- Avoid the high-street banks: As mentioned, banks are typically limited in their investment choices available. Additionally, some banks and building societies partner with third party providers to offer their service which results in higher administration charges than usual.
- Understand all charges: Be clear on the charges imposed by a stocks & shares ISA provider. Some may offer no yearly administration fee but their dealing charges may be higher than those that charge a yearly administration fee – this will significantly outweigh the no administration fee if an investor trades frequently. Therefore, it is important to understand the stocks & shares ISA charges from an investor’s context.
- Interest rates: It seems fairly inevitable that at times, a stocks & shares ISA will have cash held within it. Some stocks & shares ISA providers have begun to increase their interest rates offered – some currently do not offer any interest on cash held.
- Service: Try to understand the level of service and support that will be provided. An investor may like the idea of having a comprehensive mobile app or a customer service team that is quick to deal with queries – and as such may be willing to pay a little more in charges for this.
Searching for the best stocks & shares ISA can be complex depending on whether the investor has a large pot to invest and whether they will be trading a lot. The key is for an investor to combine their understanding of all main charges that will affect their stocks & shares ISA usage pattern in accordance with the aforementioned points above.
Remember, the stocks & shares ISA limit for 2016/2017 is £15,240 per year.