Interactive Investor to roll out ‘Netflix pricing’

Legacy_user

Interactive Investor to roll out ‘Netflix pricing’
https://www.ft.com/content/c9b7bd14-57b0-11e9-91f9-b6515a54c5b1

Lokolo

The article is blocked behind a paywall. Apologies FT for quoting this as I know you want to be paid.

Strange that ii have given this news to media, but I haven't heard anything as a customer yet.

The latest salvo in the UK’s increasingly competitive DIY investment platform market, Interactive said it would scrap its quarterly charges from 1 June in place of a monthly subscription model, with three different plans tailored to different kinds of customers starting at £9.99 per month.

The new model has three options — a £9.99 per month “core investor” plan for those trading shares, a £13.99 per month ”funds fan” plan for investors seeking trusts and funds, and a £19.99 “super investor” plan for frequent traders.

Active customers on the super investor plan will pay less than before, due to lower trading fees, but customers who trade less frequently stand to pay up to £30 more per year on headline fees on the core investor account, and up to £77 more on the funds fan plan.

Interactive Investor previously charged a £22.50 quarterly fee (£90 per year), which included trading credits of the same amount. The company also levied a flat trading fee of £10 for most customers, reducing to £6 for frequent traders who dealt more than six times in the previous month.

I currently pay £22.50 a quarter [edit = previously said month], and use most of my free credits to rebalance my SIPP once a year. Not sure I will enjoy this change and will most probably have to move away (only been there for 9 months, moving away from CSD after they increased their charges)

AnotherJoe

I think I'm just going to dump these jokers.

ColdIron

From CityWire

https://citywire.co.uk/funds-insider/news/interactive-hits-buy-and-hold-investors-with-new-monthly-fee/a1218870

mollycat

@Loloko.....think there is a typo in your post, like me you pay £22.50 a quarter rather than a month, yeah?

I use my trading credit to rebalance and occaisional buys/sells.

This is bad news for me, worse off

londoninvestor

Lokolo wrote: »

I currently pay £22.50 a month, and use most of my free credits to rebalance my SIPP once a year. Not sure I will enjoy this change and will most probably have to move away (only been there for 9 months, moving away from CSD after they increased their charges)

For your £10 a month on the cheapest new plan, you do get £8 of trading credit - but this will expire if unused after a quarter. (Currently trading credit lasts for a year, which is convenient for people like you and me who do most of their trading in an annual rebalance.)

Lokolo

mollycat wrote: »

@Loloko.....think there is a typo in your post, like me you pay £22.50 a quarter rather than a month, yeah?

I use my trading credit to rebalance and occaisional buys/sells.

This is bad news for me, worse off

Yes a quarter. Went off to the meeting and halfway there remembered what I had written, knew someone would point it out by the time I got back :rotfl:

londoninvestor

ColdIron wrote: »

From CityWire

https://citywire.co.uk/funds-insider/news/interactive-hits-buy-and-hold-investors-with-new-monthly-fee/a1218870

The spin in this article is more annoying than the actual changes!

O’Neill admitted the new tariffs would penalise customers who didn’t trade regularly. ‘Not everyone will feel better off. This is because the flat fee has increased, while trading fees have been cut across the board. So it is investors who most actively engage with and manage their investments who will benefit the most.’

Nice implication that I'm dumb and lazy for not trading frequently. What does the research say again about the impact of frequent trading on investment returns?

Research commissioned by Interactive from the lang cat, an investment platform consultancy, showed the company was cheaper than its main rivals. A person starting its Investor plan with £51,306 in an ISA, split equally between funds and shares, who added £10,214 a year to the account, would pay total charges of £4,795 over 30 years, assuming an annual investment return of 5%.

This compared to total charges over 30 years of £20,308 for AJ Bell Youinvest, £25,844 for Fidelity Personal Investor and £36,913 for Hargreaves Lansdown. The three are more expensive in this scenario because they charge a percentage of the balance held by investors in contrast to Interactive's flat fee.

While that's true, how about a comparison against other flat-fee platforms?

Lokolo

londoninvestor wrote: »

For your £10 a month on the cheapest new plan, you do get £8 of trading credit - but this will expire if unused after a quarter. (Currently trading credit lasts for a year, which is convenient for people like you and me who do most of their trading in an annual rebalance.)

Reading it that does not include funds (not really sure). The "Funds Fan" option is £13.99. My current cost of £7.50 a month seems to be going up £6.50 a month.

More details really need to be announced about the difference between the plans.

My company recently moved to a new pension provider who charge a set 0.15% platform fee. The platform is very basic, but does the job (Aegon).

I don't know if I will get charged to move my SIPP away due to the charges. ii do charge a transfer out fee for SIPPs <1 year.

LHW99

Haven't heard about this - not good news IMO, and having spent far too long getting everything over to II (not my fault guv!) I'm not looking forward to having to shift it all again.

TBC15

Joint accounts went now this, may have to give iWeb a good looking at shame about the restrictive No of funds.