Online stockbrokers with lower ongoing fees

FDa65rdk

Hello

I have a stocks and shares ISA with Hargreaves Lansdown and I am now having to regularly top up my Fund and Share account and it's proving to be more expensive than I anticipated.

My understanding is that the Fund and Share account is a means of paying the broker's fees with external money rather than it being paid for by selling off parts of the portfolio.

Is that correct?

Can anyone suggest either an online stockbroker that has lower fees or a way in which I can compare the fees between different brokers so I can make my own decision?

Also, would it be difficult to switch my entire stocks and shares ISA portfolio to another online stockbroker if I decided to do so?

Many thanks.

eskbanker

FDa65rdk said:

Can anyone suggest either an online stockbroker that has lower fees

Most will be cheaper than HL!

FDa65rdk said:

or a way in which I can compare the fees between different brokers so I can make my own decision?

https://monevator.com/compare-uk-cheapest-online-brokers/

FDa65rdk said:

Also, would it be difficult to switch my entire stocks and shares ISA portfolio to another online stockbroker if I decided to do so?

It shouldn't be, but will depend on exactly what's in your portfolio and whether the receiving provider supports everything on a like for like basis.

FDa65rdk

FDa65rdk said:

Also, would it be difficult to switch my entire stocks and shares ISA portfolio to another online stockbroker if I decided to do so?

It shouldn't be, but will depend on exactly what's in your portfolio and whether the receiving provider supports everything on a like for like basis.

That's great, thank you so much!

I've had a look at the link and I want to make sure that I understand this correctly...

Of the flat-fee brokers, the Lloyds Bank Share Dealing fee is £40 a year regardless of the size of your portfolio... Is that right??

Someone could have literally millions in a stocks and shares ISA and only pay a £40 annual fee and an £11 fee on any purchases?

That seems extraordinarily cheap.

And of the percentage-fee brokers, Vanguard Investor has a maximum fee of £375 a year... Is that also correct?

Vanguard Investor apparently only accepts Vanguard investments, most of my HL portfolio is in a Fidelity S&P500 index fund.

Would it be possible to transfer the funds from HL into a Vanguard S&P500 index fund with Vanguard Investor?

Many thanks

eskbanker

FDa65rdk said:

I've had a look at the link and I want to make sure that I understand this correctly...

Of the flat-fee brokers, the Lloyds Bank Share Dealing fee is £40 a year regardless of the size of your portfolio... Is that right??

Someone could have literally millions in a stocks and shares ISA and only pay a £40 annual fee and an £11 fee on any purchases?

That seems extraordinarily cheap.

And of the percentage-fee brokers, Vanguard Investor has a maximum fee of £375 a year... Is that also correct?

You're certainly reading the information presented there correctly, but, as ever with third party sites, check what the actual providers say in their terms.

Another comparison site that helps lead you towards the most cost-effective platform for your anticipated trading profile is https://www.comparefundplatforms.com/

FDa65rdk said:

Vanguard Investor apparently only accepts Vanguard investments, most of my HL portfolio is in a Fidelity S&P500 index fund.

Would it be possible to transfer the funds from HL into a Vanguard S&P500 index fund with Vanguard Investor?

Vanguard's platform is known for only allowing investors to hold Vanguard's own products on it, so if you currently have a Fidelity fund at HL then you'd need to sell that if you wanted to transfer the proceeds and buy into Vanguard's equivalent.  However, it would generally make more sense to stick with a product you'd originally chosen (unless there are other reasons to change) and find the best platform for that, rather than being driven primarily by platform selection....

FDa65rdk

Vanguard's platform is known for only allowing investors to hold Vanguard's own products on it, so if you currently have a Fidelity fund at HL then you'd need to sell that if you wanted to transfer the proceeds and buy into Vanguard's equivalent.  However, it would generally make more sense to stick with a product you'd originally chosen (unless there are other reasons to change) and find the best platform for that, rather than being driven primarily by platform selection....

Thank you!

The S&P500 fund I have with HL is Fidelity Index US Class P - Accumulation (GBP) - BJS8SH1.

This is available through AJBell where the annual broker's fee doesn't exceed £875. There is also the fund manager's fee of 0.06% which would apply regardless of the broker.

If my maths is correct, the HL annual broker's fee could potentially go as high as £4000.

In fact, all but one of the funds in my HL portfolio is available through AJBell and that fund only makes up about 6% of the overall portfolio.

It seems like a no-brainer to sell this fund, use the proceeds to add to the Fidelity S&P500 fund (which is my favourite fund) and then transfer everything across from HL to AJBell.

What do you think?

jimjames

FDa65rdk said:

FDa65rdk said:

Also, would it be difficult to switch my entire stocks and shares ISA portfolio to another online stockbroker if I decided to do so?

It shouldn't be, but will depend on exactly what's in your portfolio and whether the receiving provider supports everything on a like for like basis.

Of the flat-fee brokers, the Lloyds Bank Share Dealing fee is £40 a year regardless of the size of your portfolio... Is that right??

Someone could have literally millions in a stocks and shares ISA and only pay a £40 annual fee and an £11 fee on any purchases?That seems extraordinarily cheap.

And with iWeb that would be zero cost annual fee but currently £100 to open it as one off fee. I have my ISA with them and no issues and yes it is very good value. iWeb is also part of Halifax/LBG.

Albermarle

Someone could have literally millions in a stocks and shares ISA 
As you can only add maximum £20K pa, it seems unlikely to ever get that big !

eskbanker

FDa65rdk said:

In fact, all but one of the funds in my HL portfolio is available through AJBell and that fund only makes up about 6% of the overall portfolio.

It seems like a no-brainer to sell this fund, use the proceeds to add to the Fidelity S&P500 fund (which is my favourite fund) and then transfer everything across from HL to AJBell.

What do you think?

It's unclear how you've structured your portfolio, but again I'd be wary of changing your allocation just to suit what's available on a different platform.  However, what sort of size of portfolio are we talking about?

FDa65rdk

Albermarle said:

Someone could have literally millions in a stocks and shares ISA 
As you can only add maximum £20K pa, it seems unlikely to ever get that big !

It's still possible - someone could invest all their money in one stock or fund that ends up being spectacularly successful.

I know it's highly unlikely but I used that hypothetical example to check whether the Lloyds annual fee would remain £40 regardless of the size of the portfolio.

FDa65rdk

eskbanker said:

FDa65rdk said:

In fact, all but one of the funds in my HL portfolio is available through AJBell and that fund only makes up about 6% of the overall portfolio.

It seems like a no-brainer to sell this fund, use the proceeds to add to the Fidelity S&P500 fund (which is my favourite fund) and then transfer everything across from HL to AJBell.

What do you think?

It's unclear how you've structured your portfolio, but again I'd be wary of changing your allocation just to suit what's available on a different platform.  However, what sort of size of portfolio are we talking about?

My HL fees are sufficiently more expensive than they would be with AJBell that switching to AJBell now seems a sensible thing to do.

I intend to continue adding to the portfolio so the benefit of lower fees from switching will only improve further with time.

If switching means that I will keep 94% of my current portfolio with the proceeds from the other 6% being used to increase my holding in my favourite fund then it seems beneficial in every way.