S&S ISA - Platform Fees

badger09

Malibusmash wrote: »

I have a S&S ISA worth £122k currently in Vanguard LS80 (I've just transferred other years in from a Cash ISA).

Because of the FSCS £85k limit on VG, I'm now looking to transfer £60k out to another S&S ISA and am hoping for some of your opinions on which might be the best platform to go with according to my circumstances.

As I am very much a 'Buy-and-Hold investor', I am conscious of fees and am wondering if a flat £ fee would be better than a % fee - what are your thoughts on this based on the amount of £60k?

I love VG and their LS series (both site and funds so easy to understand and low fees); if I were to invest in another VG fund but through another platform (eg. IWeb), would I be covered for another £85k by the FSCS on IWeb (even though I'm still investing in VG via IWeb)?

I'm 52 years old and won't be touching my S&S ISA until my late 60's.

making no comment about your choice of funds, or FSCS coverage, which others have addressed....

If you want to stick with your VLS 80 holding in S&S ISA, you would save a substantial amount in fees by transferring some/all of it to IWEB. One off £25 account opening fee, £5 per trade, but no ongoing platform fees.

If you drip feed your ISA allowance, you could keep your current year ISA with Vanguard, transfer previous year's subscription, then transfer this year's subscription after 5th April. Rinse & repeat:)

Aylesbury_Duck

badger09 wrote: »

If you drip feed your ISA allowance, you could keep your current year ISA with Vanguard, transfer previous year's subscription, then transfer this year's subscription after 5th April. Rinse & repeat:)

This is what I'm considering. I have around £55k in VLS60 on the Vanguard platform, to which I'm drip-feeding my £20k annual allowance. It would seem sensible to open an iWeb account, transfer across the current £55k into VLS60 on that platform and continue drip-feeding my monthly sums into the Vanguard platform. Does that make sense and does it comply with the rule about only investing in one S&S ISA in the tax year (I opened the Vanguard platform account in 2018-19)?

Albermarle

In this case, is a % based fee still most appropriate?

The smaller the sums involved the cheaper will be a % based charge than a flat fee charge as a general rule .
As mentioned above there are a couple of bargain basement platforms , like IWeb , that are cheaper than nearly all the others regardless of the sums involved.
Why not just have a look at the various platforms and see what you think.

badger09

Aylesbury_Duck wrote: »

This is what I'm considering. I have around £55k in VLS60 on the Vanguard platform, to which I'm drip-feeding my £20k annual allowance. It would seem sensible to open an iWeb account, transfer across the current £55k into VLS60 on that platform and continue drip-feeding my monthly sums into the Vanguard platform. Does that make sense and does it comply with the rule about only investing in one S&S ISA in the tax year (I opened the Vanguard platform account in 2018-19)?

It doesn't matter when you opened your S&S ISA on the Vanguard platform. What does matter is whether you have paid any new money into it since 6th April 2019.

The rule is that all current year subscriptions must be kept together.

So, as you have paid money in since 6th April, you can't transfer all of your £55k to IWEB unless you want to pay the rest of this year's allowance into IWEB.

You can however, transfer all previous year's subscriptions to IWEB and carry on paying this year's allowance into Vanguard. Then, after 5th April, transfer all of this year's subscription over to IWEB.

Aylesbury_Duck

Thank you. I'd missed that nuance to my situation.

HCIMbtw

just to add, £20k in a vanguard ISA is the around the breaking point between platform fees and making sense to switch to iweb

vanguard makes sense for drip feeding for sure given the lack transfer charges

If it was my £120k i'd switch almost all of it to iweb and maintain monthly debits into the vanguard platform until it builds up

Malibusmash

I am just about make the transfer from VG to iWeb (minus current year's ISA money) and wanted to check a couple of things with you please before I hit GO:-

a) Does this mean that VG need to 'sell' my stock in order to transfer to iWeb? In other words, am I better off hoping/waiting for the market to improve?

b) Does the amount that I want to transfer (minus current year's money) include any gain I may have made or do I need to keep that portion in VG?

c) Same question as above for current year's money = £20k but it has made a slight gain, do I need to leave just the £20k in VG as 'current year's money' or transfer the £20k plus the gain?

d) Albeit in a different layout I presume, does the iWeb (logged in) page give you pretty much the same overview info. as VG does, eg. Value / Return / Gain or Loss?

SonOf

a) Does this mean that VG need to 'sell' my stock in order to transfer to iWeb? In other words, am I better off hoping/waiting for the market to improve?

If you are doing a cash transfer then they will be sold and a cheque sent to the new platform to invest in the funds of your choice.
If you are doing a re-registration or in-specie transfer then the investments will not be sold.

b) Does the amount that I want to transfer (minus current year's money) include any gain I may have made or do I need to keep that portion in VG?

If you are doing a partial transfer then you need to state how much. This may prevent an in-specie transfer being available. Although some may allow you to select the number of units to transfer.

c) Same question as above for current year's money = £20k but it has made a slight gain, do I need to leave just the £20k in VG as 'current year's money' or transfer the £20k plus the gain?

This year would be transferred in full.

Remember that you are not transferring an allowance. You are transferring amounts. The allowance only comes into play when making a contribution. What the value goes on to after that is irrelevant apart from the current year and previous years split for administration purposes.