Custodian fees and trading costs are no longer being charged separately but are now baked into the monthly fee structure which now has 4 bands instead of the 3 bands they launched with:

https://www.nestwealth.com/for-individual-investors#close

Old Fee Structure:

$10k to under $75k: $20 per month
$75k to under $150k: $40 per month
$150k and higher: $80 per month

New Fee Structure:

$10k to under $75k: $25 per month
$75k to under $150k: $50 per month
$150k to under $325k: $100 per month
$325k and above: $150 per month

This is a notable change from the previous approach. Even if considering maximum trading costs of $100 per account and maximum custodian fees per account, the new approach’s higher fees more than absorb the trading and custodian fees and represent a net cost increase.

This changes the calculus for the break-point where Nest Wealth retains a cost advantage relative to providers that charge a percentage of Assets Under Management (AUM).

That breakpoint for an individual investor is now $450,000 as Nest’s new monthly fee of $150 nets out to the same 0.4% you would pay at Wealthsimple (150*12/450000 = 0.004).

That said, you also need to consider the impact of multiple investors in the household, each of whom has their own Client ID. All accounts for each Client ID are grouped together and the total AUM for that Client ID is used to calculate the applicable monthly fee which is charged to one investment account only.

Note that a Client ID is generated by individual accounts, joint accounts and corporate accounts. This means that, for example, a family of 4 with two adults and two children could have three Client IDs (one Client ID for each adult’s individual accounts and one Client ID for joint accounts held by both adults).

For example, in my situation I pay 3 monthly fees:
1. A monthly fee for the Client ID for my individual investments
2. A monthly fee for the Client ID for my spouse’s individual investments
3. A monthly fee for the Client ID for a joint account holding a Family RESP for our kids

Annualizing those monthly fees at the new rates and dividing that into the total portfolio in my case means that I will effectively pay 0.44% MER at Nest in July which means the cost advantage is no longer there relative to Wealthsimple (0.4% for portfolios over $100k).

Looking into the details will help you make an informed decision what makes sense for your circumstances and situation which may be different from what I have discussed here.

Keith,

It should be total, but you’ll want to double check with them.

DJ,

I don’t know how I missed that, thanks for catching that. I’ve updated the review to include those fees.