Junior ISA with Hargreaves Lans

ro2778

I'm not a regular visitor to the forum but browse occasionally and noticed a lot of people talking about HL becoming uncompetitive. I recently started a Junior ISA for my niece with HL (in Dec 2013). I invest in a couple of funds regularly each month and the total value is currently £1500.

What exactly is the issue with HL? Is there a better place for me to invest in funds with a junior isa?

Thank you for any help.

Archi_Bald

The issue is that for a lot of investments, you can get significantly cheaper brokers than HL. Their management charges and their auxilliary charges can eat significantly into your investment.

You would most likely get the investment you have cheaper in places like Charles Stanley Direct or iWeb, to mention but a few. But the exit charges from HL are likely to be so high that it is most likely not worth your while. Some people (incl myself) have negotiated free exit from HL - there's a massive thread on this on the Savings forum.

On low investments like yours, the immediately apparent difference between HL will be quite small. But as your investment grows, the amount that goes to HL can grow exponentially. You also need to take into account the frequency of your trades.

Locate snowman's spreadsheet that lets you figure out how much the various platforms charge. It's listed somewhere on the savings board.

grey_gym_sock

since you're making regular investment in funds, with quite a small current total amount invested, you want a provider who doesn't charge for dealing in funds, and who charges an on-going percentage, not an amount in GBP.

you have that now. however, the percentage could be lower.

HL are charging 0.45% a year; charles stanley direct or cavendish online would charge 0.25%. so on £1500 current value, the difference is £3 per year.

there's no point in moving if you're going to pay the £25 per holding exit fees. if you want to move, either get them waived (which seems to work for everybody who tries properly), or transfer out in cash, not in specie (which incurs no exit charges if it's done before 2 june).