AJ Bell raising cap on shares custody charge

Alexland

Alz1986 said:

This company will charge you for breathing.

If you setup a regular breathing plan they charge a lower rate. It also helps average out the breaths to avoid taking a big gulp at a bad time. Still if you are in a position to take a big gulp then historically that has on average worked out better.

wmb194

Alistair31 said:

Alz1986 said:

This company will charge you for breathing. HL atleast have the decency to not charge you for transferring out.

YouInvest have dropped their transfer out fees. 

Cash transfers are and will remain free of charge but from January 1st the in-specie transfer fee per holding is being lowered from £24.95 to £9.95. This appears to be across the board but obviously people should double check.

garmeg

Alz1986 said:

This company will charge you for breathing. HL atleast have the decency to not charge you for transferring out.

Not as bad as it used to be.

Assuming you are referring to AJ Bell Youinvest, if you have 10 holdings the cost drops from £430 currently (assuming the two lots of £75 plus VAT apply, not clear about this, £340 if only one applies) to a more palatable £99.50 from January 1st.

bowlhead99

garmeg said:

Alz1986 said:

This company will charge you for breathing. HL atleast have the decency to not charge you for transferring out.

Not as bad as it used to be.

Assuming you are referring to AJ Bell Youinvest, if you have 10 holdings the cost drops from £430 currently (assuming the two lots of £75 plus VAT apply, not clear about this, £340 if only one applies) to a more palatable £99.50 from January 1st.

Formerly, only one of the £75s (plus £15 vat) would apply not both - as if you want to transfer out your pension portfolio you will either move it all to cash and do it wholly in cash (the first option in the table) or you'll be using the second option of transferring the pension 'in its actual form' (in specie) whereby you perhaps have some cash together with a bunch of other individual assets that must be re-registered to the new provider.

Going forward the basic transfer paperwork /computerwork is free if it's just cash, while if you want to transfer out individual assets as part of the process you will pay the same amount to re-register them out as they would have ordinarily have charged you to liquidate them (i.e. redeem open ended funds or sell shares in the market).

Giving the basics of the transfer process for free is welcome, but I can see why AJ Bell would want to keep something for the 'per investment' admin of closing out the individual lines of your holding. As that's no longer at punitive rates, seems fair enough.

Last summer when the FCA announced they were going to look closely at exit charges, Andy Bell said: “Firms incur specific costs when transferring clients assets and we believe we should have the ability to recover those costs from the clients involved rather than subsuming them within our general business costs, which would then inevitably be recouped via charges levied on all clients regardless of activity". 

On HL's model where they now boast that they won't charge anything for transferring out the individual lines of a holding in specie - of course HL can pretty much afford to let you you do as many fund sales or transfers out for free as you like, because they've already agreed with you to charge almost twice as much on a percentage basis for holding the fund assets, with the understanding that you can do unlimited subscriptions and redemptions. So at HL, people who don't do many subscriptions or redemptions or transfers out will simply subsidise those that do.

The FCA have dropped their exit fee work for now, given the 'direction of travel' in the industry has been good enough.  As providers are generally falling all over themselves to do the work of customer onboarding and setup for free (essentially a marketing spend paid for from ongoing customer revenues of the whole client base) I don't begrudge a transfer out cost if there is some actual incremental work to be done that can be charged to the customer that causes it rather than being charged to the customers as a whole. It fits ok in a 'pay for what you use' model.

Alexland

bowlhead99 said:
The FCA have dropped their exit fee work for now, given the 'direction of travel' in the industry has been good enough. 

I don't think anyone told Jarvis XO given their sneaky new JISA closure fee added without notification this year.

bowlhead99 said:
As providers are generally falling all over themselves to do the work of customer onboarding and setup for free

Apart from iWeb who are upping their setup charge. Their SIPP is now very unattractive with high setup, ongoing and drawdown charges.

bowlhead99 said:
I don't begrudge a transfer out cost if there is some actual incremental work to be done that can be charged to the customer that causes it rather than being charged to the customers as a whole.

Problem is that it's still a barrier to competition and doesn't give the provider an incentive to deliver a really good service to avoid exit costs. There would be outcry if bank accounts started charging for switching out. Why should it be different for investment accounts?

csgohan4

Alexland said:

bowlhead99 said:
The FCA have dropped their exit fee work for now, given the 'direction of travel' in the industry has been good enough. 

I don't think anyone told Jarvis XO given their sneaky new JISA closure fee added without notification this year.

bowlhead99 said:
As providers are generally falling all over themselves to do the work of customer onboarding and setup for free

Apart from iWeb who are upping their setup charge. Their SIPP is now very unattractive with high setup, ongoing and drawdown charges.

bowlhead99 said:
I don't begrudge a transfer out cost if there is some actual incremental work to be done that can be charged to the customer that causes it rather than being charged to the customers as a whole.

Problem is that it's still a barrier to competition and doesn't give the provider an incentive to deliver a really good service to avoid exit costs. There would be outcry if bank accounts started charging for switching out. Why should it be different for investment accounts?

Fidelity are probably cheapest for SIPP for ETI only,  but their Uk only shares is a deal breaker

DisablednProud

Is this for index funds too?

masonic

DisablednProud said:

Is this for index funds too?

If you are holding index funds (other than ETFs), the existing fees of 0.25% for the first £250k, then 0.1% for the next £750k, etc, will still apply.

cloud_dog

I bet SnowMan is sat at the kitchen table rocking back and forth, muttering "no, not charges".

janeskips2

Is there a cheaper alternative for foreign shares? None of the platforms with low currency commission geared toward international trading provide SIPP or for that matter ISA. iweb and ii have cheaper fees for UK shares and funds but they charge 1.5% for each currency conversion where AJ Bell is only 1%.