the other various charges for dividend reinvestment, exit fees, paper statements, contract notes etc. now made by HL) but would be very interested.

In fact for most of HL's "inclusive" versions I've looked at they are charging both the 0.45% fee and still retaining a portion, or in some cases, all of the commission. For example http://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/r/ruffer-cf-total-return-class-o-accumulation-inclusive In other words, they are charging twice.

I don't know any other platform doing as HL and taking both commission and the full platform charge and I'd guess that many of their clients are unaware of what they're doing.

In contrast, Cavendish clients for example are charged either a 0.25% platform fee on clean funds or are refunded all of the trail commission if they prefer to hold onto their bundled funds.

I haven't looked too carefully but HL seem to have secured discounts on a little over 1% of available funds - including several that are well past their best with managers who are desperate to retain investors. I'd be surprised if many discerning investors will want to confine their investments to so few funds.

innovate

masonic wrote: »

There is no £45 cap on funds for customers paying the standard charges.

If there was a £45 cap on funds, I would quite happily have stayed with HL. But they wanted to up my £24 annual charge to an obscene £450, and no cap in sight even if I bought further investments. No thanks, HL.

jimjames

masonic wrote: »

Their strategy seems fairly clear when it comes to customer retention:

- If you are a more profitable customer with a large portfolio and want to leave, then they will enter into a special arrangement with you

Rather a misleading response from HL

Unfortunately we cannot offer you a lower percentage rate. We cannot comment on specific client scenarios but our pricing tariff is clearly stated and is designed to be fair, competitive and sustainable. It is not our standard approach to have individual arrangements – with 577,000 clients this would simply be unworkable.


Complete cobblers based on replies here that various customers HAVE been offered individual arrangements.

However this bit did make me laugh especially with all their miscellaneous charges

When comparing Vantage to other services, it’s important to take into account all the charges of other services, not just headline figures.

I couldn't agree more!

jimjames

ScarletBea wrote: »

I've been reading all these threads about HL, and everyone just mentions the HL fee - no one is even checking if the fund's annual charges offset that.

I think you'll find that everyone here commenting with confidence has done exactly that - and checked other charges too - so they can make up their mind about the benefits or otherwise of staying with HL.

I'd suggest you do the same so you know exactly how much cheaper it could be elsewhere - it may not be cheaper everywhere but undoubtedly some platforms are cheaper than others.

ScarletBea wrote: »

Of course everyone's situation is different, but I just think that people are too focused on this fee and aren't paying attention to the other costs/benefits.
A capped fee of £45 still gives me a very good deal with HL and the funds I have.

As already mentioned you need to check if you have misunderstood their charges and if that will affect the cost of the platform for you. If you have more than £10,000 of funds with HL then your calculations will be wrong if you are assuming your fee is capped at £45 (unless you have been able to arrange a very special deal with them).

For example:

AXA Framlington UK Select Opportunities

HL Fee 0.45%
Unbundled Fund Fee 0.75%
Bundled Fund Fee 0.75%

Total HL Platform & Fund fee 1.2%

Cavendish Fee 0.25%
Unbundled Fund fee 0.75%

Bundled fund 1.5%
Cavendish rebate 0.5%

Total Cavendish Platform & fund cost 1.0%

Ah, but that's only 0.2% difference. True but in reality that is 20% more expensive at HL than Cavendish

Rollinghome wrote: »

I'm not sure which fund you think offsets the 0.45% platform charge compared with the 0.25% or less you could pay elsewhere (and without all the other various charges for dividend reinvestment, exit fees, paper statements, contract notes etc. now made by HL) but would be very interested.

It doesn't cover the various exit costs but in terms of the fund & platform the only one I've seen that is cheaper is Lindsell Train

0.45% fund fee and 0.45% platform, 0.9% total for a managed fund with good track record isn't a bad deal. Limited availability elsewhere so useful to use HL for holding that one.