When choosing a stocks and shares individual savings account (ISA) to invest in, you’ll want to think about how much it’ll cost you. According to Finder research, the average UK investor could lose £12,400 on broker fees each year, based on the cost difference between the most expensive and cheapest providers. How much you can save will depend on how much you invest, your chosen provider and the type of portfolio you choose, including whether you choose a fully managed portfolio or an ethical portfolio (or both).
In addition, the way you’ll pay fees will depend on whether you want to build yourself a portfolio or would prefer something ready-made — ready-made options tend to cost a small percentage of your invested amount each year, while DIY platforms charge based on your individual trades (i.e. when you buy and sell an investment).
To find the cheapest stocks and shares ISA for both ready-made portfolios and DIY investing, we’ve compared the fees of stocks and shares ISAs, including with ready-made portfolios and that offer DIY investing, with some providers offering both. You can see the full list of providers we’ve compared as well as ranking information below.
Ready-made ISAs typically charge you a small percentage of the amount you invest for creating and managing your portfolio on your behalf. With some providers you’ll pay a smaller percentage when investing larger amounts, so we’ve found the cheapest ISA when investing £1,000 and £10,000.
There may be additional fund fees, which is what the fund providers (the investment providers that provide the funds that the ready-made portfolios are made up of) charge for the fund maintenance. Sometimes this is included in the overall fee — check on this when choosing a provider.
At the moment, the cheapest ready-made stocks and shares ISA when investing £1,000 is ‘s, with an annual fee of . You can choose between portfolios and there’s a minimum deposit of .
When investing £10,000, the cheapest ready-made stocks and shares ISA is ‘s, which has an annual fee of . With you have a choice of between portfolios and there’s a minimum deposit of .
There are a number of commission-free platforms available, which means that to make a trade you don’t pay a fee to the provider, aside from any stamp duty land tax. However, if you’re purchasing any shares listed on any overseas exchanges, you’ll likely have to pay a foreign exchange fee, so the best way to compare fees is by looking for the lowest foreign exchange fee on commission free platforms.
At the moment, the cheapest is with . With , you’ll need to make a minimum initial deposit of .
Broadly speaking, there are two different types of stocks and shares ISA — DIY and ready-made — the one you’ll choose depends on how hands-on you want to be with your investments.
Do-it-yourself or self-managed stocks and shares ISAs let you choose every aspect of your portfolio, down to the individual company shares you’re invested in. You pick each one yourself, choose how it’s weighted and manage it all yourself.
When you’ll pay fees: You’ll pay a fee every time you buy or sell an investment. This fee is the commission. You may also pay a foreign exchange fee on top of this.
Ready-made stocks and shares ISAs let you choose a portfolio that’s been pre-made, hence the name. There are a few different types to choose from, depending on the range that your chosen provider offers.
When you’ll pay fees: These providers typically charge an annual fee, sometimes called a provider fee or an ongoing fee. This is worked out as a percentage of the amount you invested and can sometimes be reduced at certain thresholds.
Commission. This is the fee the platform will take when you buy or sell something – kind of like eBay taking a cut when you sell your stuff. The average commission on a UK share is around and for US shares is .
Foreign exchange fee. This is the fee for exchanging your British pounds into other currencies. Providers can charge vastly different rates here, but the average is about .
We have a comprehensive guide on investment fees, if you’d like to learn more.
How much you’ll pay for your stocks and shares ISA depends on your chosen provider, the type of investments you want and how much you invest. We’ve worked out average amounts for £1,000 invested and £10,000 invested to account for any lower fees for higher deposits.
To invest up to £1,000, you’d expect to pay on average around annually in fees, which works out as per year for £1,000 invested. Platforms that charge more will offer more functionality, may have more intuitive apps and might have a larger range of portfolios available.
When investing £10,000, the average fees are a little lower, at . You can expect to pay around for £10,000 invested.
If you’re using a DIY platform. You’d expect to pay around in commission and in foreign exchange fees.
Here are the cheapest stocks and shares ISAs when investing yourself and when choosing a ready-made portfolio:
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
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