Hargreaves Lansdown will no longer offer independent advice so it can focus its research and simplify its fee structure.
The Bristol-based company has moved to become restricted so it will not be obliged to research investments clients rarely hold, or which its analysts believe are overly complicated, opaque, expensive or carry excessive investor risk.
Subject to a minimum fee of £495, Hargreaves will now advise clients over the telephone regardless of the size of their portfolio.
It has also simplified and capped its advisory fee tariff so investment advice will cost 1 per cent for the first £1m, with the excess carrying no charge.
Hargreaves Lansdown head of communications Danny Cox said: “This change will set the groundwork for us to simplify and reduce our advisory charges, develop our telephone-based service and increase the use of technology to improve the efficiency of the advice process.
“In reality investors will see very little change in what we advise over. We shall continue to offer the same broad range of investment advice, including portfolio management, investment and pension advice, retirement planning and inheritance tax mitigation as we do now.”
|Charging structure changes|
The firm said it has also simplified the charge for its range of annual review services, which was previously 0.365-0.5 per cent per cent, depending on the type of service selected.
It is now is 0.365 per cent for the first £1m, and 0 per cent on the excess.
Hargreaves Lansdown Asset Management is also simplifying the charges for the portfolio management service with the removal of the yearly 0.75 per cent + VAT discretionary charge that applies when third-party funds are used.
The HL Vantage service and charges remain the same.
Bob Wilson, director of Norwich-based GreenSky Wealth, said: “If you are independent you do not have to spend a lot of time researching obscure funds, but you do have to be aware of what is happening in the whole market.
“I am expecting more advisers to ditch the independent tag because people will understand more about what restricted means.”