Hargreaves Lansdown Fee Changes: Essential Guide to New Investing Costs

Hargreaves Lansdown Fee Changes: What UK Investors Need to Know

Hargreaves Lansdown fee changes have triggered one of the most important updates to the UK’s biggest DIY investing platform in over a decade, reshaping charging structures for millions of retail investors. These adjustments, coming into force from March, affect account and trading fees, reflect evolving client behaviour, and respond to heightened competition in the wealth management space.

Why Hargreaves Lansdown Fee Changes Matter

For long‑term savers and traders in the UK, understanding fee structures is crucial. Costs eat into returns, especially over time, and even seemingly small adjustments can have a meaningful impact on investment performance. Hargreaves Lansdown, a foundational platform for stocks and shares ISAs, SIPPs (self‑invested personal pensions), and other accounts, has been traditionally perceived as a premium option offering research tools and customer support that set it apart from cheaper rivals.

The recent Hargreaves Lansdown fee changes represent the first substantial overhaul since 2014, signalling a shift in strategy as the company aims to provide enhanced value while navigating competitive pressures from digital brokers and legacy firms alike.

Key Hargreaves Lansdown Fee Changes Explained

Lower Platform Charges

One of the biggest elements of the Hargreaves Lansdown fee changes is the reduction in the headline account charge:

• Platform fee for Stocks and Shares ISAs and SIPPs falls from 0.45% to 0.35%.

This reduction means that everyday investors holding balanced portfolios in these accounts will pay less over time to maintain their investments especially important for long‑term savers.

Cheaper Share Trading Fees

The cost to buy or sell shares online has also been reduced significantly:

• Share dealing fees drop from £11.95 to £6.95 per trade.

For those who trade shares intermittently or manage their own portfolios without advice, this change can reduce frictional costs and encourage more active investing.

Introduction of Fund Trading Fee

A notable new element in the Hargreaves Lansdown fee changes is the introduction of a £1.95 charge per fund trade—a departure from the previous model, where fund buying and selling was generally free.

However, trading via monthly automated investment plans or dividend reinvestment remains free, which may encourage more systematic investing habits among customers.

Custody Charge Cap Adjustments

Under the new structure, holding shares, investment trusts, ETFs or bonds now incurs an ongoing custody charge of 0.35%, capped at up to £150 per year for each account a change that expands the cap compared with previous limits.

Pension and Ready‑Made Solutions

Hargreaves Lansdown is also cutting charges on its Ready‑Made Pension Plan, reducing the account charge from 0.45% to 0.15% (with a separate fund cost of 0.30%). As a result, the overall charge on this product moves down to 0.45%, which can make it competitive with other pension solutions in the market.

Who Stands to Benefit Most

The platform’s own analysis suggests that roughly:

• 80% of clients will either pay the same or see lower overall costs.
• Around 50% of clients will be noticeably better off.
• 94% will either pay less, the same, or see a minimal increase (under £5 per month).

Investors with smaller to mid‑sized portfolios, particularly those focused on fund‑based strategies or ready‑made solutions, are likely to benefit the most from the fee cuts and trading cost reductions.

Potential Downsides to the New Fee Structure

While the headline fee cuts are welcome for many, the introduction of fund trading charges is controversial and could end up increasing costs for some investors—particularly those who frequently buy or sell funds outside automated plans.

Additionally, the increase in maximum account fees (e.g., custodial caps rising to £150) may mean that larger portfolios could see higher absolute charges than before, depending on the mix of assets held.

What the Changes Mean for the UK Investment Landscape

The Hargreaves Lansdown fee changes arrive amid strong competition in the UK investing market, with digital platforms and banks expanding their DIY investment offerings. Traditionally, Hargreaves Lansdown’s slightly higher fee structure was justified by customer service, research tools, and a broad investment range. However, rising competition has pressured legacy platforms to rethink pricing.

Some analysts suggest these fee changes might spur a price‑war effect, forcing other platforms to adjust their own charges to maintain market share.

Tips for Investors Navigating the New Fee Structure

• Review your portfolio mix: Look at how frequently you trade funds versus shares, as fund dealing fees could add up if you trade outside automated plans.
• Compare alternative platforms: Online brokerages and flat‑fee platforms may now offer competitive options, especially for active traders or ETF‑focused investors.
• Consider systematic investing: Monthly automated investments remain free for trading, making them cost‑efficient for long‑term plans.
• Use fee calculators: Check your expected costs with the new structure to understand the impact.

Helpful Resources

• Hargreaves Lansdown official fee update page: https://www.hl.co.uk/help/income-and-fees/fees-explained/fee-changes
• FT coverage of Hargreaves Lansdown fee overhaul: https://www.ft.com/content/60ddd296-6be8-4222-b31e-5873ba4c322b
• Boring Money analysis of fee changes: https://www.boringmoney.co.uk/learn/articles/has-hargreaves-lansdown-cut-its-fees/

Conclusion

The Hargreaves Lansdown fee changes represent a strategic shift for the UK’s largest DIY investment platform, designed to reduce costs for many clients while introducing new charges that reflect evolving investing behaviours. For most investors, the changes mean lower platform fees and cheaper share trading, but the new fund trading fee and custody cap adjustments make it important to evaluate how your specific holdings and trading style will be affected. With competition intensifying across the investment platform landscape, staying informed about fee structures is more important than ever.

Related Articale