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It’s that time of the year when investors from all walks of life across the UK start to think about their ISA pots with the April deadline looming, and the new ISA year starting.

The maximum ISA allocation hasn’t changed for the 2019/2020 period, so any investor over the age of 18 can add up to £20,000 into their Stocks and Shares ISA account in order to enjoy the tax free status of any capital growth.

Whether you have £20,000 to spare for a lump sum or you have a regular monthly transfer set up, a Stocks & Shares ISA is an important component of any investor’s portfolio as they look to build wealth.

The question is not about whether you should be investing in an ISA, or how much you should put in – that should be taken as a given. The answer is yes and as much as you can reasonably afford within the government limits.

The real question is which provider you should choose for your stocks and shares ISA.

Picking the right Stocks & Shares ISA provider is not straightforward

The thing is, a like-for-like comparison of the Stocks and Shares ISA providers is not straightforward. Some are geared towards fund investment, others towards stocks and shares while many now offer a selection of ready made funds designed to appeal to investors who either do not feel comfortable choosing their own investments, or do not have the time to spend on them. These ready-made funds, or robo-advisers, provide a range of funds that are designed to meet a variety of risk-based criteria, so investors can choose a cautious approach all the way up to adventurous.

Choosing the right provider to suit your investment needs could save you hundreds of pounds over the longer term so it is important that you get it right.

Below, The Armchair Trader team has researched 30 of the UK’s most prominent Stocks and Shares ISA providers to bring you the five providers offering the best value for money in terms of their fees for both Funds and Stocks.

Investing in Funds with a Stocks & Shares ISA

We have applied a scenario across our 30 featured stocks & shares ISA providers where a typical investor will take up his or her full £20,000 ISA allocation, investing in up to 5 funds over a twelve month period. Here are our top 3 brokers.

BrokerFeesCost per annum
Vanguard logoPlatform fee of 0.15%. Clients can choose from over 75 funds within Vanguard’s own range. Find out more >>£30.00
Cavendish logoPlatform fee of 0.25% for under £200,000 reducing to 0.2% on balance over £200,000+. Find out more >>£50.00
AJ Bell logo0.25% platform fee plus an additional £1.50 transaction fee per transaction. Clients have access to 2,000 funds, AJ Bell’s picks or four ready-made portfolio’s. Find out more >>£57.50

Data correct as of 18th February 2020

Investors should note that our research covers platform fees only. Individual fund manager fees for each fund held are likely to be variable depending on your broker. It may pay to decide on your choice of funds beforehand and calculate all fees prior to opening an account.

Investing in Stocks

We have applied a scenario across our 30 featured stocks & shares ISA providers where a typical infrequent UK equities investor will take up his or her full £20,000 ISA allocation, trading up to 10 times over a twelve month period. Here are our top 3 brokers.

BrokerFeesCost per annum
Ig Group logo£8.00 on all UK stocks, plus a platform fee of £24.00 per quarter which can be offset with three trades over the period. Find out more >>£96.00
Saxo logoTrade from £8 on UK stocks, plus a custody fee of 0.12% per annum charged on accounts with open positions (min monthly fee of EUR 5). Find out more >>£104.00
Barclays logo£6.00 with an additional 0.1% platform fee per annum. Find out more >>£108.00

Data correct as of 18th February 2020.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Michael Morton

Michael Morton

Michael has worked within the Financial Industry for more than 20 years. Starting out as a financial analyst, he has extensive experience working with fund management groups and brokerages.

With an interest in Stocks and Shares, Funds, ETFs and Commodities, his investment focus is medium to long term gains, with the objective of financial security on retirement, and building wealth for his young children for their adult life. His broker of choice is Hargreaves Lansdown.

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