As a FTSE 100 company, Hargreaves Lansdown is a secure financial organisation with over one million clients and with £86bn entrusted to it by investors, employing more than 1,000 people. Are Hargreaves Lansdown fees competitive? Let's take a look with an investment comparison.
- User-friendly platform
- Wide range of accounts
- Competitive charges
- Global market access
User-friendly platform
Investment doesn't have to be a difficult process, and in this Hargreaves Lansdown review there is information that investors can use to make decisions on whether or not the company is right for them. Hargreaves Lansdown offers a platform that gives investors flexible ways of choosing from a wide range of global investments. With more than 2,500 funds to select from, including shares from Europe, the UK, Canada and the US, there is a wide range of options.
All investments can be held in one of the company's Vantage accounts, allowing investors the freedom to make choices and, if they think that something else will give them a better return, to switch their investments to a product that will potentially have that better return. Investors can also take advantage of the rigorous research undertaken by the company, using the Wealth 150 list that Hargreaves Lansdown's research team considers will offer the best investment prospects over the long term. There is a range of multi-manager funds, which give investors a single investment that provides a managed portfolio that is well-diversified. The platform also provides a variety of guides, calculators and research, so investors can choose wisely, decide on planning for the future and save tax. In addition, people who require personal advice can contact one of the financial advisors for help and can also learn more about Hargreaves Lansdown charges.
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Wide range of accounts
The Vantage accounts allow investors to hold their investments in the account of their choice or in more than one. As the UK's number one investment house, investors may consider Hargreaves Lansdown as the best investment broker for their needs. One of the most popular accounts is a Stocks and Shares ISA, where investors can get tax-free growth on their investments. Up to £20,000 can be put into this account in the current tax year, and there is no additional UK tax on income. Money can be accessed at any time, and this ISA is a straightforward and tax-efficient way of investing. Another popular investment vehicle is the Ready-made ISA portfolio, where investors can choose whether they want to invest for growth or for income, assess what level of risk they are comfortable with, and then decide how much to invest.
Hargreaves Lansdown charges for this type of ISA have a maximum service charge of 0.45% on the first £250,000 of fund value, reducing as the funds value increases and with no charge on the value over £2m. It is free to set up the account. Other products include a Fund and Share Account that has no investment limits, does not charge if you hold shares and has the same Hargreaves Lansdown fees on fund values as for the Ready-made ISA.
Competitive charges
In a fast-moving financial world, investors want to know they are getting value for money, so it's important to look at an investment broker comparison. Different brokers offer different services, so before making a decision, investors should research what added value they can get from the broker they choose. Not all brokers offer the same services, so what may appear to be higher charges from one broker could be value for money due to the range of services offered. Hargreaves Lansdown fund charges start at a 0.45% admin fee for an ISA, and this is capped at £45 for shares, trusts and ETFs. Fund dealing is free, and there is an £11.50 charge for standard share, trust and ETF dealing. There is a £1.50 charge for regular investing and a 1% charge for dividend reinvestment with a £1 minimum and £10 maximum. Comparing this to Alliance Trust, there is a £10 per month admin fee (thus £120 per annum), and this includes four free trades a year.
Fund dealing costs £9.99 compared to Hargreaves Lansdown's free deal, and it's £9.99 for standard share, trust and ETF dealing. Both companies have the same regular investing fee of £1.50, with Alliance Trust charging a flat fee of £5 for dividend reinvestment. Admin charges from AJ Bell are 0.25%, and there are no admin charges from Frequent Trader, which seems an attractive offer. Broker fees can be complicated, so it's essential that investors are clear about what they will be paying out.
Global market access
Markets are volatile, and when a negative tweet from the President of the United States can send share prices in a company plummeting overnight, investors can be forgiven for being cautious. Yet although the US is a huge player in the financial markets, it is by no means the only one. As an ‘investment supermarket', Hargreaves Lansdown is able to offer access to global markets for individual investors, no matter what type of Vantage account they decide to choose. The company offers the opportunity to invest in more than 2,500 funds that span the US, UK, Canada and Europe. These funds include shares, Exchange-Traded Funds, bonds, gilts and investment trusts, giving investors a remarkable range of options. As stock exchanges in different countries open and close at different times, it's important to know that an investment organisation has tabs on markets globally.
Investors who use the Hargreaves Lansdown platform can access their investments at any time, so they can more easily manage their investments and pensions. An important aspect of working out what will be the best way of investing in one of the Vantage accounts is to check what Hargreaves Lansdown exit fees may be when looking to move investments to another company. It's also important to bear in mind that whatever investment vehicle is used, the value of investments can go down as well as up, but using the Hargreaves Lansdown platform should keep investors abreast of any potential problems in the market.
An award-winning company
When it comes to deciding which investment provider is worth serious consideration, it's a good plan to look at the number of awards the company has won. For Hargreaves Lansdown over the past 18 years, this runs into close to 200 awards, a considerable achievement in a highly competitive field. One of the company's earliest awards was in 2000 when it garnered the ‘Money Management Financial Planner of the Year – Overall’, and the company hasn't looked back since. Miscellaneous awards include ‘Fund Strategy Magazine Fund Strategist of the Year’ in 2001 and 2002, but the company has not rested on its laurels. Awards have rolled in year on year, and in 2017 Hargreaves Lansdown scooped an award from Management Today as one of ‘Britain's Most Admired Companies’. Alongside this, Investors Chronicle gave it awards as ‘Best Investment Platform’ and ‘Best Stockbroker for Customer Service’, helping to cement its successful image in the world of investment finance.
2018 has seen more awards, claiming ‘Best Online Presence’ and ‘Regional Wealth Management Company of the Year Wales and Western England’ at the City of London Wealth Management Awards. The range of services and products that the company offers has undoubtedly impressed those in the financial sector who make comparisons and judgements about the quality of a wide range of investment businesses and has put Hargreaves Lansdown high on the list of companies that can be trusted to do an excellent job for its investors.
How safe is investors' money?
Hargreaves Lansdown is a Plc, and being in the FTSE 100, the index of the UK's biggest listed companies, has a solid reputation in the financial world for its work on behalf of private investors and is regulated by the Financial Conduct Authority (FCA). The company looks after over £82bn of assets for its clients and has grown its business organically rather than by buying other businesses. The focus is solely on providing investment services to its clients and the company does not buy or sell investments for its own benefits, making its money through Hargreaves Lansdown charges. Thus the business has to provide a high level of service to its clients and ensure that investments they make perform as well as possible.
The company does not act as a bank and states that it is managed conservatively and has a long-serving employee base. Growth has been achieved without the need for borrowing, and the company has strong audit procedures and internal controls. It's well known that some institutions in the financial world have had serious problems in the past due to poor controls – think of the banking system that was close to collapse in the crash of 2008 and the difficulties that many of those banks have had to return to profit. With the various checks and controls both internally and externally, Hargreaves Lansdown appears well placed to safeguard its investors' money.
Personal advice
Although many investors may be happy to use the tools at their disposal on the Hargreaves Lansdown online platform to learn about investment opportunities and to keep track of where they have put their money, there are others who may be unsure about certain issues and need personal advice. There are a number of ways that the company's team of financial advisors can help, and it can be done over the phone or face to face, depending on preference. The key to good advice is to help save the client time and money, so there is the opportunity to explore options or ask for help on a specific topic of interest already identified. There are many different ways of investing, and some will be suitable for some investors but not necessarily for others. If one takes pension consolidation as an example, this could be an area where the right advice could be very important for an investor's future retirement plans.
Many people may have a number of pensions, often with different rules that apply to them. It can be complicated and time-consuming to work out what is the best way forward, and an advisor can help an investor determine whether or not to consider pension consolidation and flag up any potential risks that relate to guarantees, benefits or high exit fees.
Our verdict on Hargreaves Lansdown
As the UK's number one investment company, this multi-award-winning investment business offers a very wide range of support for both new and experienced investors through its online tools and with back-up from personal advisors. As a FTSE 1000 company, it has a secure financial base and a reputation as a solid performer in the financial industry. The products in its Vantage accounts give plenty of options for investors to pick and choose what they feel comfortable with and to keep abreast of how their investments are performing at any time of day or night. Hargreaves Lansdown charges are not the cheapest on the investment market, and there are alternatives which offer better value for money.
However, the company offers many services that other investment companies may not. It's important to check on Hargreaves Lansdown exit fees if investors want to move to a different investment platform, but the popularity of the company's offers and the fact that it has over £80bn under its management means that it's certainly worth exploring if its ethos and investment options are a good fit with what a potential client wants from the organisation.
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