Average investing cost, subscriptions into Investment ISA.
Discussion
No, over £500,000 the charge is 0.25%. But your post reminded me, when I wrote that earlier, I had forgotten - Old Mutual operates a banding system. This would make Cavendish slightly more cheaper in come cases. If all you want to do is invest a large amount of money and forget about it completely over an extended period of time, it might make more sense. But if that was the case, you'd probably go direct to Vanguard anyway. And extending that logic, if you wanted to take income, move it around or do any number of the things that most people want to do with their money, the prism through which you interpret cost and value would probably change again.
Ginge R said:
No, over £500,000 the charge is 0.25%. But your post reminded me, when I wrote that earlier, I had forgotten - Old Mutual operates a banding system.
So you no longer use OMW?Ginge R said:
all you want to do is invest a large amount of money and forget about it completely over an extended period of time, it might make more sense. But if that was the case, you'd probably go direct to Vanguard anyway.
Well the plan was someone was going to manage it...I always consider all of them, and whether or not they are appropriate. Suitability and relevance depends on many things; whether the portfolio is mature, is there a single cogent and cohesive financial strategy (from which wealth management and all subsequent manner of enabling objectives and tactics flow and stand the test of time)?, what are the number of wrappers, the requirements, activity, servicing standards, client requirement for simplicity, and last but not least, costs (etc). Fair to say, since OMW was, effectively, put up for sale (and since CoFunds was bought), platforms are going through yet another state of flux, they are trying to save money and that is having an impact.
Ginge R said:
I always consider all of them, and whether or not they are appropriate. Suitability and relevance depends on many things; whether the portfolio is mature, is there a single cogent and cohesive financial strategy (from which wealth management and all subsequent manner of enabling objectives and tactics flow and stand the test of time)?, what are the number of wrappers, the requirements, activity, servicing standards, client requirement for simplicity, and last but not least, costs (etc). Fair to say, since OMW was, effectively, put up for sale (and since CoFunds was bought), platforms are going through yet another state of flux, they are trying to save money and that is having an impact.
You have a gift for writing impressive-looking essays without conclusion. What I actually asked was whether you still recommend OMW, because 18 months ago it was, I was assured against my better judgement, the best thing since sliced bread.Simpo Two said:
You have a gift for writing impressive-looking essays without conclusion. What I actually asked was whether you still recommend OMW, because 18 months ago it was, I was assured against my better judgement, the best thing since sliced bread.
You originally asked if I still used it, and the answer is yes. I have migrated some clients away from it recently though, but not for reasons which always reflect on the proposition. If subsequently, client circumstances change, markedly, so might the recommendation.If I feel that a client is suitable for Platform A over Platform B for any given reason (in answer to your point, above) I will always recommend it. Whether or not I have or haven't recently ("still') is immaterial, that will depend on any recent clients and their unique needs, and not dogma.
Indeed, the particular period in question ended in February.
Let's open the question to all IFAs and other experts who ply these pages. As I understand it (was advised) a platform is beneficial because (a) it is cheaper to buy/hold funds through a platform than directly (b) fund switches are free/very cheap. Are those true?
Apols if moving O/T but a platform is a significant part of 'average investing cost'.
Let's open the question to all IFAs and other experts who ply these pages. As I understand it (was advised) a platform is beneficial because (a) it is cheaper to buy/hold funds through a platform than directly (b) fund switches are free/very cheap. Are those true?
Apols if moving O/T but a platform is a significant part of 'average investing cost'.
Simpo Two said:
I was advised a platform is beneficial because (a) it is cheaper to buy/hold funds through a platform than directly (b) fund switches are free/very cheap. Are those true?
I'm not a qualified "expert" but am a long term investor. My understanding is that the answer to both of those is "true".I migrated to platforms having (eventually) discovered that if you buy direct you essentially pay "full retail price" to get into a fund, which can mean a 5% initial charge plus the annual charge. I believe this was done so that the IFA "salesmen" weren't being undercut and could continue to pocket their fat wedge. After all, you can't buy your car cheaper from the manufacturer than you can from a dealer.
My limited understanding is that, today, the cheapest place to be is on a platform and invested in unbundled funds. It seems that if you're awake and paying attention with a decent size portfolio you should be able to get TOTAL costs and expenses down to around 1% p.a. This is a significant reduction from the previous norm.
"Advice?" Buy it when you need it. I'd be as suspicious of "cheap advice" as I am of "cheap car servicing"!
I'll be interested to hear the expert opinions.
Edited by Ozzie Osmond on Friday 2nd September 23:03
Edited by Ozzie Osmond on Friday 2nd September 23:04
Ozzie Osmond said:
My limited understanding is that, today, the cheapest place to be is on a platform and invested in unbundled funds. It seems that if you're awake and paying attention with a decent size portfolio you should be able to get TOTAL costs and expenses down to around 1% p.a. This is a significant reduction from the previous norm.
Cheapest will surely be a tracker with TER of ~20bps, and buy direct.http://www.telegraph.co.uk/finance/personalfinance...
^^^ Yes, if you buy just one specific investment and hold it forever. Is that what investors actually do?
Also from the linked article, and referring back to my post above, "L&G does allow customers to buy trackers directly but does not offer the cheap variants that fund shops get; for example, its UK Index Trust will cost 0.4pc a year to direct customers."
Also from the linked article, and referring back to my post above, "L&G does allow customers to buy trackers directly but does not offer the cheap variants that fund shops get; for example, its UK Index Trust will cost 0.4pc a year to direct customers."
Gassing Station | Finance | Top of Page | What's New | My Stuff