S&S ISA help - existing Halifax

bolzano

I have an existing stocks and shares ISA with Halifax into which I have been paying 50/60 pounds a month for the last 10 years or so.
I signed up to Charles Stanley Direct to transfer as I felt the 1.5% AMC seemed high.
However, it turns out it can't be accepted as the funds I am in are Halifax specific:
Halifax UK FTSE All Share Tracker(1.0AMC), Halifax UK Growth(1.5AMC), Halifax International Growth (1.5AMC) and Halifax Special Situations fund(1.5AMC).

As far as I can see I now have 3 options:
1. Continue as I was.
2. Leave this as it is and change my contributions to a new ISA with lower fees.
3. Take the current ISA out as cash and reinvest in a new ISA.

I'm not to sure about what might be best to do, or how to make the decision.
Any advice on this? Am I right that the fees seem high?

jimjames

Ditch those funds, far cheaper options with better performance

Eg UK tracker from 0.06% AMC

Transfer as cash will be fine, then buy better funds

bowlhead99

You are right, they seem high. For example, you can buy a UK tracker at Charles Stanley for about 0.1% or even slightly less, which when you add on the CS platform fee of 0.25%, means your all-in cost is only 0.35%. While the Halifax one is 1.0%, three times the overall price.

So, to your options:
1. No. Don't do this, you can see it's costing you a fortune compared to the broader and cheaper selection of funds available at CSD.
2. Half right. By all means go forward with a new one. But as you know the old one is expensive, don't just give up and let them keep charging you! Also, current tax year contributions are supposed to stay together in one pot under ISA rules. So that doesn't really work unless you spilt off the current year Halifax stuff from the old Halifax stuff which is messy.
3. This could be a simple solution if the total amount of value you have, plus the next few months of contributions you want to add, is under the £15k allowance for this year. You can just get Halifax to pay you out in cash and go manually reinvest it. It doesn't work if it would take you over your £15k limit though.

What you really want is 4. You have run into a problem where you filled out a form to transfer "in specie" and re-register the funds at the new provider. However, you discovered they can't be transferred and re registered at CSD because CSD, quite sensibly, don't offer those high prices funds.

So, you should try and do the transfer again. This time, tell CSD to do the transfer in as cash. They will contact Halifax, get Halifax to sell the shares, and receive cash from Halifax.You will be temporarily "out of the market" while it happens. Then you can use the cash that arrived at to buy whatever (better) funds you would like.

Functionally 4 is same as 3; may take a little longer but doesn't use a big chunk of current year allowance because it stays within the ISA wrapper at all times.

bolzano

Brilliant, thanks both! Reassuring to know I'm on the right sort of lines, and thanks for suggestion 4 which I hadn't thought of. Will go ahead with that option

jimjames

Option 5, see if cheaper funds are available at Halifax and switch your existing investment into those.

Worth checking if Halifax platform fees are low and find out what funds they offer. I believe they run platforms for others at low price so they may be reasonable if you're not using their expensive funds.

bolzano

Ok, I'm confused again..

I re-read the MSE guide on S&S ISAs and it looked like iweb would be cheaper than CSD for me as plan to keep this ISA for some time.

I would like to continue my regular payments each month. Does that count as a 'trade'? I.e. if I was invested in 4 funds say then it would be 4x5 = 20 pounds a month??

dunstonh

I re-read the MSE guide on S&S ISAs and it looked like iweb would be cheaper than CSD for me as plan to keep this ISA for some time.

Remember that the MSE guide is not whole of market. It covers some of the options. not all.

I would like to continue my regular payments each month. Does that count as a 'trade'? I.e. if I was invested in 4 funds say then it would be 4x5 = 20 pounds a month??

On platforms that are geared to share/direct holdings, then yes, its a trade and yes four funds would be four sets of charges. However, on platforms geared towards funds, that would not be an issue.