There has never been such a massive influx of retail investors into the stock market as in the last year.
As the financial year draws to a close, more people are navigating the increasing number of platforms in order to find the best ISA to make use of their annual allowance before the deadline hits. The amount of choice is crippling and the platform that is best for one person, may not be suited for another. Cost, user experience, customer service and investments on offer are all considerations to factor in.
So how do you go about selecting the ISA platform that’s best for you?
Top Investment Platforms for ISAs
Stock Market Knowledge
How much experience and knowledge you have of the stock market is one of the major factors when selecting your provider. Are you going to take an active role in selecting and managing your individual investments, building a diversified portfolio and carefully adjusting your investments in line with fluctuations in the stock market?
Or would you prefer to open your ISA and deposit your money into a pre-made portfolio that has been matched to your appetite for risk? Without the relevant knowledge and experience, we wouldn’t recommend that you attempt to go it alone unless you are investing with a sum of money that you are happy to lose.
Mitigating your risk takes a certain level of experience, and thousands of investors have already been stung following the crowd on social platforms.
Ensuring you are getting value for money very much depends on the size of your investment pot, as well as how many trades you intend to do. Small investment pots will often benefit from a percentage fee structure, whereas larger pots may be better off with a flat fee.
Beware of making your selection based on fees alone, as often low cost does not represent the best possible service. The good news for small investors is that there are platforms that will waive the fees completely for investment pots that are less than £1,000 in value.
Wombat offers this option, and you could always transfer your investments to another provider should you grow your wealth beyond that point.
DIY investors should be cautious of trading fees as these can vary significantly from one platform to another, and depending on the number of trades you intend to do each month, this is a cost that can soon add up and start eating away at your potential gains. There are platforms such as Interactive Investor who will allow one free trade per month as part of their monthly platform fee of £9.99, representing excellent value. Other platforms offer zero commission trading, such as Freetrade, which is an even better option for frequent traders.
Investments On Offer
For DIY investors it’s important that you know the investment platform you are considering can provide you with the type of investments you would like to buy and sell. Stocks, shares, funds, ETFs, investment trusts, and bonds are all available, but not on every platform. Make sure you check what’s on offer and ensure the suite of investments can meet your needs.
Level of Assistance
Different platforms will have varying levels of assistance when it comes to navigating the stock market. Traditionally investing was done with the help of a financial adviser, and whilst this is rare to find on a platform, there are various tools and calculators that can help you along the way.
One platform that can provide access to a Financial Adviser is Nutmeg who can offer an in-depth review of your finances in order to help you plan for your retirement, invest wisely and quantify your financial goals. Of course, not everyone requires this level of assistance and this kind of service often attracts an additional fee so ensure you have all the information before making any commitments.
Most platforms will provide users with an app so they can manage their investments on the move. However, if this is the level of service you require then it would be best to check they have an app, and that the app is meeting all your expectations. Investment apps should be user friendly and easy to navigate with clear, modern designs. Most apps will provide biometric security measures such as face ID and touch ID and allow you to deposit and withdraw from within the app.
Level of Service
Whilst all platforms will provide customer service, the level of service can vary dramatically between providers. You should ask yourself what time of day you are most likely to be trading or checking your investments. If you are a night owl then you might want to find a provider that has 24 customer support. You may also want to consider how you like to receive support, be it via live chat, phone, or email.
Many platforms now have agents available through the app which represents great convenience. It is prudent to have a quick look at their Trustpilot reviews in order to ascertain response times and levels of service.
The features offered between platforms vary significantly, and it’s important to understand the features that will be a positive influence on your unique investment journey before you commit to any one platform. Would you benefit from a rounding-up feature that can round up all your expenditure to the nearest pound to add to your investments? Or perhaps you would be better served with a Shariah-compliant portfolio?
For a detailed guide on the different ISAs available, you can refer to our article on How to Start an ISA.
Check our guide on Best Stocks and Shares ISA for detailed information on the best Stocks and Shares ISA providers so you can make an informed decision. Always remember that you can open several ISAs, however, you can only pay into one ISA in any one tax year.