I have £15,000 - £20,000 to invest for the long term and I've researched what I will regularly invest in to: Pension, Index funds, Bonds, small number of individual stocks (maybe) as well as my cash ISA.

I'm already using the cash ISA but I'm confused as to where the other services are offered... Is there a service that offers all of these accounts? I've been looking through online UK brokers and the fees seem very high if I'm only investing £200 per month...

Should these services provide the option to buy index funds as well as normal stocks and bonds? I am assuming I will arrange a personal pension through somewhere else.

Thanks for your advice

  • Hi Henry. Can you clarify what you mean by "only investing £200 per month". Youre not investing all 20,000 at once? Brokers usually charge a fixed amount per transaction, so yes if you only buying £200 of stocks per month its not too efficient. Those that dont charge a fixed amount usually expect you to trade with high volumes, and they charge per share. Finally, the vast majority of brokerages will allow you to invest in index funds, bonds, and individual stocks. Cant comment on ISA
    – von Mises
    Nov 21, 2014 at 5:54
  • Hey thanks for the reply. I'd like to invest £15,000 at once (keeping £5,000 emergency) and then build the investment over time with a percentage of my monthly income. All of the books I've been reading have recommended this but the fees seem so high... Most were recommending mutual funds or index funds because they have lower fees (apparently). I guess I'm stuck because I don't actually know the best 'way in' or the best way to invest without losing to high fees or being tied in.
    – Henry
    Nov 21, 2014 at 6:16
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    I've gone right off the Motley Fool, but their Investing Basics guides are still a good introduction, filtering out their incessant mentions of their own dealing service as necessary...
    – AakashM
    Nov 21, 2014 at 10:10
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    UK brokers and the fees seem very high if I'm only investing £200 per month Yes they are high. Why don't you shop around ? moneysupermarket.com/shares the-international-investor.com/comparison-tables/… money.co.uk/share-dealing.htm
    – DumbCoder
    Nov 21, 2014 at 10:34

4 Answers 4


My solution, since I was only interested in mutual funds, was to bypass brokers entirely and open an account directly with the firm which runs the funds I was interested in, and directly purchase and redeem shares of no-load funds through them. No transaction fee, no broker fee, pretty easy access via mail and/or network...

I can't trade in individual stocks/bonds, or derivitives, though this channel. It does tend to push me toward buying funds from that single family, since it's easier to move money between them than to pull it out and put it back into another company's funds. And I don't have a broker advising me.

Then again, there's the question of how much you want to trust a broker's advice (given that they're motivated to make the most profit for themselves which may not be what's best for you), and I honestly don't feel a need to play with anything more complicated than a fairly standard balanced mix of index funds, and the fund family I chose has so far had a fairly high-rated fund to offer me in whichever category I've looked at -- not always the highest, but good enough for my purposes.

This may not be the right answer for everyone, but it's been pretty painless for me. And "painless" is among my top priorities -- I find no pleasure in pushing numbers around, I don't suffer from the fantasy that I'm going to out-think the pros, I want the investments to work for me (with minimal supervision) rather than my having to make an effort to maintain them.

  • That wont work in the UK its cheaper to go though a broker for Unit trusts and ICE's rather than direct unless your investing in some Investment trusts
    – Pepone
    Jan 1, 2015 at 22:41
  • Pepone: This may depend on what you're investing in. Many mutual funds offer multiple classes of shares with different kinds of fee structures, and not all of those may be available through all channels. I certainly don't know your market, but I strongly suspect that there are low-fee funds available to you which do not require going through a broker. They may not be the specific funds you're interested in, but in principle index funds tracking the same index should have roughly similar performance.
    – keshlam
    Jan 1, 2015 at 22:51
  • @kesham not in the uk fund supermarkets are cheaper fund houses don't want to deal with retail customers
    – Pepone
    Jan 1, 2015 at 23:00
  • I'll take your word for it. Here, many (not all) of them find that supporting direct transactions brings them customers that brokers wouldn't, and the cost of handling direct customers isn't that much higher (especially now that everything's being done electronically and all it takes is a different "front-end" on the system, which is a very minor cost).
    – keshlam
    Jan 1, 2015 at 23:02

From experience (i have just invested around 15k in this manner) I would suggest investing in some of the large general investment trusts as they tend to have lower fees and better performance.

Most IT houses run in house low cost saving schemes for regular monthly investors.

Id suggest Lowland, City of London, Bankers, and the Granddaddy of the all F&C - though F&C's saving scheme isn't that good for smaller amounts.

Note that some of the above companies have increased their dividends every year for the past 3 or 4 decades.

If you are a higher rate tax payer do this inside a self select ISA ie don't use all you ISA allowance in cash.

Also if your employer offers a share save max this out if you can afford it - last years BT one returned almost 100k tax free if you had the max amount.


For many investments, including ISAs and pensions, it's possible to go straight to the fund managers and cut out the middle-man.

The yearly fees on each fund will be higher as a retail invester, but you can offset against that not having to pay anything to the broker. Many ISAs (and pensions) will accept monthly payments.


Perhaps try a company like Hargreaves Lansdown. They have share accounts, SIPPs, ISAs etc. Like many online brokers they discount the initial fee on funds/unit trusts so you avoid the 5% dealing fees that fund managers charge if you go direct.

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