A J Bell charges confusion

22225

I guess £12 is better than £18

Altior

The issue you have is that a platform provider needs to make a profit, and it costs the same to administer £25 trades as £250 trades, plus of course the administration of the LISA legislative requirements, and the cost to serve. 

£12 a year including 12 trades is very reasonable. 

It's not what the thread is about, but if you can accommodate it, increase your monthly deposits which will diminish the costs to you in percentage terms (while increasing your bonus). 

MisterMotivated

Could you save your monthly contributions somewhere else and then contribute to your LISA all at once?  Then you'd only have 1 or 2 trading charge per year.

22225

Yes thank u. I will try but I'm on a tight budget plus trying to get the mortgage down as it is partially on a fixed rate due to finish in 2 years. I did try to transfer the aj bell lisa into HL but they dont accept LISA transfers after 40 years of age. Oh well I suppose more incentive to increase the contribution. I don't know why I didn't realise before. I feel so thick. 

Sarahspangles

22225 said:

I've just looked at dodo but it still says there is a £1 minimum monthly charge. So not sure what to do.

Yes - it’s 0.15% or £1 whichever is higher.  These cover the costs of the provider - actually if you just put cash into an ISA the provider has costs, you just don’t see those as they knock them off the interest.

With small amounts invested the impact of these costs is magnified, as your pot grows they become less significant.  So minimise them until a different platform/account becomes more cost effective.

My son checked his reasoning with me about a decision between different ways to save a house deposit including LISA and in the end decided the main consideration was ensuring the top up, not what he’d be paying a provider.

Altior

22225 said:

Yes thank u. I will try but I'm on a tight budget plus trying to get the mortgage down as it is partially on a fixed rate due to finish in 2 years. I did try to transfer the aj bell lisa into HL but they dont accept LISA transfers after 40 years of age. Oh well I suppose more incentive to increase the contribution. I don't know why I didn't realise before. I feel so thick. 

It's not an uncommon misconception. That's actually the underlying reason for the Dodl product, marketed as a simplified solution (a simple £1 pcm minimum flat fee) where the costs are very easy to understand to the lay person. 

EthicsGradient

22225 said:

Yes thank u. I will try but I'm on a tight budget plus trying to get the mortgage down as it is partially on a fixed rate due to finish in 2 years. I did try to transfer the aj bell lisa into HL but they dont accept LISA transfers after 40 years of age. Oh well I suppose more incentive to increase the contribution. I don't know why I didn't realise before. I feel so thick. 

If you already have a mortgage, then I presume you must be using the LISA to save for retirement, since you can't withdraw from it without penalty before you're 60, apart from first-time buying. In that case, have you considered if the money would do better in your pension? (Exactly what is available to you as a pension depends on your employer, if you're self-employed, etc., but it can often be a better option).

22225

Sarahspangles said:

22225 said:

I've just looked at dodo but it still says there is a £1 minimum monthly charge. So not sure what to do.

Yes - it’s 0.15% or £1 whichever is higher.  These cover the costs of the provider - actually if you just put cash into an ISA the provider has costs, you just don’t see those as they knock them off the interest.

With small amounts invested the impact of these costs is magnified, as your pot grows they become less significant.  So minimise them until a different platform/account becomes more cost effective.

My son checked his reasoning with me about a decision between different ways to save a house deposit including LISA and in the end decided the main consideration was ensuring the top up, not what he’d be paying a provider.

Sorry please can you clarify. When u say 'minimise' do u mean do a lump sum instead of monthly? Whilst it's only £25 a month?

Sarahspangles

22225 said:

Sorry please can you clarify. When u say 'minimise' do u mean do a lump sum instead of monthly? Whilst it's only £25 a month?

More coffee needed (me not you).  I would minimise the costs of running the account by changing provider now, and then review at regular intervals e.g. yearly whether the arrangement still meets your needs. 

Your needs based on your original post include a wish to benefit from CPA, which implies taking a particular attitude to risk.  If you were interested in timing when you buy, then saving up cash in a LISA while you monitor the markets might make the mainstream AJ Bell account ‘right’ at this point, but that doesn’t sound like you right now?

Reviewing whether this product meets your needs, at regular intervals, is effectively what you’re doing now.  So you’re already doing better than all the people who don’t have time to do more research when they first invest and never make that time later and then realise with 20/20 hindsight they missed out…

cloud_dog

Hi all.... Just for clarity with starting off in S&S LISAs the cheapest option (assuming they all offer the investments you require) is:

• £0 - £4800 HL
• £4801 - £30k - Dodl
• £30k and above - HL* or AJ Bell (depending on number of transactions etc)

* - HL do not currently accept transfers in.