Introducing annual subscriptions and pricing changes

Standard plan increases from 0.45 to 0.59 - so for $1000 trade it will cost you $1.40 more. Only you know how much you trade to appreciate whether the plus is more beneficial.

Regarding ibkr - it’s primarily US based and a bit convoluted - but feel free to open and share a review and comparison. I only opened it because I needed to move a position from a custodian and it could only done via US broker. They charged me $50 because I filled a form in incorrectly and I had to maintain a certain balance before they would even consider my transfer. But please form your own opinions.

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If you choose to pay monthly you won’t be stuck in a subscription.

You have the option of paying for 12 months upfront for a lower fee, but this isn’t compulsory.

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People saying FT increased it prices are kinda wrong as it has only got cheaper for many, the people who will make FT viable, and has just made the FREE option a bit more expensive. Although this option is still better than most and all in some metrics.

If the issue is purely cost then these people should be going with CMC and getting the free £50 as that would cover the costs for a long time on very small portfolios.

At the end of the day FT is like Ryanair or Easyjet, budget, and needs to make money somehow. Whatever they do will upset X, Y and Z but A through to W will still use it and be happy when comparing to other options out there.

FT are frustrating and seem to be going out of their way to implement the lesser wanted things and Introducing annual subscriptions and pricing changes - #281 by mig nailed it but are still the best option although that may not be the same long term unless they get back into comms and improve some things.

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Do we know how this will be taken. Will there be an option to pay up front via the app or will this be via direct debit?

If the new subscriptions don’t start til May then will the yearly price be paid over 11 months?? Seems strange not to align with the tax year!

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I’m a bit late to the party here, although in some ways deliberately so as I’ve had to consider my response. I don’t want to repeat already excellent points made by people here and the topic causes me considerable difficulty.

I feel a bit betrayed by this price increase, if I’m honest. It comes so soon after the last one which I defended to the hilt even at the cost of making enemies on this forum and this announcement makes me feel I’ve been taken for an absolute fool! And before anyone argues with me that it isn’t a price increase, it is when you don’t want to pay upfront. Paying upfront is an opportunity cost, because instead of paying more into your investments earlier and paying the monthly fee, you are having to pay £55 upfront that you otherwise hadn’t intended.

As anyone who has read my posts will know, I have no objection to paying increased fees as I’m fully aware of the need for FreeTrade to be solvent. I also was one of those who said that I would like to see an annual payment, but I had imagined that would be a discounted offer, such as £99 for one year of Plus or £50-55 for Standard and not, as has happened here that they set the annual payments to the current rate and jack up both the monthly costs and the FX fees.

Six months ago when the prices went up, I said that the service you received even for £5 per month was excellent value. At the time I would even have said £6 per month was great value. Unfortunately I’m not sure how true that is anymore. Even as a standard user, I’ve noticed a marked decline in customer service. I’ve become a bit disillusioned at their seeming unwillingness to address issues that are obviously losing them money, tax certificates and SIPP employer contributions are two that come up on the forum continually. The one that impacted me was the unacceptable 3-5 day delay in money withdrawal, had it not been for that, I would have become a Plus user 6 months ago. I do object to them raising prices to plug financial holes before they fix issues that are clearly deterring customers from transferring products to them.

However, not even any of the above would have mattered had this not given me the feeling that I might not be able to trust FreeTrade anymore. As others have mentioned, they have implemented this without explanation and so soon after the last increase. What’s more, they are selling it as an option to pay annually, when actually it is to bounce you into a different course of action by worsening the conditions of the monthly payment and Standard accounts. As well as it being what I find a dishonest sales pitch, I now have serious doubts about their solvency going forward, which obviously makes paying the annual fee a risk.

While I still think the FreeTrade product is great and I wish things were different, I feel it is time to go but struggle to think of any alternatives. Lightyear would have been my first choice but sadly no ISA and not enough of a stock universe. I am not at all keen on T212 but they looking like my best option both from an equivalence, price and solvency point of view. What I might do is open a GIA and test buy and sell small value shares, test money deposit, withdrawal, etc and see if they would be worth switching the ISA to in the new ISA year. While I know the solvency question may arise in the future, I think that’s potentially further off than it will be for FreeTrade.

If anyone wishes to respond to me here by suggesting that FreeTrade are better off without me and not to let the door hit my backside on the way out, you are of course entitled to your opinion, but you’d be very wrong to suppose that I’ve not been a supportive and fully paying customer of FreeTrade. I have happily paid the fees and supported them on this forum the last time they raised them. I have been very patient with their short-comings and have always made sure to be painfully aware that they are a start-up and that leniency is necessary. But there comes a point at which you have to consider whether a product and company is still the right one for you and, although I’m going to consider very carefully over the weekend, I sadly think I’ve had to face the conclusion that they aren’t.

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This is my main worry, and I am surprised that not many people seem to be thinking about it.

Freetrade is losing significant amounts of money. The year ending September 30 2021, was £18.2m.
There were rumours about talks about the potential sale, and it’s no secret that last Crowdcube raise, Freetrade raised less than they hoped.

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2 price rises in 6 months and they let 15% of the staff go. It does not look good. My question is if you pay the yearly subscribtion up front and they do go bust what happens to that money?

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I wouldn’t mind the increase if the customer service would get better, they take ages to get back and when they do all they ever seem to do is say oh this need to go to a different team and then you have to wait for them to get back.

They ask the questions in the app so it should automatically send it to the correct team rather than having to wait around all the time.

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Waiting to read the comments appearing on this article:

I must admit that as a new investor (I joined Freetrade in September last year) it would be much more reassuring if these types of messages were delivered in a way that didn’t leave doubts in our minds about the future stability of the business. As a standard subscriber I am now starting to research my options, not due to the changes themselves, but due to the way it has been communicated.

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Tbh i have the Sipp and isa. so if we could have a jisa and a working website i don’t think most of us would complain about this. i keep on seeing suggestions about employer contributions but how many companies actually support this as mine doesn’t

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If this was communicated to customers along with increase notification

chief executive Adam Dodds said the environment had changed.

‘When you spoke to us [in 2021], it was before we had revamped our plans. I don’t think the interest rate environment was the same as what it is now,’ he said.

'It seems pretty reasonable in today’s environment that you would see a bit of a increase in this plan.

'And then we give an option to our customers to maintain their current rate if they don’t mind paying upfront, because that gives us obviously more certainty as a business around the revenue so it’s a bit of a win-win that way.

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Another quick point… how many people just re-invest their dividends every month/quarter without a thought? Then look at how much it would cost you on a platform like HL or ii. My experience of ii suggests that instead of 5 or 6 re investments a month, I’d have to save them all up and do 1 to minimise the £7.99 per trade fee. If not, Feb would have cost me £31.96 in reinvestment costs on dividends of 56 quid in total on 4 div reinvests. So instead of putting 56 back I’d have reinvested less than half!

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Just to add some detail.

dividend reinvestment on ii and HL are lower cost, though not free (though should be noted that there is no automatic dividend reinvestment option with free trade :eyes: )

ii costs £0.99 and HL its £1 minimum or 1% of the transaction up to £10
In the case of ii I believe this can be taken out of your monthly ‘free trade’ money.

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A really good option that would reduce peoples anger would be FT satisfying loads by offering the fee being paid inside ISA or SIPP. Many will prefer this as it is a hidden charge. I hate subscriptions and know many others will, so taken out of your pot is much better and cleaner for a bank statement.

This would also be good for long term customers who may struggle every month to pay but get them in the system and they may end up being very loyal big customers in the years to come.

For me, I like the yearly option and will go down that road whilst at FT but there are soooo many people over the last year or so that are really stretched and this will feel worse than it maybe is. Going to paying inside the ISA/SIPP would be a great option and I believe hugely beneficial long term.

If it was an additional option they could still use the old metric to compare to other companies as that is a clever trick they use to make the return look even better with FT.

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For sure freetrade is still cheap where else are you getting a sipp and isa for this price. All we need is a bit more communication

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Has that changed recently? Because about 18 months ago when I switched here, it was costing me 7.99 a trade to reinvest dividends or my free monthly trade that came with the 9.99 subscription

Agreed. Show us the carrot! :carrot:

I think that employer contributions are probably more useful for the self-employed than the employed.

ps Welcome to the community

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dividend reinvestment is an automatic reinvestment option. if you’re manually reinvesting dividends then it’ll cost you the full price. the full details are here https://www.ii.co.uk/investing-with-ii/dividend-reinvestment

Exactly carnt think of one company that would do this

The automated options are by far the cheapest way to use HL. Commission on regular savings is pretty cheap as well. with the disadvantage being that you don’t control when the trade is made. I used to set up a regular savings option for the share I wanted to buy, and change it to something else the following month rather than doing manual trades