Junior S&S ISA Questions

Lifes_Grand_Plan

Hi folks,

I've been saving for my daughters since they were born. Originally it was in a Cash ISA for them which I quickly realised wasn't going to earn them the best gains long-term so I started putting it in a S&S ISA in my wife's name (we already have once for wife and I in my name).

I'd like to start putting it into Junior S&S ISAs in their names - so as not to use my wife's ISA allowance and also we're gifting the money to them so its better if its in their name in the long run.

So anyway I'm thinking of going with HL due to them not having fees. But once they hit adulthood, will HL sting them for mega fees (i.e. is this "no fees" thing a honeypot to bring them in with a later sting in the tail?)

Also the Cash ISAs that I started for them 7 and 12 years ago (since moved around for better rates) - can these be moved into HL S&S ISA or does a cash ISA have to stay a cash ISA?

TIA

eskbanker

When they reach 18 the JISAs will convert into standard adult ISAs - if they don't like the HL fees for adult ISAs then they can be transferred elsewhere.

Cash JISAs can be transferred to S&S JISAs, using the receiving provider's ISA transfer process, but it isn't possible to transfer any type of ISA from one name to another, so if the money is still in an adult's name then it would need to be withdrawn and paid into JISAs as new money, subject to the annual allowance.

Albermarle

Although HL have the highest fees of the mainstream investment platforms, I would not call them 'mega' .
They charge 0.45% on the funds you have on the platform for standard OEIC funds ( which is what most people invest in )
Are you aware that although there are no platform fees for the JISA with HL, the investments you hold in the JISA or S&S ISA have their own fees? This is the same for all providers. If you pick expensive investments it will wipe out any gains from zero platform fees. 

Lifes_Grand_Plan

Albermarle said:

Although HL have the highest fees of the mainstream investment platforms, I would not call them 'mega' .
They charge 0.45% on the funds you have on the platform for standard OEIC funds ( which is what most people invest in )
Are you aware that although there are no platform fees for the JISA with HL, the investments you hold in the JISA or S&S ISA have their own fees? This is the same for all providers. If you pick expensive investments it will wipe out any gains from zero platform fees. 

Thanks mate. My personal S&S ISA is invested in ETFs so I'm intending on doing the same for the kids. Fees with HL are the same as with my Invest Engine account and very low so I'm happy with that.

Lifes_Grand_Plan

By way of update for anyone else looking at a Junior S&S ISA, I eventually opened with HL and have to say i'm very unimpressed compared to my own account with Invest Engine.

Invest Engine was my first foray into the world of S&S ISAs and I must've got very lucky because they seem light years ahead of HL who I thought would be on it as (what I thought to be) a big player in the investing world.

So my observations:
- Perhaps its just because i've been using Invest Engine for a while already but I find their website was nice looking, and way easier to use than HL.
- I wanted to pay £100 a month into my kids accounts and then auto-invest that into my chose ETFs. Doing that on IE was a cinch compared to HL where you have to ring them and request the auto investment, or print and complete a paper form and return to them. WTH is that all about.
- Finally, and this is my error for not checking but I assumed it was the norm now, HL won't allow partial shares which I thought was common now since IE offer this and it works really well. So after jumping through their hoops to setup auto invest, I can't actually do it because the £100 a month across the three ETFs I want wouldn't be possible as it won't cover a full share.

What a drama! I'm so gutted Invest Engine don't offer a Junior S&S ISA because i've found them so good TBF.

Albermarle

Regular investing of small amounts in ETF's is a newish thing, and as IE are a newish player, offering only ETF's mainly to small investors, then they are set up for it.
The vast majority of HL's small regular investors will be invested in OEICs, where you can buy any amount over £25 you like with no issues. So I guess they are not going to bend over backwards, writing new software for what is a small market.
Having said that HL were market leaders as an online platform, but I believe their website/systems have not been significantly updated for about 10 years.
Their customer service is still very good if you need to contact them.