Calculating fees - Fidelity S&S ISA

[Boobtasticmumma]

I FINALLY, at the age of 51, am financially independent and am able to at last able to put a teeny amount away each month, alongside transferring into a S&S ISA a small amount from a Fidelity ‘growth’ account. I have a little experience but would be grateful if someone could breakdown the language of fees and charges so I can understand it completely clearly please.

I have investments already with this company and know which funds I wish to invest longterm into.

Thankyou.

As a general overview you pay 3 types of fee.

Platform fee. Varies from platform to platform. Some are a flat rate, some are a percentage of your total holding with the platform.

Fund fee. Annual fee charged by the individual investment. From around 0.1% upwards depending on the fund. Passive investments generally cheaper than active.

Dealing fee. What the platform charges for buying or selling an investment. Many charge different amounts for different types of investment, or for regular vs one-off trades. This is what the questions in the screenshot are about.

I’m trying to work out what fees I would incur by:

Depositing £3k initially

then

Depositing £25 monthly

Buying 2 funds each month

I am out of an extremely lengthy financially abusive relationship and am
limited in understanding the terminology used.

For that amount, with a regular monthly investment, Fidelity will charge you a 0.35% platform fee.

The rest depends what you invest in. You can avoid dealing fees by sticking to funds in the first category.

The individual fund fee you'll need to look up.

Why are you buying 2 funds?

If you know which funds, and are happy to say , we can work out the fees.

Oh heck 😳
and this is why I’m on here. Thankyou. If it’s not worth it (I’m a basic tax rate payer) or it’s more financially economical to buy just one, then I’ll do that.

Scottish Mortgage Investment Trust

and

Fidelity Multi Asset Allocator Adventurous Fund W-Accumulation

The investmemt trust comes under the 'shares' box above, so there are trading fees for that. And it's actively managed so is likely to have a higher management fee.

The Fidelity fund I think comes under the 'funds' box, so no trading fees.

I'll have a look at the documents and be back in a bit.

Right.

You're under £25k total holdings, so that means it's £7.50 a month (£90 a year) for the Fidelity platform charge, not 0.35%.

Investment trusts have a flat rate of £90 a year under £25k. I'm not sure if that's additional to the general platform charge - you'd need to do some more digging on that.

The Scottish mortgage then has a management fee of 0.32%, and a trading fee of 0.07%. This is each time they trade within the fund, not when you buy/sell the fund as a whole. A quick scan of the charges documemt suggests this comes to about 2.3% total.

I'd ditch thee ivestment trust and stick with the funds that don't have extra charges.

Are you set on Fidelity or would you consider other platforms?

And are you certain about the 'adventurous level? That's nlan unusual risk level for a small holding and an inexperienced investor.

Actually, on regular monthly investing you might escape the minimum charges and be able to get the platform costs down to 0.35 plus £1.50 for investment trusts trades and £0 for fund trades. But that would limit your ability to pay in any lump sums. They don't have the clearest fee structure.

AJ Bell's Dodl or Vanguard might work out cheaper for you. Or something like Invest Engine which doesn't have platform or trading fees, but those free ones are often not the easiest to navigate.

Morning,

Sorry for the delay in acknowledging you - thankyou so much for all this info.

Realistically I won’t have any lump sum to deposit other than this initial £3k I now have.

I do have a SIPP with A J Bell which I find easy to navigate.

I have been watching the Accumulation fund for years and it has volatility, you’re right, I thought I would throw caution to the wind a little having been so restrained previously, and put it with a strong performing trust like SMT.

Wish I had your brain and the ability to calculate these figures!!

You can do it, it just take a bit of practice and knowing where to look.

If you're comfortable with the volatility, that's great - it can mean better returns if you hold your nerve.

If you already have an AJ Bell SIPP and are familiar with the platform I'd put the ISA in there as well. Their platform fee is lower than Fidelity for the amount you have, and you're already paying it. Adding an ISA won't cost extra. It's easy enough to move later if you want, and around the end of the tax year there are often good incentive payments for doing so.

My understanding is that the 0.07% transaction cost is an annual cost which may vary from year to year and that SMT is considered to be a low cost for a managed fund - which doesn’t tally with your suggestion that the fees come to 2.3%.

That was what I thought until I read the documents, which had illustrations around the 2.3% mark. As I said, though I only gave them a quick scan so may have misread that bit.