We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Vanguard: New Minimum Monthly Account charge

Options
1252628303134

Comments

  • boingy
    boingy Posts: 1,910 Forumite
    1,000 Posts Second Anniversary Name Dropper
    eskbanker said:
    boingy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    I think that's mostly not true. A few vocal folks will have left, a few others will have said that they are leaving but not done so The vast majority of folks are unaffected by the change because they are already paying more than that minimum fee. Vanguard will have set that threshold very carefully. And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    Have VG provided (or do you have) figures to back up that assertion?
    Vanguard have the figures. That's how they decided on that threshold. They know that the change will drive away some customers but those customers will very much be in the minority because Vanguard are not daft. It's business. They need to make money.
    Of course Vanguard have the figures but the question was do you have evidence of them to support the assertion that the vast majority are unaffected, which would signify that the vast majority of their customers have over £32K invested?

    I do agree that Vanguard will have done the modelling and will know exactly what percentage of their customer base will pay more under the new fees, and in turn they'll have estimated the size of the subset of those who'll actually be motivated enough to take their business elsewhere, but the thread is full of vague terms about 'some', 'a lot', 'many', 'the majority', etc, and so it's not unreasonable to ask if posters can actually quantify any of these by reference to verifiable statistics, especially one asserting that "The vast majority of folks are unaffected by the change"....
    <sigh> ..........
  • Hoenir
    Hoenir Posts: 7,742 Forumite
    1,000 Posts First Anniversary Name Dropper
    Slinky said:
    Hoenir said:
    I'm guessing a lot of us have left Vanguard now. For those that have changed platform, have you stuck with Vanguard funds or made changes? As Vanguard have annoyed me with this move, I feel I might stop giving them preferential treatment when it comes to fund / ETF choice.
    Try not to allow emotion to affect your investing decisions.
    Vanguard made a simple business decision about their UK investment platform. In that it was costing too much to service their smaller customers.
    As said in another post, T212, Invest Engine ( currently losing £5Million Pounds a year) will most likely eventually do something similar.
    It is just business.
    The full impact of last year's budget is going to ripple far and wide. Ultimately be the consumer that foots the bill. 

    I think you underestimate the level of apathy and the CBA factor that a lot of people demonstrate. There's millions, billions probably languishing in exceedingly low paying bank accounts. I for one CBA to move my Vanguard account elsewhere for the sake of the extra couple of pounds it might cost me per month.
    I'm referring to the cost of service provision. Customer service agents as one example are non productive. £48 probably doesn't even cover the full cost of two hours of somebody's working time. Business models are going to be revised. Those offering no cost  / low cost options will be weighing up whether it's actually economically viable. 
  • MeteredOut
    MeteredOut Posts: 3,050 Forumite
    1,000 Posts Second Anniversary Name Dropper
    boingy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    I think that's mostly not true. A few vocal folks will have left, a few others will have said that they are leaving but not done so The vast majority of folks are unaffected by the change because they are already paying more than that minimum fee. Vanguard will have set that threshold very carefully. And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    Have VG provided (or do you have) figures to back up that assertion?
    Vanguard have the figures. That's how they decided on that threshold. They know that the change will drive away some customers but those customers will very much be in the minority because Vanguard are not daft. It's business. They need to make money.
    Lots of words to say no, but thanks :)
  • jbrassy
    jbrassy Posts: 1,022 Forumite
    Seventh Anniversary 1,000 Posts Name Dropper
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    So I'm one of those folks moving my SIPP to Invest Engine following this fee change. The SIPP is worth circa £10k so I'll end up paying a lot more in fees if I stay with Vanguard. 

    The day that Invest Engine increase their fees, I will again consider the options available to me in the market and see what constitutes the best value and switch if necessary. This is what I do with every financial product I have, try and find the one which best suits my needs. Do you think I should stay put with Vanguard and pay the higher fees because Invest Engine might increase their fees in the future? That would be a pretty dumb thing to do.
  • Albermarle
    Albermarle Posts: 27,820 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    jbrassy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    So I'm one of those folks moving my SIPP to Invest Engine following this fee change. The SIPP is worth circa £10k so I'll end up paying a lot more in fees if I stay with Vanguard. 

    The day that Invest Engine increase their fees, I will again consider the options available to me in the market and see what constitutes the best value and switch if necessary. This is what I do with every financial product I have, try and find the one which best suits my needs. Do you think I should stay put with Vanguard and pay the higher fees because Invest Engine might increase their fees in the future? That would be a pretty dumb thing to do.
    As with any financial decision there is an upside and a downside to moving funds around to get the best deal ( or even free deal).
    In this case the upside is you save money , but for me the downside is that you are moving from a massive global asset manager, to a UK fintech company losing £5 million Pounds a year on a turnover of £350 K.
    Most likely there will be no problems, but it is something that should at least be kept in mind.

  • MeteredOut
    MeteredOut Posts: 3,050 Forumite
    1,000 Posts Second Anniversary Name Dropper
    jbrassy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    So I'm one of those folks moving my SIPP to Invest Engine following this fee change. The SIPP is worth circa £10k so I'll end up paying a lot more in fees if I stay with Vanguard. 

    The day that Invest Engine increase their fees, I will again consider the options available to me in the market and see what constitutes the best value and switch if necessary. This is what I do with every financial product I have, try and find the one which best suits my needs. Do you think I should stay put with Vanguard and pay the higher fees because Invest Engine might increase their fees in the future? That would be a pretty dumb thing to do.
    As with any financial decision there is an upside and a downside to moving funds around to get the best deal ( or even free deal).
    In this case the upside is you save money , but for me the downside is that you are moving from a massive global asset manager, to a UK fintech company losing £5 million Pounds a year on a turnover of £350 K.
    Most likely there will be no problems, but it is something that should at least be kept in mind.

    What's the worst that could happen if InvestEngine go bust?
  • Albermarle
    Albermarle Posts: 27,820 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    jbrassy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    So I'm one of those folks moving my SIPP to Invest Engine following this fee change. The SIPP is worth circa £10k so I'll end up paying a lot more in fees if I stay with Vanguard. 

    The day that Invest Engine increase their fees, I will again consider the options available to me in the market and see what constitutes the best value and switch if necessary. This is what I do with every financial product I have, try and find the one which best suits my needs. Do you think I should stay put with Vanguard and pay the higher fees because Invest Engine might increase their fees in the future? That would be a pretty dumb thing to do.
    As with any financial decision there is an upside and a downside to moving funds around to get the best deal ( or even free deal).
    In this case the upside is you save money , but for me the downside is that you are moving from a massive global asset manager, to a UK fintech company losing £5 million Pounds a year on a turnover of £350 K.
    Most likely there will be no problems, but it is something that should at least be kept in mind.

    What's the worst that could happen if InvestEngine go bust?
    Your money will probably be inaccessible for a while, whilst administrators wind up the business/sell it.
    If there was some kind of maladministration and your £10K did not exist or had been 'redirected' , then you would have to wait for FSCS to pay out.
    For the record ( again) there is no indication of any problems with IE.
  • MeteredOut
    MeteredOut Posts: 3,050 Forumite
    1,000 Posts Second Anniversary Name Dropper
    edited 31 January at 5:46PM
    jbrassy said:
    boingy said:
    I'm guessing a lot of us have left Vanguard now. 
    And for those folks moving to the "new" providers like T212 or InvestEngine, what do you think they are going to do once they have plenty of customers? Yep, They'll start charging more because they need to stay in business.
    So I'm one of those folks moving my SIPP to Invest Engine following this fee change. The SIPP is worth circa £10k so I'll end up paying a lot more in fees if I stay with Vanguard. 

    The day that Invest Engine increase their fees, I will again consider the options available to me in the market and see what constitutes the best value and switch if necessary. This is what I do with every financial product I have, try and find the one which best suits my needs. Do you think I should stay put with Vanguard and pay the higher fees because Invest Engine might increase their fees in the future? That would be a pretty dumb thing to do.
    As with any financial decision there is an upside and a downside to moving funds around to get the best deal ( or even free deal).
    In this case the upside is you save money , but for me the downside is that you are moving from a massive global asset manager, to a UK fintech company losing £5 million Pounds a year on a turnover of £350 K.
    Most likely there will be no problems, but it is something that should at least be kept in mind.

    What's the worst that could happen if InvestEngine go bust?
    Your money will probably be inaccessible for a while, whilst administrators wind up the business/sell it.
    If there was some kind of maladministration and your £10K did not exist or had been 'redirected' , then you would have to wait for FSCS to pay out.
    For the record ( again) there is no indication of any problems with IE.
    Kind of off-topic, but if that did happen, when the FSCS pays out, is that investment value at the date of liquidation event, or investment value at the date of payout?

    And are there allowaces in place to ensure the funds can stay within the same wrapper (ISA or SIPP) with any new provider the funds are transferred to? Although getting the monies back would be good, it'd be a kicker to lose the tax shielding benefits.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 350.9K Banking & Borrowing
  • 253.1K Reduce Debt & Boost Income
  • 453.5K Spending & Discounts
  • 243.9K Work, Benefits & Business
  • 598.8K Mortgages, Homes & Bills
  • 176.9K Life & Family
  • 257.2K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.