Hi, after over 20 years have I only paid any attention to my actively managed ISA portfolio of 45k at 1.75% annual charge.
I am kind of two minds about leaving it, or transferring to IE as I plan on cashing it within the next 5/7 years. Obviously my shocking concern is the amount of charges. However transferring it will require selling the shares, and getting less and then reinvesting as they are individually picked shares.
I know this is not a financial advice, just your thoughts between the two options, bearing in mind, I intend to cash in 5/7 years time. Thanks
I would suggest switching will save you many thousands. Those fees are very high. You can replicate the same investments most likely on Invest Engine if that’s what you want to do.
Do they earn their fees? Personally I would get the last 10 years of annual statements and see if they had beaten the MCSI world index (or perhaps the S&P ). If it had not then I would probably encash and\or transfer out.
If you did not want to sell, you would need to find a platform like ‘Interactive Investor’ who would be able to hold the individual shares for you. The custody\platform fees there are still going to be 0.66 % ish. So some saving on fees.
Rather than be a forced seller, you could take you time to sell individual shares at better prices and then perhaps transfer here at a latter time. ( although that might have its own risks and time costs ).
Do the math…
The effect of compounding costs is killing your wealth building.
We can’t control much when it comes to investing, but we can control how much we pay in fees
Thanks all for the replies. I’m swaying more towards selling due to the ongoing charges. I might just sum up some courage to have a good go at DIY portfolio. Am I right that it can be transferred over to a cash ISA, and I can gradually invest lumps over a period, rather than in one go. Any thought?
You should transfer your ISA, then sell the shares, and then invest the resulting cash all at once. Lump sums are more effective than monthly contributions if you are able to do so.
What you invest in is up to you, and if you’re looking at cashing it all in within 5/7 years, you might want to think hard about the usual suggestion of the FTSE All World. Although I note that five years is often thought of as the minimum ‘safe’ period for investing money.
My point is not to advise you on stocks vs bonds or whatever else you want to invest in, it’s to say that if something is in an ISA wrapper, you should not take it out of that wrapper because it’s tax free and you can only put up to £20k a year in it.
You can (and probably should, given the high fees) transfer away from your existing provider though.
. This is starting to feel scary. I could do 50/50 stocks and low risk investment like bonds right. Thanks