Freetrade SIPP Review [Charges Compared]

by | Feb 19, 2024 | SIPP Reviews

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In this Freetrade SIPP review, we explore the details of Freetrade’s SIPP account, including fees, features, and a comparison with other options available in the market.

The Freetrade SIPP is part of a commission-free investing platform founded in 2016, offering free trading of stocks and ETFs.

Regulated by the FCA in the UK, the platform ensures the safety of your assets through a third-party custodian called DriveWealth.

And as a member of the FSCS, Freetrade provides asset protection up to £85,000.

Key Takeaways:

  • Freetrade is a commission-free investing platform that allows free trading of stocks and ETFs.
  • The platform is regulated by the FCA and uses a third-party custodian to hold customers’ assets in segregated accounts.
  • Membership with the FSCS provides protection for assets up to £85,000.
  • Freetrade offers a SIPP account, allowing investors to have greater control over their pension investments.
  • Depositing and withdrawing funds can be done via bank transfer or debit card, with no withdrawal fees.

About the Freetrade SIPP

Let’s start by understanding what Freetrade is and how their SIPP account can benefit UK investors.

Freetrade is a commission-free investing platform that was founded in 2016. It offers free trading of stocks and ETFs and is regulated by the Financial Conduct Authority (FCA) in the UK. This means that Freetrade operates within strict guidelines to ensure the safety and security of investors’ funds.

Freetrade’s SIPP account, which stands for Self-Invested Personal Pension, provides UK investors with a greater level of control over their pension investments.

With a SIPP account, investors can choose from a wide range of investment options, including stocks, ETFs, and investment trusts, to build a diversified portfolio that aligns with their retirement goals.

This flexibility allows investors to take charge of their pension savings and make informed decisions based on their individual investment preferences and risk tolerance.

One of the key benefits of Freetrade’s SIPP account is the ability to access over 6,000 UK and US stocks, as well as ETFs and investment trusts.

This extensive selection of investment options provides investors with ample choices to design a portfolio that suits their investment strategy.

Additionally, Freetrade offers fractional shares, allowing investors to purchase even a small portion of a share for as little as £2.

This feature enables investors to invest in high-priced stocks without having to buy a whole share, making investing more accessible to a wider range of individuals.

Freetrade SIPP Benefits
Commission-free trading of stocks and ETFs
Wide range of investment options
Access to over 6,000 UK and US stocks, as well as ETFs and investment trusts
Ability to purchase fractional shares for as little as £2
Greater control over pension investments

Opening an Account and Fund Deposits

To get started with Freetrade’s SIPP, you’ll need to download the app, enter your personal details, and link your bank account.

Freetrade offers a seamless process for transferring funds, allowing you to start investing in your SIPP account quickly. Whether you prefer to deposit funds via bank transfer or debit card, there are no fees for withdrawals. This flexibility makes it convenient for investors to manage their financial transactions.

Features of Freetrade’s SIPP Account

One notable feature is the access to over 6,000 UK and US stocks, as well as ETFs and investment trusts. This extensive selection allows you to diversify your portfolio and make informed investment decisions.

FeatureDescription
Fractional SharesThis means you can invest in high-priced stocks without needing to buy a whole share, making it more accessible for investors with smaller budgets.
Tiered Fee StructureFreetrade offers a tiered fee structure for its SIPP account. There is a free Basic Plan that provides access to basic features, a Standard Plan for £4.99 per month with additional benefits, and a Plus Plan for £9.99 per month with premium features.
Educational ResourcesFreetrade provides educational resources through its Invest Hub and blog. These resources cover a wide range of topics, from beginner investment strategies to in-depth market analysis.

Freetrade’s SIPP account also offers the option to open a Stock and Shares ISA account for tax-free investing and a General Investment Account for trading stocks and ETFs. This allows you to choose the account type that best suits your investment goals and tax planning.

Fee Structure

It’s important to understand the fee structure of Freetrade’s SIPP account and the investment options it offers. Let’s dive into the details and discuss the performance as well.

When it comes to fees, Freetrade offers three different plans: Basic, Standard, and Plus. The Basic Plan is free, while the Standard Plan costs £4.99 per month, and the Plus Plan is priced at £9.99 per month. Each plan has its own set of features and benefits, allowing investors to choose the one that suits their needs.

To help you better understand the fee structure and investment options, here is a table summarising the different plans and their associated fees:

PlanMonthly FeeFeatures
BasicFreeCommission-free trading on UK stocks and ETFs
Standard£4.99Commission-free trading on UK and US stocks and ETFs, limit orders, ISA account
Plus£9.99Commission-free trading on UK and US stocks and ETFs, limit orders, ISA and SIPP accounts, instant deposits

By considering your investment preferences, risk appetite, and trading frequency, you can choose the plan that aligns with your needs.

Asset Protection and Customer Support

When it comes to protecting your investments, Freetrade takes several precautions. The platform uses a third-party custodian, DriveWealth, to hold customers’ assets in segregated accounts. This means that your investments are safely held separate from Freetrade’s own assets.

In addition, Freetrade is a member of the Financial Services Compensation Scheme (FSCS), providing protection for your assets up to £85,000. The FSCS is an independent compensation fund that can step in if a financial firm fails, ensuring that your investments are safeguarded.

Asset Protection Measures:

MeasureDescription
Third-Party CustodianDriveWealth holds customers’ assets in segregated accounts.
FSCS MembershipFreetrade is a member of the FSCS, providing protection for assets up to £85,000.

When it comes to customer support, Freetrade offers multiple options to assist you.

If you have any questions or need help with your account, you can reach out to their customer support team through live chat or email.

The live chat feature allows for real-time communication, ensuring a prompt response to your queries. Alternatively, you can send an email and expect a timely and helpful reply.

Customer Support Options:

  • Live chat: Real-time assistance with prompt responses.
  • Email: Send an email for timely and helpful replies.

Educational Resources and Additional Accounts

Freetrade goes beyond trading by providing educational resources to help you make informed investment decisions. Let’s take a closer look at the educational resources and additional accounts available.

Educational Resources

The platform offers a range of educational resources through its Invest Hub and blog.

In the Invest Hub, you’ll find a wealth of articles, guides, and tutorials that cover various investment topics. From understanding different asset classes to learning about investment strategies, the Invest Hub covers it all. The articles are well-written and easy to understand, making them accessible to investors of all levels.

The blog is another valuable resource offered by Freetrade. Here, you’ll find market updates, analysis of popular stocks, and interviews with industry experts. The blog provides a fresh perspective on the latest trends and offers insights into potential investment opportunities.

Additional Accounts

In addition to its SIPP account, Freetrade offers two other types of accounts to suit different investment needs.

The Stock and Shares ISA account is perfect for those looking to invest tax-efficiently. With this account, you can invest up to £20,000 per year and any returns you make are completely tax-free. It’s a great option for long-term investors who want to maximize their gains and minimize their tax liabilities.

Freetrade also offers a General Investment Account, which allows you to trade stocks and ETFs without any tax advantages. This account is ideal for investors who want the flexibility to buy and sell investments without any restrictions.

Having multiple account options gives you the flexibility to choose the one that best aligns with your investment goals and preferences.

Account TypeTax AdvantagesInvestment Flexibility
SIPPPension tax reliefControl over pension investments
Stocks and Shares ISATax-free investingLong-term investing
General Investment AccountNo tax advantagesFlexible buying and selling

Conclusion: Is Freetrade SIPP Right for You?

One of the main benefits of Freetrade’s SIPP account is the greater control it offers over pension investments. With a SIPP, you have the flexibility to choose from a wide range of investment options, and you can make contributions from your salary or personal savings.

Overall, Freetrade is a popular and affordable trading platform, especially for beginner investors. With its user-friendly app, educational resources through the Invest Hub and blog, and accessible customer support, it provides a supportive environment for those looking to start their investment journey.

Ultimately, the decision to use Freetrade’s SIPP account will depend on your individual investment goals, risk tolerance, and preferences. We recommend taking the time to carefully evaluate your options and consider seeking advice from a financial professional before making any investment decisions.

FAQ

Q: What is Freetrade?

A: Freetrade is a commission-free investing platform founded in 2016 that offers free trading of stocks and ETFs. It is regulated by the FCA in the UK.

Q: How is Freetrade’s SIPP account regulated?

A: Freetrade’s SIPP account is regulated by the FCA in the UK.

Q: Who holds customers’ assets in Freetrade’s SIPP account?

A: Freetrade uses a third-party custodian called DriveWealth to hold customers’ assets in segregated accounts.

Q: Is Freetrade a member of the FSCS?

A: Yes, Freetrade is a member of the FSCS, which provides protection for assets up to £85,000.

Q: How do I open a Freetrade SIPP account?

A: To open a Freetrade SIPP account, you need to download the app, enter your personal details, and link your bank account.

Q: What types of accounts does Freetrade offer?

A: Freetrade offers a Stock and Shares ISA account for tax-free investing, a SIPP account for greater control over pension investments, and a General Investment Account for trading stocks and ETFs.

Q: How can I deposit and withdraw funds from my Freetrade SIPP account?

A: You can deposit and withdraw funds from your Freetrade SIPP account through bank transfer or debit card, with no fees for withdrawals.

Q: What are the fees for using Freetrade’s SIPP account?

A: Freetrade has a tiered fee structure for its SIPP account, with a free Basic Plan, a Standard Plan for £4.99 per month, and a Plus Plan for £9.99 per month.

Q: What investment options are available on Freetrade’s SIPP account?

A: Freetrade’s SIPP account provides access to over 6,000 UK and US stocks, as well as ETFs and investment trusts. Fractional shares can be purchased for as little as £2.

Q: Does Freetrade offer educational resources?

A: Yes, Freetrade offers educational resources through its Invest Hub and blog.

Q: How can I contact Freetrade for customer support?

A: Customer support is available via live chat and email.

About The Author

Sam Hodgson

Sam Hodgson

Head of Digital

Sam is our Head of Digital, overseeing all of our editorial and marketing strategies.

He has over a decade of pension industry experience, previously working & writing for the likes of HSBC and Hargreaves Lansdown.

His goal is to empower “non-financey” people to have confidence in making their own financial decisions, particularly on pensions and retirement planning.

Contact: sam@sippadvice.co.uk

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