Cheapest Lifetime ISA all world ETF

toothdoctor

Myself and my wife have LISA's with AJ bell. Maxed out contributions since it's inception so we are at that point investing in funds is getting expensive, we have decided to switch to ETFs for platform charge capping. I just wish AJ bell would introduce fractional ETF investing so that you could invest the full allowance in. I'm hoping platforms like Invest Engine or Trading 212 will introduce  a LISA and allow transfers in to take advantage of fraction buying of ETFs which these platforms allow.

masonic

toothdoctor said:

Myself and my wife have LISA's with AJ bell. Maxed out contributions since it's inception so we are at that point investing in funds is getting expensive, we have decided to switch to ETFs for platform charge capping. I just wish AJ bell would introduce fractional ETF investing so that you could invest the full allowance in. I'm hoping platforms like Invest Engine or Trading 212 will introduce  a LISA and allow transfers in to take advantage of fraction buying of ETFs which these platforms allow.

There are very few ETFs with very high share prices, so it is unlikely that you'd have problems investing all but a few pounds. It tends to be useful to have some cash on account to cover fees, which is better done on money that has earned a bonus. As things stand, fractional shares are not a qualifying ISA investment anyway.

ispookie666

I have been investing in LGGG through invest-engine with an ongoing fees of 0.10

toothdoctor

You can do fractional investments in invest engine. On an bell the price of VWRP today is 100.06. So if you invest 4k, that would get you 39.97 units. You can only get 39 units so this will cost you 3902.34 so you will have 97.66 languishing in the account uninvested. The bonus is 1000 quid, assuming this is bought at the same price (unlikely) then you would buy you 9.99 units. You can only get 9 units. 9 units would cost 900.54. So you would have an additional 99.46 in the account uninvested. Total unnvested would be 197.12. You could by 1 more unit but at £5 a purchase is a high price to pay

gravel_2

ispookie666 said:

I have been investing in LGGG through invest-engine with an ongoing fees of 0.10

Also hold this but it's not all world. Developed, large and mid cap only.

FIREmenow

Do you regret not starting with ETFs simply because of the "hassle" of selling your fund and buying an ETF despite the savings you made? 
Or is there a financial reason for the regret?

Beyond hassle, the psychological effect didn't feel worth it worrying about being out of the market. Having to psych myself up to do it when doing nothing was an option. Perhaps I'll feel it was a useful learning experience when I look back, as it's the first time I've sold to switch investments rather than to cash out.

The reason I didn't start with an ETF was that I didn't know as much about them, rather than cost. Going forward, the increased fund charge should be offset by the capped platform fees quite quickly.

Some good returns have also meant the time to cap fees came a lot quicker than I expected (not complaining!).

So with beautiful hindsight I should have invested in an ETF even though I hadn't got to grips with them and justified it by predicting optimistically-high annual returns! 

FIREmenow

toothdoctor said:

 You could by 1 more unit but at £5 a purchase is a high price to pay

If you buy ETFs using regular investing it is £1.50. The buying date is set at 10th each month or next working day after, so you'd need to plan around that. Then cancel the regular instruction after it's gone through.

This rule has changed in the past week, and I now plan to use DODL for the first few years.

Minimum platform fee of £12 means equivalent percentage rate of the first year is 0.24% and they don't pay interest on cash balances, but they have the HSBC fund so should be better than AJ Bell up to about £27k.

mugston said:

Do most investors find holding their LISA, ISA and SIPP all with the same broker helps to reduce fees (as we reach limits faster)?

I'm across four platforms. There's not much choice with LISAs or fee-free JISAs, and I have two ISAs doing a version of the ISA hack from Monevator. Currently with iWeb and ii (fees offset with cashback). Next year I might use Dodl to buy and then transfer to iWeb now that I know I can get a global equity tracker cheaper than at Vanguard.  Planning to transfer a work pension into a SIPP soon so that might change things with the slightly different fees SIPPs tend to have.

kempiejon

I built a global vanguard ETF portfolio with lower costs than VWRL/P. I made it exUK as I hold FTSE350 shares directly.
Vanguard Emerging Markets, VFEM
Vanguard Europe exUk VERX
Van Japan VJPN
Van Asis exJapan VAPX
Van S&P500 VUSA

Look at the global VWRL region weighting and you'll see that VWRL= 50% VUSA plus 10-15% in the others. I think USA has been a higher percecntage. Those are all distributing ETFs as I want to take the income out.

mugston said:

I want to start a Lifetime ISA.

It will be very simple - one deposit of the maximum £4k each year, into a cheap diversified all world ETF such as VWRL.

Who can I do this through with the lowest fees?

Thanks.

If I was starting with the OPs intention and not wanting several smaller holdings a split 90% developed world accumulating VHGL (charge 0.12%) 10% emerging VFEA (charge 0.22%) would be a good approximation. about half the OCF

FIREmenow

Thinking of putting future funds in FWRG as it seems to be growing well. 0.15%