Platform/Fund costs

zolablue25

Hi

I am looking, for the first time, at having a S&S ISA with a regular monthly payment and, perhaps, some lump sum deposits. I have been considering using HL as a work colleague uses them but their 0.45% ISA fee seems quite steep compared with Cavendish Online at 0.25%. However, I am vaguely aware that this is not the only consideration of charges that I need to take into account.HL seem to offer a discount on many annual fund charges, do Cavendish do similar? I'm thinking of, initially at least, just going for funds, mainly tracker types to keep costs down. Neither HL nor Cavendish charge to purchase funds. What other costs do I need to consider to enable me to make a comparison.

Appreciate any help that may be given.

Cheers

BLB53

As you say, HL is more expensive so either Cavendish or Charles Stanley Direct - both 0.25% would be the better options to start off.

When the value of your portfolio gets up to around £30,000 the percentage charges may not work out so well and it might be worthwhile going for a fee based option.

Check out the comparison tables on https://www.Monevator.com

bowlhead99

You're right that HL seem to offer a discount on many annual fund charges... although some of these discounts are non-exclusive and can be found elsewhere.

Generally only the ones they are promoting more heavily are the ones with the exclusive or semi-exclusive discounts: their 'wealth 150+' which is about thirty funds out of more than two thousand.

The discount on 'initial charges' are all smoke and mirrors as virtually nobody actually makes you pay initial percentage charges for buying into a fund - so the focus of your comparison should just be on what is the discounted [ongoing charge percentage plus platform fee] at HL, vs elsewhere.

Clearly if they offer you 0.15% off the OCF but then charge you 0.45% platform, you would be better going somewhere that didn't have any discount at all and then only charged 0.25% platform. Or maybe even somewhere that didn't have any discount but only charged you 0.2% platform plus £1.50 for your regular monthly purchases.

The various platform comparison tools are useful. Either decide a specific fund that you want to hold and find the cheapest place to buy it, or just generally find out what place is cheap to hold a very wide range of funds and then look at what specific funds they have available. The worst thing to do is to go to an expensive place like H-L and then only look at the funds which happen to have an ongoing charge discount - that'll never get you the best result and it will bias you to specific fund managers who might have the lowest headline fee by 0.1% p.a. but perform 10% p.a. differently from a fund that's a better fit for your circumstances.

zolablue25

The other thing I need to consider is the minimum amount you can pay into a JISA each month or as a lump sum. HL its £25pm or £100 as one sum, with Cavendish its £50pm or £500 lump sum. I have been unable to find the information for Charles Stanley on their website. Unfortunately I think that rules out Cavendish as I can't afford those amounts for my daughter, although it would be acceptable for my own ISA.

Could anyone point me in the right direction to find out the minimums for Charles Stanley?

Thanks

steelbru

zolablue25 wrote: »

Could anyone point me in the right direction to find out the minimums for Charles Stanley?

Thanks

You could try emailing or phoning them perhaps ?

zolablue25

steelbru wrote: »

You could try emailing or phoning them perhaps ?

Yes indeed, and that is what I have done. I have not, however, yet received an answer (phoning from work is not advisable), so I thought someone on here may already know what the answer is or know whereabouts on their website the answer lay.

But thank you for your helpful and constructive response.

zolablue25

Aha! I've managed to find the info under their News section. For anyone else interested the minimum is £50pm or £1000 lump sum.

Going to have to look elsewhere for daughter's JISA

The article was 12 months old but I assume the figures still stand.

Edit: I have just had a reply from CSD and it is £50pm and £500 lump sum - same as Cavendish. Probably have to go with HL for daughters fund but will probably go with one of the others for my own.

Tammy2

It is £50 a month with cavendish, or a £1000 lump sum. But these amounts can be spread over more than one fund. (I have as little as £7 a month invested in one of my funds).

zolablue25

Thanks for the info. It does say on the Cavendish website its 50/500 but if your experience is different then maybe they have something wrong there. Either way it is more than I can actually afford to pay into my daughter's account as I'm looking to pay in approximately £200-£250 a year. I know its not much but I figured its better than nothing.

I can afford to pay more into mine and so will consider either Cavandish or CSD depending on any reviews I can find.

Tammy2

zolablue25 wrote: »

Thanks for the info. It does say on the Cavendish website its 50/500 but if your experience is different then maybe they have something wrong there. Either way it is more than I can actually afford to pay into my daughter's account as I'm looking to pay in approximately £200-£250 a year. I know its not much but I figured its better than nothing.

I can afford to pay more into mine and so will consider either Cavandish or CSD depending on any reviews I can find.

When I spoke to them (fidelity) the phone about my plan to split my monthly input into amounts below £50 they said that was fine, but they "don't advertise it". And sure enough it has gone through just fine.

redbuzzard

I'll put this up because I have it - it's a quick comparison of charges for some popular funds on HL vs. iWeb.

It's "biased" in favour of HL in the sense that 5 of the funds are in the Wealth 150+ (promoted as having special discounts) and one is Wealth 150.

Even on this basis the simple average across the 8 funds offered by both platforms is still less than 0.1%.



iWeb quote "AMC" though in some cases what seems to be in that box is OCF.

Where they are using the same fund (i.e. same price per unit) any discount on the HL holding is paid as "loyalty bonus". In other cases there is a different class with a lower OCF.

It's hard work doing comparisons though because holdings make a difference (e.g. HL caps platform charges for ETFs/ITs/shares at £45, can't remember what iWeb does) and trading charges make a varying difference dependent on activity.

It's taken me an hour to write this short post with interruptions - has anybody put up the link to Compare Fund Platforms yet?