Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • MSE Amy
    • By MSE Amy 15th Apr 14, 6:25 PM
    • 28Posts
    • 36Thanks
    MSE Amy
    Stocks & Shares ISAs
    • #1
    • 15th Apr 14, 6:25 PM
    Stocks & Shares ISAs 15th Apr 14 at 6:25 PM
    Hi!

    This is the discussion thread for the


    Click reply below to discuss. If you havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.
Page 2
    • jimjames
    • By jimjames 16th Apr 14, 9:10 PM
    • 13,286 Posts
    • 12,344 Thanks
    jimjames
    If I'm reading it right their charges will now cost me £45 per £10K and I could get it for £25, so that will save me £25 per ten thousand pounds each year. Hmmm don't think I will be rushing to move. I know rates and costs are important in all things but does customer service count for nothing anymore. I will be staying put as IMO their customer service is first class, their website and apps easy to use, informative and convenient. r
    Originally posted by trevjl
    It's hard for a simple site like MSE to be able to cover all the options and variations but they certainly don't make things easy for new investors with some of the misleading info provided.

    HL are one of the more expensive providers but as you have spotted it really depends on the amount you have invested. At £10k the difference is small and like you say the good service and friendly website is worth paying for.

    However once you get to having a portfolio of £100k or £200k and the difference is £450 vs £250 or £900 vs £500 then saving £200 or £400 per year starts to become far more significant and maybe not worth paying for.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • Archi Bald
    • By Archi Bald 16th Apr 14, 9:22 PM
    • 9,376 Posts
    • 7,432 Thanks
    Archi Bald
    The entire MSE article just serves the purpose of generating affiliate income for MSE. It is anything but impartial, and does not equip investment newbies with the basic yet comprehensive information needed to make informed decisions. Sad but true.
    • Archi Bald
    • By Archi Bald 16th Apr 14, 9:27 PM
    • 9,376 Posts
    • 7,432 Thanks
    Archi Bald
    It's hard for a simple site like MSE to be able to cover all the options and variations but they certainly don't make things easy for new investors with some of the misleading info provided.

    HL are one of the more expensive providers but as you have spotted it really depends on the amount you have invested. At £10k the difference is small and like you say the good service and friendly website is worth paying for.

    However once you get to having a portfolio of £100k or £200k and the difference is £450 vs £250 or £900 vs £500 then saving £200 or £400 per year starts to become far more significant and maybe not worth paying for.
    Originally posted by jimjames
    A lot also depends on what you have invested in, and whether you chose an ISA or a SIPP. For small SIPPs (up to around £50K), HL are amazingly competitive. They are also quite competitive if you have a huge portfolio (£1m upwards - - - which almost nobody has presently).

    HL also have many other potential charges that need to be taken into account. Let's not forget, they are a plc that has to generate income and added value for their shareholders. Similar to MSE having to generate affiliate income.

    Dog eats dog.
    • BobQ
    • By BobQ 16th Apr 14, 9:45 PM
    • 10,730 Posts
    • 14,135 Thanks
    BobQ
    You are joking, are you. Your, and the MSE, approach is a bit like choosing a car dealer before you have even established whether you want a car or a push bike.

    Giving inexperienced people the wrong advice is a terrible thing to do.
    Originally posted by innovate
    I do not have an approach.

    MSE is stating a fact: To buy an ISA yiu need to have a platform first and buy funds using it.

    You are saying this is wrong because it is unwise to choose the platform first when the costs of the funds you buy may be cheaper on another platform. Also true, but MSE makes that point three paragraphs later.

    I am in no position to accuse anyone of being pedantic, but I think you could cut them a little slack!
    Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are incapable of forming such opinions.
    • mikebeaches
    • By mikebeaches 16th Apr 14, 9:55 PM
    • 37 Posts
    • 40 Thanks
    mikebeaches
    I'm a pretty new investor since last December and have mine with H & L. I went with them because of the old S & S ISA guide which gave them a decent review. I looked a few days ago and the guide was still the same and if memory serves me had not been updated since 2009 (stand to be corrected on that) but it was certainly a long time ago. I look tonight after getting the weekly email and low and behold it has been updated and H & L are now awful !! If I'm reading it right their charges will now cost me £45 per £10K and I could get it for £25, so that will save me £25 per ten thousand pounds each year. Hmmm don't think I will be rushing to move. I know rates and costs are important in all things but does customer service count for nothing anymore. I will be staying put as IMO their customer service is first class, their website and apps easy to use, informative and convenient. Probably the same reasons I have banked with first direct since it's inception.
    Is it me or has this website become progressively worse since it sold out ?
    Rant over
    Originally posted by trevjl
    Not sure if you've seen the rather long thread - currently running to 47 pages - about folk trying to leave Hargreaves Lansdown?

    http://forums.moneysavingexpert.com/showthread.php?t=4870018
    • masonic
    • By masonic 16th Apr 14, 10:14 PM
    • 12,619 Posts
    • 10,125 Thanks
    masonic
    I stopped paying any attention to the information on the main site a long time ago. The quality of information that can be gleaned through reading the forums is much better and it appears this article is no exception.
  • innovate
    I do not have an approach.

    MSE is stating a fact: To buy an ISA yiu need to have a platform first and buy funds using it.

    You are saying this is wrong because it is unwise to choose the platform first when the costs of the funds you buy may be cheaper on another platform. Also true, but MSE makes that point three paragraphs later.

    I am in no position to accuse anyone of being pedantic, but I think you could cut them a little slack!
    Originally posted by BobQ
    MSE, and you, are saying that you first chose a platform and then choose your investment. This indicates that neither MSE nor you actually do understand anything about investments since it is totally obvious to anyone thinking this through is that you start with defining your investment portfolio, not with opting for your investment vehicle.

    Nothing pedantic about it, just plain logic and common sense.

    If you would care to read up on investments (e.g. Tim Hale "Smarter Investing", anything on Motley Fool or monevator, anything in the personal finance sections of respectable papers, and even the personal finance sections of tabloid papers), you would see that nobody who wants to make money from their investments is starting by choosing a platform.
    • drewsterboy
    • By drewsterboy 16th Apr 14, 10:53 PM
    • 8 Posts
    • 3 Thanks
    drewsterboy
    Best provider for regular (monthly) investments?
    I can't work out which is the best platform for making regular (monthly) investments. Let's say I want to put anywhere between £250 and £1,250 a month into a stocks & shares ISA. It looks like I'm better off with Cavendish's 0.25% fee (maximum £37.50 for the first year) rather than iWeb's fee of £5 per trade (£60 a year + £25 charge); but in subsequent years I might have to switch.

    Ease of use is important too. Are there any providers where I can set up a standing order, and have it automatically invested in a specific fund or share? iWeb used to offer this for just £1.50 a month, but they stopped, citing "low demand".
    • masonic
    • By masonic 16th Apr 14, 10:59 PM
    • 12,619 Posts
    • 10,125 Thanks
    masonic
    Ease of use is important too. Are there any providers where I can set up a standing order, and have it automatically invested in a specific fund or share? iWeb used to offer this for just £1.50 a month, but they stopped, citing "low demand".
    Originally posted by drewsterboy
    Interactive Investor still do £1.50 monthly trades. Platform fee is £80, but you do get that back in free trading credit.
    • MSE Martin
    • By MSE Martin 17th Apr 14, 12:20 AM
    • 8,116 Posts
    • 42,310 Thanks
    MSE Martin
    Thank you for the feedback above folks.

    We've done our best to meet the constant demand from users for an article on this subject.

    As you'll note this is what we call a 'first incarnation' article - and we always welcome your thoughts as on an expansive piece like this people don't necessarily read it the way we intend it to be read. So we have to tweak it to try and reflect that.

    I'm actually off work this week, but was involved in the planning and angles we chose to take before I went, though not the final draft.

    We're constantly tweaking this and improving it, and your feedback where appropriate will be incorporated. I have a meeting next week, as I normally do with new guides, when back to review the guide again looking at feedback as well as data analysis of the article use itself (plus as I didnt edit this personally, my take on it) as we aim to hone and improve it.

    It's not easy writing a guide like this, and I think the team have done a great job. The difficulty is it must be aimed both first time investors who haven't a clue where to start, and more experienced investors who just want to know the cheapest place to do it. More difficult is the fact that our focus is on platforms not funds as we don't aim to become an investment choice site.

    One thing I would note is that a few of the criticisms above seem to have missed where we say exactly what you're saying "we should say". Eg we already have a full Junior ISA guide. We have a SIPP guide. Yet we segment articles on the subject - this is only a 'stocks and shares ISA' guide for adults.

    The point about cash ISAs v shares was for those who wanted to do both talking which is more favourable for tax in different circumtances, that obviously didn't come across, so I've asked the team to look at tweaking the text to make it more clear.

    The team have done very detailed research and number crunching into different scenarios to pick these providers. As always we first do the research, pick the top providers, then go seee if the top providers had affiliate links, in this case most did - if they hadn't we would've still linked and written in the same way (its worth noting in this sector, virtually all proividers have affiliate programmes, so the vast majority of those we didn't pick have them too).

    Anyway back to the main point, hopefully over the next few weeks (then months, then years) you'll see the article iteratively improve and help more people - and your feedback will have been a valuable part of that so thank you.

    Martin

    PS Sorry if this is scrappily written, I've bashed it out quickly while Mrs MSE isn't looking - as Im meant to be going work Cold Turkey!
    Martin Lewis, Money Saving Expert.
    Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.

    Don't miss out on urgent MoneySaving, get my weekly e-mail at www.moneysavingexpert.com/tips.

    Debt-Free Wannabee Official Nerd Club: (Honorary) Members number 000
    • huudi
    • By huudi 17th Apr 14, 7:55 AM
    • 12 Posts
    • 1 Thanks
    huudi
    Take a look at Charles Stanley Direct. Similar charges to Cavendish but may have more scope. Excellent website too.
    Originally posted by Robin Davies
    Wrong here, CS have punishing charges if you do not deal regularly i.e. 6 time in 6 months. You cannot buy & forget, but have to choose between unwanted trades or high charges and if you inadvertently only make 5 trades then you pay BOTH!
    • Brand
    • By Brand 17th Apr 14, 8:08 AM
    • 79 Posts
    • 21 Thanks
    Brand
    . . . this guide is a good starting point for someone willing to dip their toes for the first time. . . . there's too much to take in.
    Originally posted by oioisexy
    I agree with this, that it is a good guide (there is another pretty good overview on thisismoney but it is the nittygritty, which the guides can't possibly cover, that is hard to find out. Remember too that these schemes were worked out quickly, and inspired by a marketing person, so headline counts more than detail. I had queries on fees, penalties and incentiveswith TDW, interactive, youinvest, and iWeb and found it easiest just to ring them up.
    Use the guides to get an idea of a couple of providers , then think what do I want to invest in and in what timescales, then think is an isa useful for this, or is it not worth the hassle and constraints and costs, especially if you are a basic rate taxpayer (it usually isn't - see Teresalia comment on this is money)and then look into the detail.

    More specific providers to look at to start with: if you want to invest in a spread of funds with a smallish total £, then start with a %pa provider such as cavendish online ( for LSE listed shares (including London-listed ETFs and I.Ts covering abroad, and expecting several trades per year, look at commission rates, so start with x-o and iWeb. For the occasional New York listed stock or ETF, you can get that with iWeb. For the above shares (not funds) with infrequent trading, try interactiveinvestor, for a mix of LSE and NY listed shares, but mixed with some funds too, and try also interactiveinvestor. The frequent trader options are mentioned in the guide. For the thought-free, start with fundsmith, which is a single simple fund with an isa wrapper possible.
    Also if you want a spread of providers, later, you need to keep your providers separate now, as you won't usually be able to split up a provider later.
    The key thing we don't know is the interest rate on cash in a stocks and shares isa that inevitably the providers will need to offer after July,and if they will alter account transfer out charges later.
    Last edited by Brand; 17-04-2014 at 8:56 AM. Reason: add bottom para on starting points to look at
  • innovate
    Use the guides to get an idea of a couple of providers , then think what do I want to invest in and in what timescales, then think is an isa useful for this,
    Originally posted by Brand
    Sounds like a typical "shoot - ready - fire - aim" approach to me

    or is it not worth the hassle and constraints and costs, especially if you are a basic rate taxpayer (it usually isn't - see Teresalia comment on this is money)and then look into the detail.
    Originally posted by Brand
    I would wholly disagree that an S&S ISA isn't "usually" worth it if you have decided to invest. As has been discussed, just alone the avoidance of the need for detailed record keeping over several years for tax purposes is a massive benefit.

    Apart from that, the tax shelter costs nothing extra (if you choose the right provider) but can be a massive advantage a few years or decades down the line, when some people might find themselves in higher rate tax brackets. And particularly now that it is possible to transfer from S&S to cash.
  • innovate
    Also if you want a spread of providers, later, you need to keep your providers separate now, as you won't usually be able to split up a provider later.
    Originally posted by Brand
    This would really only be a potential issue because the costs might be prohibitive, and/or in specie transfers might not be possible if you chose some exotic investment. A huge range of mainstream investments is available on all good platforms. If a provider doesn't offer the mainstream investments, that should perhaps be a very good reason to avoid them in the first instance.
    • p00hsticks
    • By p00hsticks 17th Apr 14, 9:05 AM
    • 7,265 Posts
    • 8,106 Thanks
    p00hsticks
    Despite being a basic rate taxpayer and very unlikely to exceed the CGT limit for a very long time (if ever), I have chosen to invest using a tax wrapper for the simple reason that it saves a lot of bother with record keeping and filling out a tax return.
    Originally posted by LookingToTheFuture


    I think a lot of people underestimate their chances of exceeding the CTG limit. With the maximum yearly investment in a ISA at around £15,000 from July, and the CTG limit still at around £10k, it only requires a 66% rise in value for CTG to become a consideration. In a period when the market is rising (say over the last 3-5 years ) that's far from unlikely even for mainstream FTSE 100 companies - some have tripled or quadrupled in value over the last few years.

    http://www.hl.co.uk/shares/stock-market-summary/ftse-100/performance
    Last edited by p00hsticks; 17-04-2014 at 9:26 AM. Reason: added link to FTSE 100 performance
  • Nummularia
    Dividends and tax credits
    My concern with the article is the statement that only higher rate tax payers gain from the benefits of receiving dividends in an ISA. This might be true for many but not if one also receives tax credits. Admittedly, those saving in stocks and shares and receiving tax credits may be relatively small, but if one is on a low to medium income with a family but have a high level of savings (from inheritance in my case), then receiving dividends in an ISA makes a huge difference as one does not have to declare income from an ISA for the purpose of tax credits. Considering the taper on tax credits is 41%, this means that as a basic rate tax payer I effectively lose 51% of any dividend outside an ISA but only 10% in an ISA. I have therefore made an effort to move as much of my income generating investments into an ISA.
    • Brand
    • By Brand 17th Apr 14, 10:51 AM
    • 79 Posts
    • 21 Thanks
    Brand
    . . .
    I would wholly disagree that an S&S ISA isn't "usually" worth it if you have decided to invest. As has been discussed, just alone the avoidance of the need for detailed record keeping over several years for tax purposes is a massive benefit. . . .And particularly now that it is possible to transfer from S&S to cash.
    Originally posted by innovate
    Yes for you the convenience outweighs the cost and constraints, but I suspect you are unusual for a basic rate payer. An IFA should normally say not to bother unless trying to avoid CGT for a lump sum (e.g. for house purchase and need to sell investments all at once instead of sell yearly in chunks
    interested in tax credit teatment of isa divis, as I thought assessment took into account all income. If true then yes, could be a big consideration for basic rate taxpayer.
    Last edited by Brand; 17-04-2014 at 11:29 AM.
    • Brand
    • By Brand 17th Apr 14, 11:07 AM
    • 79 Posts
    • 21 Thanks
    Brand
    . . . And particularly now that it is possible to transfer from S&S to cash.
    Originally posted by innovate
    Yes, though t's not "now", it's July, so why not wait til then, so no costs incurred until then, and the providers revamp their offering perhaps?
    • Brand
    • By Brand 17th Apr 14, 11:17 AM
    • 79 Posts
    • 21 Thanks
    Brand
    . . .A huge range of mainstream investments is available on all good platforms.
    Originally posted by innovate
    if you eventually want a provider who is good/cheapest for shares and and a provider good/cheapest for a small amount of money in funds and a provider for a large amount of money in funds and a provider who is good/cheapest for frequent share trading, this might not be the same provider, so you need to keep your isa pots separate, as you usually can't unravel a single isa. There might also be a good isa offering in the future, and you think I'd like to try that with a little of my isa money but not all.
  • hwindsor
    It is possible to invest in certain funds without going via a platform
    A few people have stated as absolute that the only way to invest in funds is via a platform. That it is not possible to invest via the fund manager directly.
    This is not true.
    For many years I've invested into index trackers with Legal and general directly. I have only gone with platforms for active managed funds as the platform reduced the initial and annual management fees and hence it was cheaper to invest via the platform.
    From my reading of the fees, it is better for people to invest in two of the funds listed (The L&G UK Index and the L&G US Index) directly with L&G themselves. It certainly was in comparison with investing via H&L as H&L gave no reduction in the AMCs (there are no initial fees) and added their own platform fee on top.
    So am I right in that in this case (L&G) the charges are lower going directly? In which case why would anyone use a platform for these funds?
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

20Posts Today

4,041Users online

Martin's Twitter