advice on regular payments into a SIPP please

sadexpunk

" I recently moved to Interactive Investor for that reason."
"Like Kynthia I also moved to II for the lower fees (........plus cashback incentive)."

so.... those 6 funds/shares i listed.  i can quite simply transfer over to II, no bother, and my investments stay the same but i pay less in fees?

MallyGirl

sadexpunk said:

" I recently moved to Interactive Investor for that reason."
"Like Kynthia I also moved to II for the lower fees (........plus cashback incentive)."

so.... those 6 funds/shares i listed.  i can quite simply transfer over to II, no bother, and my investments stay the same but i pay less in fees?

You need to do your own research. II charge fixed fees whereas I think that HL charge a percentage of the value. For larger value pots that makes II cheaper than HL. I don't know where the cutoff is.
They are also offering cashback at the moment https://www.ii.co.uk/ii-accounts/sipp which might be nice if it turns out to be the right choice for your circumstances 

sadexpunk

"You need to do your own research. II charge fixed fees whereas I think that HL charge a percentage of the value. For larger value pots that makes II cheaper than HL. I don't know where the cutoff is.

They are also offering cashback at the moment https://www.ii.co.uk/ii-accounts/sipp which might be nice if it turns out to be the right choice for your circumstances "

just been looking and it seems that II would charge a set fee of £12.99 pm (£164pa), compared to my last years total HL fees of double this amount (theres also the extra £250 cashback to invest too with II).
ive just contacted HL to ask if there are any transfer/exit fees.

if i do indeed transfer it, ill have to look at my OP in regards to II instead, and how to set up a DD to pay £100 pm into something.

thanks for the heads up.

bjorn_toby_wilde

Monevator has a good comparison tool where you can check who has the best rates dependant on what you’re invested in.

Remember that if you trade regularly there is normally a fee for every trade. For example if you set up a monthly direct debit then buy funds with that cash each month there will be a small fee each time you buy.

Re. Shares vs funds, very crudely when you buy a share it’s a share in a single company. When you buy a fund you’re joining with a lot of other people to buy shares in a lot of different companies.  If you google it you’ll find much better and clearer explanations   

Sarahspangles

In your other thread you initially mentioned you are currently paying into a DB (defined benefit) pension. Did you work out that it was actually a DC pension by the end?

The reason for asking is that there are two limits as to what you can pay up into a pension each year. This thread has talked about the limit of relevant UK earnings. The second limit is the Annual Allowance, which was mentioned in passing. It’s £60k currently. There is a different way of working out how much of this allowance a DB uses. But there’s no reason to go into that detail if you’re paying into a DC pension.

sadexpunk

"Remember that if you trade regularly there is normally a fee for every trade. For example if you set up a monthly direct debit then buy funds with that cash each month there will be a small fee each time you buy."

yep, as per my OP, that was one of my questions as to whether it would be more financially efficient to just tell HL/II to invest in one fund (say lifestrategy) each month for that £1.50 fee, or to spread it across all 6 funds (which may cost £9 pm).  i guess leaving it sat there for 6 months and then instructing them to invest to save a few months fees wouldnt make sense as id probably be able to make that in growth if invested earlier.

"Re. Shares vs funds, very crudely when you buy a share it’s a share in a single company. When you buy a fund you’re joining with a lot of other people to buy shares in a lot of different companies.  If you google it you’ll find much better and clearer explanations"

thank you for the simple explanation.  but as a financial ignoramus, i suppose i just dont need to know if its shares or funds, just that its growing more than a bank account, or rubbish DC pension say.

"Monevator has a good comparison tool where you can check who has the best rates dependant on what you’re invested in."

just had a look and again, it suggests that with a SIPP worth 130k like mine, II's flat fee wins over HL's %fee.
so im pretty sure i'll transfr over as soon as i get the nod from HL that theres no exit/transfer fee.

thank you

Sarahspangles

sadexpunk said:

"Remember that if you trade regularly there is normally a fee for every trade. For example if you set up a monthly direct debit then buy funds with that cash each month there will be a small fee each time you buy."

I use AJ Bell who have some own brand funds that are free to trade (buy and sell). They have catchy titles like ‘Adventurous’ to suggest the risk profile. There isn’t one called ‘Mild Peril’ - yet.

If I click into the fund info the aims are explained in plain-ish English. And the main holding in the fund is nearly always a Vanguard fund and there’s lots of information available about those. So I can spend a bit of time understanding the aims of the main fund and sub holdings.

I use a couple of these ‘free to trade’ for most monthly contributions, although I don’t think a small charge is really an issue unless it’s proportionally high in relation to the amount invested.

MallyGirl

Not especially recommending II - I just know about it as I use it. Regular investing is free with ii so you set up your DD and tell it what to buy with the money each month and it just does it automatically. I do this into an ISA.

sadexpunk

thanks.  had another look and see AJ bell to be another %fee broker so i think ill stick with my plans for II.

didnt want to wait the quoted 2 days for a reply from HL so ive just rang them about transfer fees.  theyve said there is no fee (great), but...... apparently i have one equity in there, probably vanguard ftse developed europe ex-uk equity (clues in the name i spose ) and they said that if the new broker doesnt support the transfer of equities and only cash transfers, then id either have to sell that myself of theyd do it (for a far greater fee).

so...... anyone know if thatd be an issue for II?

thanks

sadexpunk

im sure im missing some of these posts until later, apologies for late replies on some :-)

"In your other thread you initially mentioned you are currently paying into a DB (defined benefit) pension. Did you work out that it was actually a DC pension by the end?

The reason for asking is that there are two limits as to what you can pay up into a pension each year. This thread has talked about the limit of relevant UK earnings. The second limit is the Annual Allowance, which was mentioned in passing. It’s £60k currently. There is a different way of working out how much of this allowance a DB uses. But there’s no reason to go into that detail if you’re paying into a DC pension."

i dont currently pay into a DC scheme.  i have my previous employers DB scheme that we decided was better left alone, and my current firefighters pension which is also DB.  i pay around £500pm into that alongside employers contributions.  does this affect anything?

"Not especially recommending II - I just know about it as I use it. Regular investing is free with ii so you set up your DD and tell it what to buy with the money each month and it just does it automatically. I do this into an ISA."

ah, so yours isnt a pension, its an ISA.  is it the same principle, free investing?

must say im extremely impressed with the swift responses here, im getting typers cramp  

thanks