Move from Moneyfarm due to fee rise?

letsbetfair

I've got about £7k in a Moneyfarm ISA. It's in a fairly high risk portfolio (number 6 of 7) as I shouldn't want to spend the money in the next 5 yrs and it will be for 'nice to have' stuff not essentials. Moneyfarm have upped the platform fee they're charging me from 0% to .75% (fees detailed here https://www.moneyfarm.com/uk/pricing/). I'm thinking of switching to somewhere like Vanguard or Open Money - in the hope of getting similar but with lower fees.
Does that seem sensible? I've lost ~£500 on this investment - my timing was terrible! - and I know the markets are volatile at the moment, so I'm also not sure whether to just move the money now or wait till things calm down.

Albermarle

According to the link , if you have less than £10K the total charge is slightly over 1 % ( presume 0% was an introductory offer) 
Vanguard would seems as good an option as any for this amount of money and if you are happy with one of the Vanguard funds they offer. Total cost will be less than 0.5% , exact saving will depend on which fund you choose.
and I know the markets are volatile at the moment, so I'm also not sure whether to just move the money now or wait till things calm down. 
Problem here is nobody knows when they will calm down, maybe they already have ?
In any case only the transfer period when you are out of the market is the issue and it is 50;50 whether you win or lose in that period anyway.

Alexland

I remember when Moneyfarm introduced their new fee structure in late 2017 they said that existing investors would still get a 0% fee on an account balance of up to £12k. I'm guessing they have written to you to say that is no longer the case? Or was it an investement under the new fee strucutre where they waived their fees for a number of months? Are you still tied in for a minimum term under a promotional cashback deal?

Are you still contributing into this account or is it a static investment? Are you sure that a S&S ISA meets your needs or would you be better putting money into a Lifetime ISA (if under 40) or making higher pension contributions?

letsbetfair

Thanks. That's right - I was getting 0% fees as an existing investor, but Moneyfarm stopped that Would Vanguard be a sensible option (as opposed to Open Money)? I'd want to leave the money for them to manage.
It's a static investment for now. I have a £1k/month pension DC AVC at the moment rather than paying more into an ISA, though if I have spare cash later this tax year I may put more in an ISA.
I'm 40, so can't open a lifetime ISA (should have, but didn't get round to it). I'd like to keep some money invested so I can spend it in my later 40s, anyway

Alexland

Well the platform fee on Vanguard (one of the world's biggest and most secure asset managers) would be 0.15% which for £7k would be £10.50 pa and your current Moneyfarm portfolio 6 is 70% equities which is mid way between the Vanguard LifeStrategy 60 or 80 funds. You could always put 70% in the Vanguard Global All Cap fund and 30% in their Vanguard Global Bond Index Hedged fund if you wanted to maintain a similar asset allocation then rebalance once or twice a year (as trade costs are free on Vanguard).

If it was a static investment I would have suggested iWeb at £25 setup and £5 per trade with no ongoing charges. It depends how often you are likely to invest new money as to which would be cheaper.

letsbetfair

Thanks! I could potentially invest via iweb and put any spare cash I'm investing in a non-ISA investment with Vanguard - and just move across to iweb when I've got a couple of thousand? I guess it's partly how much effort it's worth for the savings!

Vanguard 80 on its own would be a slightly higher risk investment than my current plan? That would likely be ok - my mortgage is a fair bit smaller now than when I invested with Moneyfarm.

Albermarle

I guess it's partly how much effort it's worth for the savings!

Probably better to let it build up to a bigger amount . Not all these transfers run smoothly/quickly so best not to do them too often but its a personal choice

letsbetfair

Good point. Might be worth paying a tenner or so a year to save potential hassle