Witan giving up admin of Savings schemes

[tjh290633]

I received a notification today from Witan, saying that they are giving up administration of their savings schemes, including ISAs and Jump savings schemes for children. They are suggesting a move to Hargreaves Lansdown and include documents for such a change. The default is a move to HL.

TJH

[Nocton]

We have had Witan/Jump savings scheme for our four grandchildren for 15 years. Today we have received notification that the service is to be closed with the default option a transfer to Hargreaves Lansdown. The scheme service has been good and, having used HL in the past, we think it unlikely that we shall get a better service. Despite choosing one of the higher-than-average cost investment companies, the letter from the chairman describes HL as having a "competitive fee structure". That is simply not true and is the reason we left HL years ago for our own investments.

The changes really only benefit Witan and Witan Investment Services. While we can understand why the Boards would wish to do this, we do feel that the existing Jump schemes should have been continued while closing the scheme to new entrants. Saving for one's children and grandchildren is a long-term commitment and we would have expected WIS to honour the commitment they entered into. Clearly we live in a different world from the Board, but we could do without the mealy-mouthed phrase that the change is "in the interests of account holders", etc.

Is anyone else affected and do they have any thoughts?

[StOmer]

...Despite choosing one of the higher-than-average cost investment companies, the letter from the chairman describes HL as having a "competitive fee structure". That is simply not true and is the reason we left HL years ago for our own investments.

Aren't HL cheap when it comes to Investment Trusts which includes Witan, perhaps you are thinking of OEICS? Holding IT's in a HL Share a/c is free, ISA is £45 p.a. and SIPP £200 p.a. Dealing is a tad high at £11.95 but the monthly investment scheme for IT's is just £1.50 a trade. Seems a good deal to me.

[Nocton]

Aren't HL cheap when it comes to Investment Trusts

Yes, StOmer, for ITs only, they are competitive. Dealing costs and exit charges are higher than Jump, but there is no account charge, which Jump introduced some time ago. If one wants to keep paper statements then the cost will be more with HL. I'd really like to switch to our other grand-children's savings scheme with Baillie Gifford, but as I would have to sell Witan and switch to another of BG's ITs I assume that that would incur CGT?
I am sure that Witan/Jump could have negotiated a better deal if they hadn't just plumped for an easy option.

I am waiting to hear from Jump as to whether the bare trusts we hold the Witan shares in will still be valid.
All a lot of unwanted hassle and palaver.

[GJHarney]

Unhappy news, the number of low cost IT direct investment trusts are diminishing steadily. I always found the the biggest advantage of these was the regular monthly fire and forget savings with effectively free dividend reinvestment (as it was included in that month's fund deposit), and for smaller investors this is the biggest advantage over the platforms like HL where divi reinvestment will carry an additional dealing charge (which for smaller dividend lumps is not good value). Following the similar closure of F&C a few years ago is Baille Gifford the last IT investment house offering a direct investment service (whoch in BG's case is excellent for fund choice and costs) the last one standing?

As to moving my Witan (and Witan Pacific) share plan holdings I've already gone online and have completed the form for a transfer-in to my AJ Bell account as I don't want to go back to HL which I left for Youinvest some years ago.

[Nocton]

As to moving my Witan (and Witan Pacific) share plan holdings I've already gone online and have completed the form for a transfer-in to my AJ Bell account as I don't want to go back to HL which I left for Youinvest some years ago.

Yes, we have considered transferring to our on-line brokers, ii and Charles Stanley, but the situation is more complicated with holding 4 separate accounts in trust for our grandchildren. And Jump have still not advised whether we shall have to open/set up new bare trusts.
As I've said, our preferred option would be to move the whole lot to Baillie Gifford with whom we have another similar savings scheme for the grandchildren, but as we should have to swap Witan for e.g. Monks the Witan shares would need to be sold resulting in a substantial capital gain.

So in the end, we shall probably transfer to HL as the forms are all completed for the setting up of four new HL accounts. The only possible advantage I can see is that when the children turn 18, HL offer a wider range of options for further investment although I should not have recommended HL.

[Hariseldon58]

I am surprised that the regular saving schemes have continued as long as they have, I imagine the administrative effort is considerable. I benefitted hugely from them in the 90's and early 2000's for regular investments.

The advent of the online brokers was bound to end these sooner than later. Well done to Witan for carrying on as long as this.

[MDW1954]

Ten years ago, I was surprised that so many schemes remained. I use Baillie Gifford and Aberdeen.

MDW1954

[XFool]

Unhappy news, the number of low cost IT direct investment trusts are diminishing steadily.

Yes. Henderson (now Janus-Henderson) - Bankers, HFEL and others including at one time Witan - offloaded their scheme to Halifax Share Dealing Limited (and others) several years ago.

[tjh290633]

Unhappy news, the number of low cost IT direct investment trusts are diminishing steadily.

Yes. Henderson (now Janus-Henderson) - Bankers, HFEL and others including at one time Witan - offloaded their scheme to Halifax Share Dealing Limited (and others) several years ago.

Witan actually subcontracted their admin to F&C Asset management a few years ago.

TJH

[XFool]

Unhappy news, the number of low cost IT direct investment trusts are diminishing steadily.

Yes. Henderson (now Janus-Henderson) - Bankers, HFEL and others including at one time Witan - offloaded their scheme to Halifax Share Dealing Limited (and others) several years ago.

Witan actually subcontracted their admin to F&C Asset management a few years ago.

including at one time Witan

[tjh290633]

Yes. Henderson (now Janus-Henderson) - Bankers, HFEL and others including at one time Witan - offloaded their scheme to Halifax Share Dealing Limited (and others) several years ago.

Witan actually subcontracted their admin to F&C Asset management a few years ago.

including at one time Witan

Yes, I was clarifying who they offloaded their scheme to. Now they are giving up the schemes altogether and transferring clients to HL or a broker of their choice.

TJH

[XFool]

including at one time Witan

Yes, I was clarifying who they offloaded their scheme to. Now they are giving up the schemes altogether and transferring clients to HL or a broker of their choice.

OK.

It seems a shame these schemes have largely been abandoned, they were often a very low - even zero (exc. stamp duty) - cost way of buying shares. Very suitable for beginners. e.g Henderson used to be (I think) zero cost for purchases and £10 for selling.

I know brokers are now low cost for lump sums, but still seem higher cost for regular reinvestment of dividends from non large holdings.

[PeterBill]

It seems a shame these schemes have largely been abandoned, they were often a very low - even zero (exc. stamp duty) - cost way of buying shares. Very suitable for beginners. e.g Henderson used to be (I think) zero cost for purchases and £10 for selling.

I know brokers are now low cost for lump sums, but still seem higher cost for regular reinvestment of dividends from non large holdings.

Baillie Gifford follows suite and abandons trust saving schemes to Hargreaves ...

https://citywire.co.uk/investment-trust-insider/news/baillie-gifford-abandons-trust-saving-schemes-to-hargreaves/a1222729

More than 21,000 Baillie Gifford investors who hold £1.3 billion in the firm’s investment trusts, such as flagship Scottish Mortgage (SMT), will move to the Bristol-based broker

We have 5 grandkids ... their investments will soon be incurring charges which may be quite substantial compared to the monthly investment. Disappointed.

[XFool]

...Leaving Aberdeen Standard in the game, for now.