Investment & Investing

Can open a S&S ISA with someone like Vanguard. Fees are minimal (0.15%) and it’s straightforward

I could but that's another account somewhere else. I'm trying to simplify my life :)

I wonder, is it possible to take the shares but then stick them into my SIPP as shares somehow rather than take the cash and then buy shares in something else?

I could but that's another account somewhere else. I'm trying to simplify my life :)

Fair, I transferred my SIPP to Vanguard for the same reason

What's a good fund/ETF pick for a little one's ISA with Fidelity, which won't be touched for at least 18 years from now?

In this exact situation (2yr old kid, Fidelity) I picked HSBC FTSE All-World Index Fund C GB00BMJJJF91 per here: https://monevator.com/best-global-tracker-fund/

(Yes, I only really take advice from Monevator but it seems solid to me)

Note that opening a SIPP for your little one is also a good option. You put in up to £2880 per year and gov top it up to £3600. Invest as you see fit.

This seems like the best option. Get them into SIPP, sell and buy shares in something you see growing. Ask your SIPP provider how this can be done.

If the cash is more or less the same value as the shares, and there's no tax advantage either way, why not just take the cash and bung that in the SIPP?

Whichever tracker you can get with the lowest total fees, ideally. Global tracker to be well-hedged, UK if you have Union flag underpants, and S&P 500 if you expect US hegemony to continue and want a slice (that one's also a one-way FX bet though).

Everything I can see online suggests you have to sell the shares and then use the proceeds to buy them back inside the SIPP wrapper. No idea why, maybe it's just so they can track contribution value unambiguously.

One question about the shares I didn't see mentioned: do they pay dividends? If you get a return that's higher than savings rates, it's worth something even if the value isn't going up.

An option to buy shares that is out of the money is normally worth nothing, so taking the cash would be sensible. If you would be taxed at your marginal rate on the cash but not on the shares that might be a factor. You would get taxed eventually but at a time of your choosing - eg when you take half a year off to go for the round the world record.

A stocks and shares ISA is virtually identical to a SIPP - just a different legal framework. You can hold pretty much the same investments in either (with some exceptions) - funds, shares, etc.

Most SIPP providers will also have an ISA. eg I use Iweb and they are just two different sections in my account. I pay a quaterly fee for the SIPP but there isn't any specific fee for the ISA, just commission, etc. Other brokers fee structures vary, comparision table here:
https://monevator.com/compare-uk-cheapest-online-brokers/

I would definitely go for a low-cost tracker. Main decision is what you want to track, either the UK stock market (ie FTSE) or a global index.

We have a Vanguard FTSE tracker for our daughter. @Matt101 's option is a global one. 'Global' basically means a lot of US, a bit of Europe and a sliver of emerging markets. Either makes sense.

I've asked them about it.

"I can confirm that it is not possible to deposit shares (in the form of a share certificate) directly into a SIPP."

I'm making the assumption that there is a tax advantage in taking the shares. I guess that's still a benefit and likely to see tax applied, but when would it be applied I wonder? How do they tax shares and if I moved it straight into a pension fund (if possible) would I avoid that tax or at least delay it?

I see no mention of dividends in the emails related to this scheme but if you poke around the internet for share info it looks like it does pay dividends: 3-6% yield

If I took the money, I could be getting similar interest paid on it though I guess?

go for the round the world record.

Oh god, not more silly ideas! :D Luckily I view that record as untouchable, physically and financially.

Good point, my SIPP provider (ii) does have an ISA feature. I guess the question is, is it worth the hassle? It's ~£9k worth of shares or cash. I don't "need" either right now so it sounds like the shares might be more hassle to sort out but worth a bit more in the longer term.

"When you open a Stocks & Shares ISA you will start on our £4.99 a month Investor Essentials plan. Should your investments grow above £30,000, you will move onto our £9.99 a month Investor plan." £60 per year to hold 9k worth of shares. High Street bank would be cheaper than that (0.25%+0.25%), at least while the contents remained low.

Oh, there might be a discounted fee since I already have the SIPP with them

EDIT: Looks like I've already got the option of an ISA

Investor + SIPP
£19.99/month
Our most popular option, with your first trade free each month.
ISA
Trading Account
Junior ISA
SIPP + £10.00
Free regular investing
Friends & Family + £5.00
Free monthly trade

Commission costs
UK Shares and Funds, US Shares
£5.99
Other International Shares
£19.99
Dividend Reinvestment
£0.99

that seems like an awful deal with those fees, especially with them increasing as you save more
"we're making more money out of you now. As thanks, please pay us more too"

Just move the SIPP over to Vanguard and open an ISA there too. They'll manage the paperwork for you on the SIPP transfer too

(not just me promoting them. They always get the recommendations on MSE, Which etc.)

They're going up in September too (although trading costs are going down).

But I am very lazy and change is hassle...

Changes (by plan)
Current
From 1 Sept Investor Monthly subscription fee
£9.99 per month
£11.99 per month

Do you know what the Vanguard fees are? I don't really do "trading", it's static so it probably does make sense to move it somewhere with the cheapest fees.

Vanguard is % based so it depends on how much you have invested. It's all in that table I linked to above. The best option will depend on size of your portfolio. Look at the right hand column 'best for...' which gives a steer on which ones are likely to be worth looking at.

"Vanguard Investor 0.15% <£250k, 0% >£250k. Max £375 Tiered fee charged on sum of all accounts £0 £0 at fixed times, otherwise £7.50 n/a £0 £0 Cheapest for small investors"

Vanguard fees are low, but I think they'll only hold their own funds in either their ISA or SIPP wrappers, so it won't work for your shares. That also means that transferring your existing SIPP will basically mean selling everything and re-buying Vanguard funds (unless it's all in their funds already).

Their fees are 0.15% for running the account, and something usually around 0.2% management fees for the funds.

So Vanguard are charging you more for having invested more because they're charging a % rather than a flat fee. Basically over a certain amount I will be saving money compared to Vanguard I guess.
Plus I'm not locked into Vanguard funds.

They are capped at £375 as @frank9755 mentioned, so it actually gets cheaper as a percentage above 250K invested. But honestly their rates are very low in the first place.

I transferred a SIPP there from Hargreaves Lansdown who were charging 0.45% for doing basically nothing, and the fund management fees were higher too (so I didn't mind liquidating in that case).

I dunno, from what I can see in Frank's table, ii seems cheaper than Vanguard still. Maybe if I cracked 250k mark, it would swing back in Vanguard's favour?

From what I can see, given I'm paying the £19/month for ii. I think their ISA might be essentially free with my existing SIPP.

I'm sure Which do a better summary than I can. They do a table showing the fees when you have £x000 invested. but I don't have the subscription to see that

https://www.which.co.uk/money/investing/investment-platforms-and-fund-supermarkets/investment-platforms-reviewed/interactive-investor-investment-platform-review-ahppn5R4m0Pk

Who is Interactive Investor good for?
Interactive Investor offers a cost-effective service for those with portfolios worth £50,000 or more, combining fixed fees with a respectable customer score. However, it's not among the highest-ranking platforms.

If you want to trade funds regularly and have a smaller portfolio, Interactive Investor may prove more expensive than most.

With its cheapest plan, Essentials for portfolios under £30,000, you can pay just £4.99 a month to hold your funds and shares with Interactive Investor, but you get no free trades as you would in their other plans. So, for investors who want to trade regularly, these costs will add up to make this option less worthwhile.

In this scenario, you might want to consider a platform with a percentage-based fee, such as AJ Bell or Vanguard.

.

Who is Vanguard good for?
For those with portfolios worth less than £100,000, Vanguard's simple, percentage-based fees are the cheapest option for buying funds. It's also still one of the cheapest platforms for larger portfolios.

However, for portfolios holding more than £100,000, it's actually cheaper to hold Vanguard funds with a fixed-fee broker, like Interactive Investor or Halifax Share Dealing. For Vanguard ETFs, it would always be cheapest to hold them with InvestEngine who charge no fees at all.

As Vanguard only offers around 80 of its own funds, investors looking to buy other funds, investment trusts or company shares will have to look elsewhere.

Yeah, so I think I'm better staying with ii. I'm going to wait and see what they say about bringing shares into an ii S&S ISA. If they can't do that I reckon I'll just take the cash and buy a Crux.

"The monthly subscription for our Investor Essentials, Investor and Super Investor plans includes an ISA, which means you can add one for free."

If I add a S&S ISA before the end of the month I get £50 trading credits too. But if I can't bring the shares in, there's not much point.

Just shooting from the hip and without looking into the details, ii has always been one of the cheapest ones. I think they got a bit more expensive recently, and maybe will edge up a bit more. They may not be absolutely the cheapest but probably not a bad option, and probably not worth switching away from them.

HL are really expensive, coming from the full service broker end.