If you’re currently on the lookout for an ISA, you might be thinking along the lines of Barclays, Nationwide, or Halifax. In other words, the vast majority of ISA providers in the UK typically come in the form of a bank or building society. The overarching reason for this is that such financial institutions are usually protected under the FSCS, meaning that your funds are 100% safe.
However, it is also worth considering what non-conventional institutions such as Hargreaves Lansdown have to offer. The hallmark online brokerage firm now offers three individual ISAs for you to consider.
If that sounds like something you would like to explore further, be sure to read our in-depth Hargreaves Lansdown Review. We’ve covered all of the ins and outs so that you can make an informed decision as to whether or not the ISA provider is right for you!
Hargreaves Lansdown ISAs: What ISAs are offered?
Hargreaves Lansdown is an online brokerage platform and thus – falls under the remit of an investment firm. This means that unlike a traditional bank or building society – you won’t be able to obtain a simple Cash ISA. If this is something that you’re after then you will need to look elsewhere. Nevertheless, we have broken the three main ISA products offered by Hargreaves Lansdown below.
Is Hargreaves Lansdown Safe?
Hargreaves Lansdown is often regarded as the hallmark online stocks and shares platform in the UK. The broker offers thousands of stocks and shares, as well as other financial assets such as bonds, funds, and of course – ISAs. Although the online broker is not a bank or building society, it is still protected under the Financial Services Compensation Scheme (FSCS).
However, it is important to note that the rules surrounding an investment firm like Hargreaves Lansdown are different from that of banks and building societies. While the latter will protect your cash deposits up to the first £85,000, investment firms are limited to just £50,000. This shouldn’t be a problem unless you are thinking about investing more than£50,000.
How do Stocks and Shares ISAs work at Hargreaves Lansdown?
The vast majority of UK savers will opt for a stand-alone Cash ISA. While the interest rates available are super low, they are popular because of their guaranteed income, as well as their tax-efficient savings. Moreover, there is no requirement to do anything other than sit and watch your money grow. In the case of ISAs at Hargreaves Lansdown – whether that’s in the form of a Stocks and Shares ISA, Junior ISA, or Lifetime ISA – there is no guarantee that you will make any money.
While it is true that a Lifetime ISA does come with a 25% government contribution – in theory, you could still end up with less than what you started with. This is because you are simply using Hargreaves Lansdown as your proprietary stock broker. You will purchase all of your shares via the platform – with the first £20,000 being shielded from tax.
As you may well know, the value of stocks and shares can go up and down. Therefore, just make sure that you understand the risks. If you do proceed with a Stocks and Shares ISA via Hargreaves Lansdown, you are best advised to hold on to your portfolio long-term. That way, you stand the best chance possible of riding out market volatility.
Does Hargreaves Lansdown offer a Cash ISA?
Hargreaves Lansdown does not, and cannot offer a traditional Cash ISA. Instead, all of its ISA products centre around the stocks and shares space. Notably, this includes a Stocks and Shares ISA, Junior ISA, and a Lifetime ISA.
Is a Hargreaves Lansdown Lifetime ISA safe?
Your money is 100% safe at Hargreaves Lansdown. However, as an investment firm, your funds will only be protected up to the first £50,000. Moreover, the FSCS protection will not cover you in the event that your stocks and shares go down in value, so do bear this in mind!
How much can I put into a Hargreaves Junior ISA?
As per the 2019/20 limits, you can invest up to £4,368 per year into your Junior ISA at Hargreaves Lansdown. This amounts to a monthly contribution of about £386 if you wanted to keep things consistent. The annual allowance is reviewed each year by the UK government, so this could go up in the very near future.
Does Hargreaves Lansdown charge any fees on its ISAs?
Unfortunately, yes. In fact, regardless of which ISA you decide to open at Hargreaves Lansdown, you will need to pay an annual fee of 0.45%.