Savers pull millions from Hargreaves Lansdown despite fee shake-up

Should you follow the wave of investors who are voting with their feet and switching platforms from Hargreaves Lansdown to rival platforms?

Hargreaves Lansdown has long been thought of as a costly option, or “premium”. However, investors are starting to recognise the long-term impact of fees on their investment returns and in response, HL has finally announced a major change to its pricing, including a cut to its headline platform fee from 045% to 035% from March 2026.

Platform fees are one of the few costs that investors can control and should be considered carefully. While small percentage points may feel insignificant, they can have a dramatic impact over time. However, investors should also be aware that the most cost-effective solution will often depend on their pot size.

Broadly speaking, platforms charge their customers one of two ways. Percentage-based fees, which are the most common method, and flat monthly subscription fees. It therefore stands to reason that those with a small pot will benefit from a low percentage fee. However, a move to a flat fee could prove more prudent for pots that have grown in size.

At what point you choose to move in order to save money on fees will largely depend on your platform. A vague rule of thumb would be to consider your options when your investment pot reaches around £50,000.

So how much can you actually save by moving platforms? I’ve done some rudimentary maths for you below, but I’d like to stress that whilst these figures may not appear life-changing, the opportunity cost can be significant. What would that money have offered you if it had remained in your account, quietly compounding for decades?

In order to compare apples to apples, I’ve focused my examples on the ongoing platform fee for a buy-and-hold investor holding funds, using HL’s new 0.35% platform fee. Trading costs and fund charges can change these results, and are a consideration at a platform like HL.

If you have £25,000 invested

• HL at 0.35%: about £87.50/year
• AJ Bell at 0.25%: about £62.50/year
• ii Core plan: £5.99/month = £71.88/year

Potential saving vs HL:

• AJ Bell: about £25/year
• ii: about £15.62/year

If you have £75,000 invested

• HL at 0.35%: about £262.50/year
• AJ Bell at 0.25%: about £187.50/year
• ii Core plan: £71.88/year

Potential saving vs HL:

• AJ Bell: about £75/year
• ii: about £190.62/year

If you have £150,000 invested

• HL at 0.35%: about £525/year
• AJ Bell at 0.25%: about £375/year
• ii Plus plan (portfolio over £100k): £14.99/month = £179.88/year

Potential saving vs HL:

• AJ Bell: about £150/year
• ii: about £345.12/year

Ready to switch? Here’s what you should check first

• Check what you are actually holding and whether that option is available at the platform you intend to switch to.
• How often are you trading? Trading costs are higher if you trade frequently, and could be a further consideration.
• Should you transfer “in specie”, a fancy way of saying you can switch without selling your assets first, in order to limit disruption to your investments.
• Are there any cashback offers? Switching incentives are plentiful and can be a nice bonus for your pot.

If you are looking for your perfect stocks and shares ISA, you may want to head to our quiz, which will effortlessly match you with your perfect ISA in seconds. Fees, whilst important, are not the only factor to consider.