Negotiating lower platform fee with Hargreaves Lansdown

A_T

eskbanker wrote: »

In the absence of any reports of anyone actually succeeding in doing this (in recent years), that's just more hypothesising, and it's perhaps worth bearing in mind that, according to https://www.hl.co.uk/about-us:i.e. the average balance is about £75K and so the notion that a SIPP of £250K makes the holder a major player with influence and clout is somewhat unlikely!

No but the sales team may well have guidelines with what to do when someone phones them and asks to leave. On the other hand they might not.

kangoora

Everyone on this thread is guessing or arguing about what would be the 'minimum' to achieve a discount (with the exception of a couple of historical anomalies).

It's like asking how much of a discount will I get on a new car purchase - the answer is..................... ask the car seller.

The easy answer is for someone with £250k ask HL (ideally with an existing HL SIPP) for a discount and see what the answer is. I can't be bothered

sebtomato

kangoora wrote: »

Everyone on this thread is guessing or arguing about what would be the 'minimum' to achieve a discount (with the exception of a couple of historical anomalies).

Well, the point of the thread was to get examples of people who have been through the process and whether it had been successful.

To take your car example, you can indeed ask for a discount, but it's nice to know people got a 5% discount or didn't get anything at all, so you know where to stand...

bowlhead99

sebtomato wrote: »

Or could you look at it the opposite way:

[etc]

Same applies to salaries/income in the UK.

Yes you could imagine that the median customer has £5k and therefore you would hope to be treated like one of the kings rather than one of the serfs if you had 50x that amount. But probably won't be the case.

The fine detail of account balances across the customer mix is not going to be released by HL because they don't want to give customers or rivals this detail. So, we can only use 'rules of thumb' by dividing high level stats by each other. Still, they give an indication

For example in the UK, median household disposable income last financial year was £29,400, while mean household disposable income was £35,300. We might like to think that most households have much less than the mean average because there will be football stars or FTSE CEOs making millions, and the '1 percenters' dragging that mean average up way higher than the common man; but actually the numbers are quite close and if you bring in £60-70k you would be 'about double' the average whether you're using mean or median.

So it is probably the case that if you are holding a £250k pension on platform you are not particularly special (i.e. not 50x what the normal people hold); you are still the same order of magnitude as that £75k which eskbanker suggested. However we do know that HL use £250k as a threshold for tapering down the percentage fee and that a lot of customers won't get anywhere near that threshold; so you could imagine that if you have already reached the threshold and are paying £1k a year in fees, you are one of the bigger customers.

Enough for a further discount? To stop the thread just going round in circles, the best thing to do is for you to try to negotiate one and let us know how it works out - not just keep debating with people here whether or not you should be entitled to get one or could realistically get one.

Maybe a major player would be someone with "only" £1M anyway, as any bigger customer wouldn't use HL as a platform anyway.

Well, chucknorris mentioned he has £3m on platform; but he is doing that with exchange-traded instruments that don't incur the ad valorem platform fee... so would not be a 'big customer' in terms of revenue from him, but may be an attractive customer in terms of them seeing the £££ in his account and hoping that one day they could monetise some of it.

sebtomato wrote: »

Well, the point of the thread was to get examples of people who have been through the process and whether it had been successful.

Its conclusion so far is that nobody has successfully been through the process recently, although people had successfully been through the process five years ago when HL significantly changed their fee structure. As there isn't currently a particular catalyst to demand a better price (e.g. no recent adverse change to the fee structure), they are unlikely to be handing out discounts like candy.

This doesn't stop you asking for one. This is an MSE site after all. If you don't routinely ask for a better price for things you buy, you are not really an MSE. As there are plenty of other providers with alternative price structures there is no harm in asking for a discount and moving if/when you don't get one.

sebtomato

bowlhead99 wrote: »

Enough for a further discount? To stop the thread just going round in circles, the best thing to do is for you to try to negotiate one and let us know how it works out - not just keep debating with people here whether or not you should be entitled to get one or could realistically get one.

This thread or me asking for a discount are not mutually exclusive. I just wanted to know where to stand and what other people's experience has been. I guess that's the point of this forum, people to share experience, no?

So far, nobody has come forward with recent examples, so either HL never negotiates, or does negotiates with some NDAs.

I will contact and negotiate with HL regardless (and you may never hear from me again on this subject if one of my assumptions above is true)...

Feel free not to take part in the discussions if you have no examples to share and the debates/speculations don't interest you. Participation is not compulsory!

bowlhead99

sebtomato wrote: »

I will contact and negotiate with HL regardless (and you may never hear from me again on this subject if one of my assumptions above is true)...

I guess the way for us to find out their attitude will be to add a post to this thread enquiring "are you able to tell us what happened when you asked about a lower fee"...

sebtomato

I think the argument that "no large company can give discounts to specific customers in order to avoid setting a precedence, social media etc." or "losing a single customer doesn't matter for a large company" are a bit over estimated.

I have received discounts from BT for instance, by just asking and it took 10 minutes to get to the price I wanted (after rejecting 2 less interesting proposals). It doesn't mean the vast majority of their customers will know about it, will have the same circumstances anyway or will be bothered to ask.

Brian65

So called 'disposable income' statistics are meaningless when they don't include rising rent or mortgage repayments. Which I guess it why shoppers are spending less, although the Governments synthetic statistics show their incomes are rising.

bowlhead99

Brian65 wrote: »

So called 'disposable income' statistics are meaningless when they don't include rising rent or mortgage repayments. Which I guess it why shoppers are spending less, although the Governments synthetic statistics show their incomes are rising.

Trends on what people are spending in shops vs spending on rent or property or whether ONS are helping Government's propaganda through dissemination of meaningless statistics, is probably off topic on a HL fee negotiation thread, and instead something for the debate the economy board.

The reference above was nothing to do with trends or government misinformation - it was simply to show that mean and median may not be massively different even though a lot of people commonly think that the mean will be hugely dragged up by outliers at the top end of the scale. For salaries/income in the UK, which Seb had mentioned as an example, in the context of large vs small HL clients, mean above median is only about a 20% differential, whether you look at the ONS 'disposable income' stats or if you consider those meaningless, their 'gross earnings for specimen families' etc.

kinger101

sebtomato wrote: »

Well, the point of the thread was to get examples of people who have been through the process and whether it had been successful.

To take your car example, you can indeed ask for a discount, but it's nice to know people got a 5% discount or didn't get anything at all, so you know where to stand...

The problem with this is even if they are permitted to negotiate, you don't know who'll be on the end of the phone at HL, and what mood they're in. If it's a pragmatic person in a good mood, maybe you'll be lucky. Assuming you're a customer whom they value. Call five seconds later, and you might get someone who won't budge an inch.

You have three options;

(a) ask for the discount;
(b) go somewhere else;
(c) use ETFs instead of OEICs.

But unless you're approaching a seven figure sum, I suspect they'll say no. For one, the risk already highlighted of you telling other people. And two, each interaction they have with you costs them money. If they perceive you'll be a difficult customer, they'll be happy to see the back of you.