Timescale to move from SIPP to drawdown AC with Hargreaves Lansdown?

Albermarle

Pat38493 said:

KrullTheSaver said:

@Pat38493 They changed the look and feel of their app. I don't think they changed the back end yet (see below) - at least, not in any way noticeable to clients.

@Albermarle HL knew what was coming same as everyone (and from last year). They were warning that processing times were "longer than usual" and expected to be around 20 days. About as accurate as the OBR :-).

HL were bought out by a private equity consortium. The last couple of years they've probably been positioning for that. This year the new owners likely want to see some ROI and are reported to have said it requires "substantial investment" in "extensive technology-led transformation".

Mind you, for a lot of folks HL is a reasonably simple experience. Something like Interactive Investor is, well, more "investy" if you're not that familiar with the terroir. But the price for simplicity is high. From Feb 1 II will charge a flat 14.99 for SIPP(+drawdown)+ISA+GIA+JISA(one for each child). At HL's 0.45% fee level break even "only" needs a combined pot of, what? ~330k?

I'm embarrassed to say I should have moved long ago. Thanks for the push, HL!

Well that explains it!

Ref the HL charges, you can get it back close to the II charges if you only use certain types of investments like ETF.

I assume that ETFs must be easier to administer and manage for the providers as quite a few of them give you a reduced charge rate if you hold ETFs and shares vs funds.  I am not really sure why this is - as a clueless guess, I would have guessed that ETFs and shares are more difficult to manage as you have to facilitate that they can be traded in real time.

Fidelity and AJ Bell, also have similar caps. I have asked the question before 'why are they so low'
There seems to be no definitive answer, but it seems to be something along the lines of:
1) Straightforward competition
2) Probably only a small minority of more savvy investors take advantage of the caps.
3) This small minority probably have higher level of funds on the platforms
4) Some will be tempted to buy and sell more and rack up trading charges.

Probably they make a loss on these customers, but it helps keep up the market share/AUM. Same as with the cashback offers.
The losses are probably quite small in the overall picture.

I worked in a business where there was a constant uneasy  balance between profitability and market share. I suspect maybe something similar. 

ColdIron

Pat38493 said:

KrullTheSaver said:

@Pat38493 They changed the look and feel of their app. I don't think they changed the back end yet (see below) - at least, not in any way noticeable to clients.

@Albermarle HL knew what was coming same as everyone (and from last year). They were warning that processing times were "longer than usual" and expected to be around 20 days. About as accurate as the OBR :-).

HL were bought out by a private equity consortium. The last couple of years they've probably been positioning for that. This year the new owners likely want to see some ROI and are reported to have said it requires "substantial investment" in "extensive technology-led transformation".

Mind you, for a lot of folks HL is a reasonably simple experience. Something like Interactive Investor is, well, more "investy" if you're not that familiar with the terroir. But the price for simplicity is high. From Feb 1 II will charge a flat 14.99 for SIPP(+drawdown)+ISA+GIA+JISA(one for each child). At HL's 0.45% fee level break even "only" needs a combined pot of, what? ~330k?

I'm embarrassed to say I should have moved long ago. Thanks for the push, HL!

I assume that ETFs must be easier to administer and manage for the providers as quite a few of them give you a reduced charge rate if you hold ETFs and shares vs funds.  I am not really sure why this is - as a clueless guess, I would have guessed that ETFs and shares are more difficult to manage as you have to facilitate that they can be traded in real time.

I think some of it is historic with intertia. Before the RDR (Retail Distribution review) in 2013/14 ish platforms could do well with hidden commission and kickback with the initial charge and ongoing AMC. There's not much margin for this with anything traded on an exchange as there is no fund manager involved to do the kicking back so they pushed open ended funds as they seemed to be "free" before they introduced explicit fees

But I don't really know the full rationale. Long may it continue

UncleTomCobley

UncleTomCobley said:

Giddiness abounds in the Cobley household this morning as the long awaited HL SIPP => TFLS & drawdown completes. 

Just another two to go and that's it - and no more double account fees to boot.

A little update...

So it's a new year and another of my HL SIPP => TFLS & drawdowns has completed. The online request was submitted on 10 December.

Only one more to go - the excitement is palpable at the Cobleys.

nicknameless

Quicker to transfer out it seems.  Transfer to fidelity of my SIPP completed in less than ten working days (work £1k to me in transfer incentive).  Meanwhile Mrs me heard nothing about drawdown request from HL in same timescale (not expecting to of course).  Will be transferring her SIPP away in due course.  Wonder how much business this is costing them?

thingswerentthisbadinmyday

nicknameless said:

….. Wonder how much business this is costing them?

Not just the unacceptable length of time taken (in my case), to complete a drawdown request (which ended up with a goodwill gesture), but more recently, my patience has been wearing very thin when - not for the first time - I’ve requested answers to specific questions and received back a sort of general “catch all” reply.
After 10+ years, I am now seriously contemplating transferring to a competitor.

Goldiegirl

I don't think there has been much improvement in the last couple of months.

Last month my husband applied to put his SIPP into drawdown and take his 25% tax free lump sum.

It said that it would be actioned in 15 working days, and needless to say, nothing has happened.

Since he applied there has been turmoil on the markets due to the Iran war.

He sold off holdings for the lump sum before all this happened, using holdings from funds that were share based, and what is left is the less 'risky' holdings, so the total amount in the SIPP has held up quite well, although the lump sum, if done today would be less than when he applied.

I suppose we should start chasing HL, but part of me wants to hold back, in the hope that things improve. Otherwise, they'd probably end up doing the transfer on the day when the SIPP valuation is at it's lowest!

But, overall, I do feel rather disappointed with HL, as I thought their service would be better than this.

Maybe in due course, we'll look at transferring elsewhere.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81915974#Comment_81915974

I took a TFLS and into drawdown in two stages later last year with Fidelity, who are a similar type of operation.

They said it would take 8 working days, and the first one was exactly that and the second one was 7 working days. Not super quick but a reasonable benchmark I think.

Regarding the 'turmoil in the markets' it is probably having less effect on his funds than you might think.

Although a typical medium risk 60/40 fund has lost 3 to 4 % since the war started, it is only down about 1% in the past month.

dunstonh

Also, doing it in late Feb into March is a peak period. A lot of people wait until the 6th March to do their drawdowns to get in the final payroll period of the tax year. Plus, you have the deadline earlier this month as easter is early and falls at tax year end. So, the cut offs are earlier.

So, many firms that require human input at some of the stage are hitting capacity issues.

DT2001

https://forums.moneysavingexpert.com/discussion/comment/81917038#Comment_81917038

I’m with Fidelity and took my 25% last year and it took a week. One off payment requested online on 3rd March utilising cash and into account on the 5th. Paperwork suggested not due until the 9th.

Moved ISAs from HL to Fidelity last month after fee increase. Cash back, lower fees and transfer in specie inside a week. It seems as if HL’s reputation for good customer service is waning - I never had a problem with their speed of dealing with matters but not competing with other large platforms is surprising.

Pat38493

https://forums.moneysavingexpert.com/discussion/comment/81917055#Comment_81917055

I can vouch for this - I made a small drawdown withdrawal from II in each of the last few months. The first 2 took them only a day or two to action. The one that I launched on 6th March has taken longer but I see that it’s just been debited from my account this afternoon, so it’s delayed but not by a huge amount.