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Ever wondered how much you might end up losing by not shopping around for the best deal on a Stocks and Shares ISA?
Small-seeming fees and costs on an ISA really can add up over time. But many investors believe that if their ISA does well enough, such fees will more or less come out in the wash.
In reality, even if you make brilliant returns on your investments, it still makes sense to give as little of them away as possible in fees and commissions.
Small differences can mean contrasting outcomes
To illustrate, imagine a Stocks and Shares ISA worth £20k.
This table contrasts the cumulative impact of an annual fee on that ISA, one of 0.5% and the other 1%, but wth none of the other gains we might expect.
| Year | ISA value (with 0.5% fee) | ISA value (with 1% fee) |
| 10 | £19,022 | £18,088 |
| 20 | £18,092 | £16,358 |
| 30 | £17,207 | £14,794 |
| 40 | £16,366 | £13,379 |
Now, there are a couple of interesting things about this table.
First, over the decades that 1% fee leads to the ISA being worth thousands of pounds less than with a 0.5% fee.
Remember, this is on a £20k Stocks and Shares ISA and the negative impact is already dramatic. Imagine how much more money would be taken, even at the same rate, if this was a much bigger ISA.
Secondly, notice that even in the ISA with an annual fee of 0.5%, the first decade alone sees close to £1,000 in fees being charged.
0.5% may sound so small it is almost negligible. The table clearly shows that is not the case!
Making the most of your money
Bear in mind that in that example, I am only talking about fees. An example might be the annual management fee.
On top of that, there can be commissions when you buy or sell and other costs like stamp duty.
The message is clear. Even small-seeming differences in fees and other costs can add up to thousands of pounds.
So it definitely makes sense to choose carefully when comparing different Stocks and Shares ISAs!
What you do with it also matters
So far I have focused on fees.
Of course, the key long-term driver of returns in a Stocks and Shares ISA is likely to be how you invest it.
So, let us look at the same table above, assuming the ISA achieves a 5% compound annual gain before fees.
| Year | ISA value (with 0.5% fee) | ISA value (with 1% fee) |
| 10 | £31,059 | £29,605 |
| 20 | £48.234 | £43,822 |
| 30 | £74,906 | £64,868 |
| 40 | £116,327 | £96,020 |
On the hunt for shares!
One share I think is worth considering right now is S4 Capital (LSE: SFOR).
The digital ad agency group spectacularly lost favour with the City over the past few years. From over £8 back in 2021, the S4 Capital share price went below 20p earlier this year.
But it has bounced back in spectacular fashion and now stands 160% above where it started 2026.
Interim results were moved forward to this week — and were brimming with positive news.
An operating loss of £11m last time around gave way to an operating profit of £5m this time. Net debt was more than halved and S4 declared an inaugural interim dividend of 1.3p per share.
But revenues fell and I see a risk that tech companies focussing spend on AI over marketing could lead to ongoing revenue weakness.
Still, S4 Capital’s sharply improving financial position means I think its future looks bright.
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Christopher Ruane owns shares in S4 Capital.
This story originally appeared on Motley Fool
