Fidelity stocks and shares isa charges

Markp1984

Hi everyone, I just want to preface this post by saying I'm in a rather delicate position after escaping a psychologically abusive relationship last year, so please be gentle as I'm very prone to panic and depression. Thanks for your understanding.
I recently added a thousand pounds to my stocks and shares isa, now with fidelity (was with Cavendish), thought I'd give their service a try. 
The process was OK, although rather than investing the whole 1k it only bought whole shares leaving me with £70ish stuck in cash in the isa.
After this I went and had a good read, unlike what I was told by Cavendish and fidelity about fees this spring(to be kept at Cavendish 0.25 percent for at least a year), it seems that there's a bit of a catch, according to a pdf I found, fidelity will be charging me a £45/year investment fee on top of that. I have a mere £1850 invested with them in total,so this charge works out around 2.5 percent a year!
The questions :

should I just stick it out with fidelity, should I be looking to invest more with them so the charge isn't as higher portion of my money?

What about that uninvested 70 quid that's held as cash, I've read up and it'll be used for fees first, but it seems a bit wasteful to me. 
My situation:
I'm in my mid 30s, I've got an old stocks and share isa worth significantly more with jupiter from about 2007, plus various rainy day/easy access savings like premium bonds. 
Thanks, I've got myself into a state about this, so I'm grateful for your help. 

grumiofoundation

From link below -Fidelity charges minimum £45 a year unless you have a regular savings plan. Then fee become 0.35%.

So if you set up a regular savings plan you can mitigate this? E. G. £25 a month (£25 is minimum from 2nd link below). 

https://www.fidelity.co.uk/services/charges-fees/fees-more-detail/#tab-link

https://www.fidelity.co.uk/planning-guidance/regular-saving-benefits/

Markp1984

Unfortunately I cant add links but if you Google fidelity Cavendish you'll find the notification of sale and a brief list of the terms below it "what does this mean for you as a customer". 

Thanks grumiofoundation, So my isa is called a Cavendish isa, this last week is the first time I've actively used fidelity, according to the link above am I right in saying I don't have the £45 to pay?
Looking at your suggestion of paying in 25 a month, won't I end up incurring lots of investment charges?
Thanks so much, Mark

Markp1984

Here's a quote from the fidelity helpful topics fees and charges section:

"2. An Investor Fee

This is a flat annual charge of £45 per annum which 

from the 1st September 2020 we will collect in 

monthly instalments of £3.75. Previously we have 

collected this fee in two instalments of £22.50 every 

6 months. This fee is typically collected from cash or 

by selling units or shares from your investments. 

You will pay one Investor Fee for all accounts in 

your sole name, no matter how many there are. You 

will also pay the Investor Fee for each unique set of 

names that you have a joint account in. 

For example, if you have six accounts (three in your 

sole name, two joint accounts with your spouse and 

a joint account with your child) then you pay:

• One Investor Fee of £45 on your sole accounts

• One Investor Fee of £45 on your joint accounts 

with your spouse

• One Investor Fee of £45 on your joint account 

with your child

The Investor Fee is non-refundable and charged 

six-monthly in advance. The Investor Fee is normally 

taken from the Cash Management Account. 

If there is not enough cash in the Cash Management 

Account to pay a fee, then you can choose which 

account we look to take fees from, or else we will 

look in the the largest Investment Account, then the 

next largest and so on, followed by the largest ISA 

and finally the FundsNetwork Pension. 

If there is not enough cash in an account to pay 

a fee, then we will sell some of your client’s 

investments in the same way as for the Service Fee"

Alexland

Markp1984 said:

The process was OK, although rather than investing the whole 1k it only bought whole shares leaving me with £70ish stuck in cash in the isa.

Buying individual shares isn't economical with a small account valuation due to the £10 trading fee multiplied by the number of different companies you would need to buy to achieve any level of diversification. Suggest you stick to fund(s) for which there is no trading charge and you can invest exactly the amount of money you want although best to leave a small cash balance to pay the Fidelity ongoing fees.

Markp1984 said:

I'm in my mid 30s, I've got an old stocks and share isa worth significantly more with jupiter from about 2007, plus various rainy day/easy access savings like premium bonds.

Have you considered transferring the old Jupiter ISA into Fidelity for more choice and likely lower costs?

Also have you considered additional Pension or S&S Lifetime ISA contributions for government tax/bonus incentives?

Markp1984 said:

Looking at your suggestion of paying in 25 a month, won't I end up incurring lots of investment charges?

Yes if you continue to invest in shares although the Fidelity share trading rate reduced from £10 to £1.50 on a regular saving plan it's still not worth it however a regular savings plan into fund(s) there would be no trading charges. Invest in fund(s) not shares. Fidelity is a very good platform if you use it carefully.

Markp1984

Alexland said: 

Have you considered transferring the old Jupiter ISA into Fidelity for more choice and likely lower costs?

Also have you considered additional Pension or S&S Lifetime ISA contributions for government tax/bonus incentives?

Thanks so much Alex for your detailed reply.  Extremely kind. 

That's actually a really great idea regarding transferring my jupiter isa over, it's quite diverse, but I've checked and all the investments in it are available with fidelity. Do you know the easiest way to compare the fees?

Generally I invest in my pension(with Scottish widows) for the 20 percent tax relief or premium bonds for easy access, this time however i fancied doing something different

Alexland

Markp1984 said:

That's actually a really great idea regarding transferring my jupiter isa over, it's quite diverse, but I've checked and all the investments in it are available with fidelity. Do you know the easiest way to compare the fees?

Usually if you invest directly with the fund manager they will have a Retail class of fund unit which has a higher ongoing charge to cover the cost of providing the ISA and customer service wrapper. But if you invest in the same fund via a platform they will have a Standard or Institutional class of fund unit to reflect the reduced fund manager work. Some platforms offer multiple fund classes to support people who want to transfer in existing investments so check for the cheapest one. They will usually have a letter in the name to designate the class such as R, I, etc.

The terminology varies between fund manager but the comparison is if the OCF of the Standard or Institutional fund class available on Fidelity plus the 0.35% Fidelity platform fee is cheaper than the OCF of the Retail fund class available direct from Jupiter. But if you chose the Jupiter investments such a long time ago they are highly unlikely to be what you would choose now so might be worth a review of other funds anyway. There are now some extremely low cost passive funds that do a really good job of capturing market returns.

Markp1984 said:

Generally I invest in my pension(with Scottish widows) for the 20 percent tax relief or premium bonds for easy access, this time however i fancied doing something different

If that's a workplace defined contribution pension then it's still worth making sufficient contributions to get the maximum employer matching however for additional contributions if you are a basic rate taxpayer it might be more efficient to use a S&S Lifetime ISA as it provides the same initial uplift (25% bonus = 20% tax relief) but with a Lifetime ISA there is no tax on withdrawal from age 60. Some of the pension may be subject to income tax on withdrawal. Still if your employer operates Salary Sacrifice to also save the National Insurance on pension contributions it works out about the same. For a low cost S&S Lifetime ISA investing in funds have a look at EQi.

https://www.gov.uk/lifetime-isa

Hopingforthesimplelife

Hi Mark, I can’t add anything more than what the other posters have but actually your post caught my eye as a fellow cavendish turned fidelity customer - I thought all cavendish charges were frozen for a year but your post and the replies seem to indicate not? 

If this is the case I have about £20k and make a small regular contribution so maybe I need to look at other platforms (hoped that could be a job for next year once Fidelity’s. new charges came in)

Markp1984

Hopingforthesimplelife said:

Hi Mark, I can’t add anything more than what the other posters have but actually your post caught my eye as a fellow cavendish turned fidelity customer - I thought all cavendish charges were frozen for a year but your post and the replies seem to indicate not? 

If this is the case I have about £20k and make a small regular contribution so maybe I need to look at other platforms (hoped that could be a job for next year once Fidelity’s. new charges came in)

I'm baffled by it as well, I have no idea which rate I'll be paying. I've read lots and I seem to find contradictions. Very frustrating. Thanks for replying, let me know how you get on. 

Markp1984

Excuse bumping this up but here's the info for any other Cavendish customers that have been switched to fidelity. After speaking to them it turns out we are on the same charges as Cavendish, no extra fees of £45/pa and/or higher percentages. We're on the same 0.2 percent as ever with Cavendish. The earliest this will change is late 2021,and if it does we'll the information in writing 30 days before hand. 
Hope that's of use. Mark. 

Albermarle

As a customer of Fidelity Personal Investing I have never heard of this Investor charge , although I know there is a minimum charge of £45, unless you are a regular investor.
I reread the original post and I noticed this '  the FundsNetwork Pension. ' I think this is the Fidelity pension used by advisors , which seems to have a different charging structure . Hence the confusion.