Part 3/7:
Understanding Impact on Investors
Under the new fee structure, small investors find themselves at a disadvantage. For example, an investor holding only £1,000 would face an annual fee of £48 — a staggering 4.8% of their investment, compared to just £15 under the previous model. Investors with £10,000 would see their annual costs rise more than threefold to £48, a notable turn for those who started with smaller investments.
This shift in fee structure renders Vanguard a less attractive option for those with modest investment amounts, particularly when juxtaposed against platforms that do not impose minimum fees for lower balance accounts.