Remove ads

Introducing the LemonFools Personal Finance Calculators

Managing (or avoiding) multiple S&S ISA accounts

Investment discussion for beginners. Why you should invest your money, get help getting started
iambic
Posts: 5
Joined: October 11th, 2018, 1:22 pm
Has thanked: 1 time

Managing (or avoiding) multiple S&S ISA accounts

#172996

Postby iambic » October 11th, 2018, 1:26 pm

Apologies for the total newbie question, but trawling through this forum has given me so much useful insight already that I thought I'd pose the question I've been trying to figure out an answer to, in the hope that you can provide me with some guidance.

My husband & I started on our journey towards financial independence at the start of 2018 & after tons of reading, we settled on a portfolio that looks reasonably diversified & that we're happy with. Now to put it into action!

My husband opened an ISA with Vanguard & we've started putting some money into various index trackers within that account. Now I'd like to start getting some cash into some different parts of the portfolio (bonds, a property REIT, an emerging markets tracker etc.) I have an ISA with Fidelity (via Cavendish Online) already, with some money in Fundsmith Equity (have had it from before I realised how expensive active funds were...), so I was planning to buy the additional portfolio elements within my Fidelity ISA for some platform diversification & because some of the funds we want are not available on Vanguard (or cost more on Vanguard).

I know it's very early in our investing journey & I'm trying not to get carried away, but reading about HYP's & Investment Trusts has made me think about some of the other areas (apart from equity index trackers) that I'd like to learn more about & hopefully incorporate into our portfolio one day.

My question (got to it at last) is about how best to manage all this, whilst keeping our money within ISA wrappers? Given that we can each only pay into one S&S ISA per year, it would be great if there was one platform that had all the funds/shares/IT's etc. that we wanted to buy. Although this would bad for platform diversification, it would make topping up, rebalancing & adding different elements to the accounts straightforward. This doesn't appear to be possible though. Fidelity do now offer shares on their site, however at £10 per deal this doesn't seem like a sensible place to start building a HYP alongside our funds.

Is there a better platform that would offer a wide range of funds, shares & IT's, which might be suitable? I'm loathe to go down the route of having multiple S&S ISAs, of which I'd only be able to amend one per year. I've tried comparing platform costs but to be honest it's such a minefield of information I end up more confused. TIA for your help :)

Alaric
Lemon Quarter
Posts: 2188
Joined: November 5th, 2016, 9:05 am
Has thanked: 4 times
Been thanked: 425 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173005

Postby Alaric » October 11th, 2018, 1:52 pm

iambic wrote:Is there a better platform that would offer a wide range of funds, shares & IT's, which might be suitable?


Fidelity's platform by its background is orientated towards OEICs. Platforms that offer stock market investments mostly offer OIECs as well, but you may find some OIECs funds unavailable.

£ 10 or some similar amount per deal is the usual price. It is possible to go cheaper by using bulk dealing days. It can be necessary to think in terms of a minimum purchase size of £ 1000 or thereabouts for shares etc, to keep the dealing costs down when expressed as a percentage of the investment.

You get a trade off. All sites will charge for dealing in shares, but charging a regular fee as a percent of share investment value is uncommon. Some sites will charge nothing for buying OIECs but impose a platform fee as % of value. Others apply the same costs as for buying shares.

JohnB
2 Lemon pips
Posts: 235
Joined: January 15th, 2017, 9:20 am
Has thanked: 5 times
Been thanked: 50 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173011

Postby JohnB » October 11th, 2018, 2:03 pm

I'd not get obsessed about trickling money into all parts of a diversified portfolio each year. With 6 things, you and your husband could each buy one tranche a year on a 3 year cycle, so only 2*£10 dealing costs. Don't mirror your portfolios, each have a different provider both for diversity of offering, but also reducing risk of provider failure. This ties your finances together, so make sure your marriage is healthy! You also need a rebalancing strategy, again, I'd do it rarely. Decide whether to have providers that charge fixed or %age custody fees, the economics will change as your portfolio grows.

iambic
Posts: 5
Joined: October 11th, 2018, 1:22 pm
Has thanked: 1 time

Re: Managing (or avoiding) multiple S&S ISA accounts

#173020

Postby iambic » October 11th, 2018, 2:23 pm

JohnB wrote:I'd not get obsessed about trickling money into all parts of a diversified portfolio each year. With 6 things, you and your husband could each buy one tranche a year on a 3 year cycle, so only 2*£10 dealing costs. Don't mirror your portfolios, each have a different provider both for diversity of offering, but also reducing risk of provider failure. This ties your finances together, so make sure your marriage is healthy! You also need a rebalancing strategy, again, I'd do it rarely. Decide whether to have providers that charge fixed or %age custody fees, the economics will change as your portfolio grows.


Thanks John, I think my original post was a little unclear - Fidelity charge £10 per deal (no charge for funds although there is a 0.25% platform fee for using Cavendish Online), so if I want to buy shares in say, 10 different companies this month, that would be 10 x £10 in fees, then if I want to buy more shares in the same 10 companies in 6 months' time, that would be another 10 x £10 fees. Unless I've misunderstood their fees completely!

To be honest, at the moment I'm mainly trying to work out how to build a good fund-based portfolio, given that I'd like to keep everything wrapped in an ISA, but can't find a platform which offers access to all the funds we would want to hold. It would be great to have access to shares down the line through the same platform, but ideally not one which comes with extortionate fees! :)

Alaric
Lemon Quarter
Posts: 2188
Joined: November 5th, 2016, 9:05 am
Has thanked: 4 times
Been thanked: 425 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173031

Postby Alaric » October 11th, 2018, 2:55 pm

iambic wrote: It would be great to have access to shares down the line through the same platform, but ideally not one which comes with extortionate fees! :)


£ 10 a deal is a normal price. Unless you are investing say £ 20,000 to £ 50,000, I don't think you should be thinking in terms of 10 companies at once.

iambic
Posts: 5
Joined: October 11th, 2018, 1:22 pm
Has thanked: 1 time

Re: Managing (or avoiding) multiple S&S ISA accounts

#173035

Postby iambic » October 11th, 2018, 3:03 pm

Alaric wrote:
iambic wrote: It would be great to have access to shares down the line through the same platform, but ideally not one which comes with extortionate fees! :)


£ 10 a deal is a normal price. Unless you are investing say £ 20,000 to £ 50,000, I don't think you should be thinking in terms of 10 companies at once.


Maybe I'm missing something, but it looks like some other platforms charge less than £10 (iWeb appears to charge £5 per deal for instance)?

The 10 x companies was just an example to illustrate how the fee charges would add up. As I mentioned in my original post, I'm not looking to buy shares at the moment (I clearly still have loads to learn!) but I am trying to plan ahead so would like to choose where to open my S&S ISA on the best all-round platform for funds, shares, ITs etc.

Alaric
Lemon Quarter
Posts: 2188
Joined: November 5th, 2016, 9:05 am
Has thanked: 4 times
Been thanked: 425 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173054

Postby Alaric » October 11th, 2018, 3:45 pm

iambic wrote:Maybe I'm missing something, but it looks like some other platforms charge less than £10 (iWeb appears to charge £5 per deal for instance)?


If you think in terms of investing always at least a four figure sum, a charge in the range £ 5 to £ 20 is just small change. What you don't want is the platform helping itself to a percentage of the total worth once there's a reasonable amount there.

At a possible risk of administrative inefficiency when the industry processes the switch, it's always possible to start off with one platform that didn't charge deal by deal if investing small but frequent amounts into OIECs and then move elsewhere if the fees as a % of worth became significant.

iambic
Posts: 5
Joined: October 11th, 2018, 1:22 pm
Has thanked: 1 time

Re: Managing (or avoiding) multiple S&S ISA accounts

#173060

Postby iambic » October 11th, 2018, 3:58 pm

Alaric wrote:
iambic wrote:Maybe I'm missing something, but it looks like some other platforms charge less than £10 (iWeb appears to charge £5 per deal for instance)?


If you think in terms of investing always at least a four figure sum, a charge in the range £ 5 to £ 20 is just small change. What you don't want is the platform helping itself to a percentage of the total worth once there's a reasonable amount there.

At a possible risk of administrative inefficiency when the industry processes the switch, it's always possible to start off with one platform that didn't charge deal by deal if investing small but frequent amounts into OIECs and then move elsewhere if the fees as a % of worth became significant.


Thanks Alaric, that makes sense. I've got little enough in Fidelity that it's probably worth sticking with them for now (being charged 0.25% platform fee as access them through Cavendish Online) & wait until I've built up some more significant funds (OEIC's). Hopefully by then I'll feel more confident about buying shares to start some sort of HYP, then I can look at shifting to a different provider.

The more I learn about investing, the more I realise how little I know! :?

JohnB
2 Lemon pips
Posts: 235
Joined: January 15th, 2017, 9:20 am
Has thanked: 5 times
Been thanked: 50 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173080

Postby JohnB » October 11th, 2018, 5:12 pm

Have you read Lars Kroijer's "Investing Demystified"? Its worth reading that and decide if you have an "edge" before moving away from index funds into developing a HYP

Tim Hale's "Smarter Investor" book is good too

iambic
Posts: 5
Joined: October 11th, 2018, 1:22 pm
Has thanked: 1 time

Re: Managing (or avoiding) multiple S&S ISA accounts

#173200

Postby iambic » October 12th, 2018, 8:24 am

JohnB wrote:Have you read Lars Kroijer's "Investing Demystified"? Its worth reading that and decide if you have an "edge" before moving away from index funds into developing a HYP

Tim Hale's "Smarter Investor" book is good too


Thanks John, always nice having books recommended & I've got both those books on my Amazon wish list so will hopefully get to reading them soon.

tramrider
Lemon Pip
Posts: 67
Joined: November 4th, 2016, 5:09 pm
Has thanked: 50 times
Been thanked: 11 times

Re: Managing (or avoiding) multiple S&S ISA accounts

#173469

Postby tramrider » October 13th, 2018, 12:33 pm

iambic wrote:My question (got to it at last) is about how best to manage all this, whilst keeping our money within ISA wrappers? Given that we can each only pay into one S&S ISA per year, it would be great if there was one platform that had all the funds/shares/IT's etc. that we wanted to buy.


The best site for comparing online brokers is from Monevator, but it is not simple. You need to estimate how large your total investment will be (for charges as a % of holdings/fund holdings only) and how many purchases you will make each year. Also, some charge a flat fee each year, particularly for ISAs.

http://monevator.com/compare-uk-cheapes ... e-brokers/

For example, I use
iWeb for one ISA which costs £25 to open, no holding charge and £5 per transaction
Selftrade for one ISA which costs £0 to open, about £18 per quarter holding charge for me (using it for trading charges can reduce this to zero) plus 0.3% for the funds, offset against transactions and £10.99 per transaction except £1.50 purchases on the monthly trading day
X-O holds my SIPP and costs £5.99 per transaction

I would suggest that you have one ISA for you and one for your husband. It is best to change any providers only at the start of a new tax year, and I have found it painful to transfer share holdings from one to another. Focus each ISA on a different area of investments, such as ETFs or ITs, so you can compare them over perhaps the first 5 years. Top up just a few ETFs, funds, or ITs per year, but you could add one or two new ones to each ISA per year to broaden your spread.

I find the monthly £1.50 purchase fee at Selftrade very helpful to use up a few hundred pounds of dividends each month or so as they arrive, and it can be altered to top up something different each month. I think that Halifax and others offer a similar procedure, but not iWeb and X-O.

I hope this helps.

Tramrider


Return to “How Do I Invest”

Who is online

Users browsing this forum: No registered users and 2 guests