Vanguard vs Hargreaves Lansdown

[whataboutbob]

I have some money to invest in a S&S ISA (£10000) and am shopping around for funds. These two come up regularly in these threads. Looking across the companies, it seems that 1) fees are higher at H.L. around 0.45% vs 0.22 % at vanguard.
2) Risk seems to be allocated differently ie at HL conservative/ low risk is 45% shares 50% bonds 5% other. At Vanguard low risk is 20% shares 80% bonds
On the face of it Vanguard seems a better bet. Am I missing something? To mitigate risk is it better to spread investment across a few companies in case one goes tits up, or does it not work like that? Thanks for any advice/ insights.

Vanguard until recently has been a fund house. They entered the UK platform market a year or so ago.

Platform fees: HL 0.45%. Vanguard 0.15%
So quite a bit of difference. HL offers thousands of funds to pick from, Vanguard offers only their own and a only a subset of their own.

I would start by choosing a fund. Then if your chosen fund is on the Vanguard platform open an ISA there as the overall cost is lower, whilst the amount you have invested is quite low. Once you have £80k ish invested, then shop around for a platform - Interactive Investor, iWeb for example can be lower cost for higher value portfolios.

Thanks nannynick I was hoping to attract a response from you! I’ve been listening to the Meaningfulmoney podcast but still have much to learn! Just found Which?s platform comparing website which is useful. For example, AJ Bell scores better than HL on charges.
I think I’ll keep it simple and go for a Vanguard life strategy, 20 or 40%.

I would go for a cheaper platform and then select from different funds. My vote goes for Fidelity, good interface and selection of funds including Vanguard.

Thanks @savvy. I think part of the problem is the sheer amount of choice. I have given myself till the bank holiday to commit. Whatever I go for has to be better than the ridiculous 0.1% I’m getting on my cash isa at present- in the long run.

A few years ago (before Vanguard Investor platform existed) I started with HL. Their app is great, the fees seem low when you have a small amount invested. You get a lot of choices of funds to invest in - too much choice!

After being there almost 2 years I moved to Vanguard Investor, as it was lower cost and I had by that time learnt that all I needed was a multi-asset fund with good global diversification.

When I need to get more advanced then I may need to change platform again but when starting out I would keep things as simple as possible and as low cost as possible.

@whataboutbob Are you a Which member? I cannot find the comparison you mention but have found some pages on the Which site about comparing investment platforms.

Good to hear you are enjoying the Meaningful Money podcast, I found it a few years ago and Pete is great at conveying information in a way that is understandable.

Anyone reading this who has not heard the podcast, start with this episode from last year aimed at beginner investors:
meaningfulmoney.tv/UG4

Actually today's episode may be very useful for anyone new or thinking of investing. meaningfulmoney.tv/newinvestor

What I like about Vanguard is that you can just open a S&S ISA and then divide your pot amongst the risk levels.
I have 75% of my ISA in the 60/40 bonds/equities, 10% in the 100% equities fund, the rest is split between two accumulation ETFs at the risk level 5. My direct debit is set to purchase the safer option, whilst any extra money I can put in I tend to go for higher risk/bigger potential returns as this is money I wouldn't have otherwise had, such as my Grand National win, unexpected bonus from work etc.
It's very interesting and educational comparing what is doing best etc.
I have £40k in an ordinary savings account and it earned 34pence interest last month so I'm extremely pleased with my Vanguard account.

Thanks for the extra info @nannynick, it is looking like Vanguard is probably the right platform for me at the moment. Here is the comparison table in which, hope it links ok
www.which.co.uk/money/investing/investment-platforms/investment-platforms-reviewed/best-and-worst-investment-platforms-anyxw2k9cdz8
@TigerTulip I admire your style, I am a bit of a risk averse wimp! But I am so fed up with the ridiculously low interest rates in high street “savings” accounts I am taking the plunge, but probably with 20 and 40% equity funds.

Looking forward to today’s meaningful money podcast!

I switched from Hl to vanguard a few years ago and much prefer it. They have a great range of life strategy funds which are low cost and diversified. I would also recommend having a look at Boring Money , it’s a brilliant no nonsense website with great comparison tables that cover all the main investment providers and you can sign up for a brilliantly funny and informative newsletter which I look forward to ever Friday, well worth a look for practical advice.

@whataboutbob Thanks. For non-subscribers the first column (provider names) of the table is hidden but I guess Vanguard is near the top if not the top one.

Yes that’s right it’s their top platform. Didn’t realise it was hidden.

I am new to the Vanguard platform and can recommend. Just received an email from Vanguard introducing their new service has anyone used it?

If Vanguard are No 1 out of interest who are are No 2 in the Which platform chart ?

@Alwayscheerful it’s AJBell Youinvest. Me neither .

What do you mean spread money around different companies?

Hargeves is a platform to invest through as is vanguard

Aside from fees ect its the funds within each platform that your spreading your ££ around in eg you can buy a vanguard life stragety fund through hargreve, within life stragety fund your money is invested in loads of sectors and area, smaller narrow funds like Lindsell train.
Within each company I have different investments.. I'd like to use the vanguard platform and I may as I get older, but at the moment I use Hargreaves.

Thanks, I just thought if a company eg Vanguard goes belly up, you haven’t lost all your money if you’ve used different companies/ Platforms. But I see that the government would guarantee up to ( I think) £90000. I didn’t realise that, I thought it was just banks where the guarantee applies. I’m very much learning as I go along.

Ok, I don't think that's an issue but who knows! As you say money up to certain amount is protected, you are allowed two isa, one cash reliant on bank interest rates and one stocks and shares.

Vanguard is huge company with I'd say principles... It was founded by a man who seemed to have integrity anyway, Jack bogle.

If your worried perhaps look at how much they are worth?

Vanguard is huge in the US. The only reason I don't directly invest on their site is Because I want access to other funds not soley vanguard.

DH uses HL and has money in funds across uk and emerging markets. I use Interactive Investor because I like to choose individual shares (I like reading the business pages in the newspapers to help me choose). I don't often go outside FTSE100

Wriggle you can buy individual shares through the usual platforms too why do you use interactive investor?

I have some individual shares along side the funds and trusts in mine and dc isa m

Op re vanguard funds it's usually on age and how long you want to invest for, I'm 40s I'm in 100% equities and one is 20/80 to equities as you get older start to increase the bond side because its more stable and if there is a crash near when you want to spend the money, it won't be lost eg before covid crash if money in bonds its more stable.

Thanks for that @Puttingouthefirewithgasoline, I am 54. I was going to go 50:50 and open one 40% and one 60% vanguard fund. But I see I can only open one stocks and shares ISA per year. Now this is probably a very silly question, but each lifetime strategy fund counts as one ISA right? So I can only open one of those?

Your isa is the wrapper, you can only have one stocks isa but within the isa wrapper you can hold as many funds as you like, you could have each vanguard life stragety if you wanted or and buy individual shares as well and have other funds like fundsmith.

• caveat, I'm not sure if your allowed to open a whole new isa every year with different providers? But I'd not see the point.

In my H&L isa.. I hold vanguard life stragety and Scottish mortgage and several other funds as well as index trackers and some individual shares.

When you get used to looking at tables and what's in each fund you will learn about how each fund is weighted eg.. Across all investment sectors but perhaps mostly in US?
Or across the world but only tech companies.

Vanguard site is very good as a starting place to see what's in the life stragety funds.

People may say opposite but at 50 I'd still go 100% equity and minimum 80/20 equity?

Op I think your confusing the vanguard platform to buy its own products with the h and l platform where you can buy its own but also lots of others including vanguard funds.