Another broker changes their fees….

So I fear that this post is going to end up in more of a rant than anything that may possibly make sense, so please do indulge me and put up with it 🙂

It’s just over a year now since I opened the Go T’ Pub ISA with Selftrade. Whilst their website is a little on the basic side, it worked very well for me. I paid a £1.50 per trade for my regular order and for any dividend reinvestments, and that was it. No other fees – a truly cheap price for using their service.

The perfect fire and forget strategy… or so I thought.

Out of the blue yesterday evening I get an email via their secure inbox to me. Note: not to my registered email address, but to my selftrade account. This means to read it I have to log in, look out for the tiny mail icon just above my account logo and click on there to read it. Nothing else to tell me I have a message. At least with premium bonds they email me to tell me I have a message.

Out of the blue they are announcing a new pricing tariff – effective from the 1st July 2018. I can’t believe they didn’t know about this plan before the new tax year so I can only assume they have deliberately waited until now to notify people.

This really annoys me as I have now made an ISA contribution to them, and so I need to research if I am able to move my ISA without any consequences (I have enough trouble as it is with HMRC not getting my tax code right!). I’ve made one payment to them. For this I feel that they have me over a barrel.

So, what is this new tariff I (don’t!) hear you cry? They are introducing a new “custody fee”. And yes, you guessed it, it applies quarterly. They are reducing the cost of trading (if you don’t buy on regular direct debit) – which I never use. To make matters even worse, ETF trades will not change (my main purchase)

The new cost is “Up to”£17.49 per quarter. Needless to say this is fees you have to pay inside the ISA wrapper (unlike my IFA who’s fees I can pay before it goes into the wrapper).

The whole reason I chose Selftrade was their low fees, however it seems that they are now going the way of iii who took over TD Direct, and others who are charging a quarterly charge regardless.

Am I going to take action? Yes. Unlike when iii introduced their fees, I took the view that I was happy to pay them (as it offset my trading costs, and I really do like their platform so happy to pay a slight premium for it, it leaves others in the dust). For Selftrade, I am not happy to pay the fee.

Unfortunately for me, the Selftrade helpdesk isn’t open at 6am on a Saturday morning (why on earth not?! :)) so I won’t be able to do anything yet, but my clear actions are:

  1. Call Selftrade. Find out about the cost of transferring the ISA out from them to another provider
  2. Find out if, now I have started this ISA year, if I can actually move to another ISA provider (or do you, dear reader, know if I can?)
  3. Review the broker table on Monivator to find out which broker I will be moving to

My biggest fear is that in a relatively short space of time another broker is moving to a quarterly fee and that this will become the norm.

I think I need another coffee….

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Author: fireinlondon

Fighting the high cost of living in London

11 thoughts on “Another broker changes their fees….”

    1. Hi Weenie,
      Yes – I was really annoyed especially the slightly underhand way they have done it! Thanks for the link, no prizes for what I will be reading once I have a coffee in my hand!
      Cheers, and enjoy the bank holiday when it doesnt rain!

      Like

  1. @FiL – thanks for alerting me. I’m a Selftrade customer too and hadn’t spotted this announcement.

    In my case I am due to save money with these changes (hats off to selftrade for a very clear customised email to that effect – key para below). That’s my good news. The bad news is that I spent almost £700 on fees with them last year – methinks I trade more than I should!

    I am also an ii customer. I don’t consider it beats Selftrade hands down – I find them about the same. For me the quarterly custody/inactivity fee makes sense and I probably do better out of it, with >£100k of holdings with both brokers.

    Before you jump, have you considered when your funds will have grown to a level where the custody fee makes sense?

    FvL

    Thank you for continuing to invest with Selftrade; the home of DIY investing. To continue to provide you with competitive low rates and to reward loyalty, we will be introducing a new pricing tariff from 1 July 2018. As a valued customer, we are pleased to advise you that this will result in an estimated £26.60 reduction of your total annual fees from £706.64 to £680.04 p.a. based on your previous 12 months with us.

    Liked by 1 person

    1. Hi FvL,

      No problem – as I say I only caught it out of the corner of my eye, and I would have been caught out. Whilst they were very open with the charges they announced, as you say laying out what the costs are, for me as I only do the monthly direct debit, it will cost a lot more – but it sounds like you are much more active in your Selftrade account than I am 🙂

      I have >£100k in iii but I do like the simplicity of their site, research etc. that it provides which I haven’t found with ST (maybe I haven’t given them a chance and searched?).

      Yes – I will need to look into all of those things, as at some point I will change to another provider and then it will just be the dividend reinvestment, which I would have avoided before with VWRL and CTY, but now I would have to pay the charge.
      I don’t intend to purchase anything other than ETFs or direct shares (Investment Trusts most likely) in this portfolio so I will need to fire up the old spreadsheet and start plugging numbers again sadly…..

      Cheers,
      FiL

      Like

  2. Argh. They say the one thing we can control is costs. And then this happens. As you say at the end, the danger is jumping out of the frying pan. I personally ‘live in fear’ of IWeb fiddling with its prices.

    Like

    1. Hi Luke,
      Yes it really did make my blood boil yesterday, so much so I ran to the pub beer garden (well actually to be fair, the pub kind of attacked me by opening as I walked past…. they opened the doors lol
      Yes it does make me wonder if more and more are going to change to this sort of structure, so I can see me going through all this hassle only to get the thing happen a little later lol
      Cheers,
      FiL

      Liked by 1 person

  3. I am considering moving my isa direct to vanguard as I’m unlikely to hold anything other than this for the foreseeable until i have more invested but don’t know if i should keep the flexibility. I use charles stanley for the moment

    Liked by 1 person

    1. Apologies for the delay in replying, its been a bit manic! I will have to investigate the options – I want to be able to hold ETFs and shares directly, funds seem to always incur a higher charge so hence keeping clear for now…
      Cheers!

      Liked by 1 person

    1. Hi Ms Zi You,
      Its a difficult one. I looked back at my first thoughts (https://fireinlondon.wordpress.com/2017/03/24/go-t-pub-isa-provider/) to see which I should do. That was interactive investor or self trade. Well II took over TD Direct so thats a no go. Potentially AJ Bell, but I need to sit down and go through again.
      It will come down to what the differences are, so I will make sure I document all of that to show the thinking behind!
      Cheers,
      FiL

      Liked by 1 person

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