Vanguard vs Hargreaves Lansdown: what’s the difference?

Vanguard and Hargreaves Lansdown (HL) are two of the biggest investment platforms in the UK. 

But what exactly are the differences between them, and which one is better for your investing needs?  

This guide weighs up the main differences between Vanguard and HL to help you decide which platform to choose.

What is the difference between Vanguard and Hargreaves Lansdown?

The main difference between Vanguard and HL is their underlying investment philosophies.

Vanguard

Vanguard is dedicated to the principles of passive investing and keeping costs low. 

It focuses on index funds and exchange-traded funds (ETFs) that track market performance instead of trying to beat it.

Vanguard offers funds and ETFs that span many geographic areas, such as Europe, Japan, the US and the UK.

The ongoing charges vary depending on your choice of investment - ranging between 0.06% and 0.79%.

Included in Vanguard's funds are its LifeStrategy portfolios, with various options tailored to different levels of investment risk. For example, the LifeStrategy 80% Equity Fund invests 80% in shares and 20% in bonds, with a risk level of four out of seven. The ongoing charge is 0.2%.

Unlike other platforms, Vanguard only offers its own funds, including mutual funds and ETFs, so you won’t be able to invest in funds from other providers.

Hargreaves Lansdown

Meanwhile, Hargreaves Lansdown allows investors to access various investment products from multiple providers. They offer a wider range of investment options, including active and passive funds, individual shares, ETFs and investment trusts.

According to HL, there are over 1900 ETFs available via their platform, and you can access ready-made funds or choose your own.

You can decide on a portfolio based on whether you want to grow your money, receive an income or save for retirement.

Vanguard vs Hargreaves Lansdown: how do the fees compare? 

Investing fees can eat into your long-term returns, so it's important to understand the pricing models at Vanguard and HL. 

Vanguard fees

Vanguard focuses on having low fees.

Its new pricing structure, which was introduced in 2025, is simple: 

• On balances under £32,000 charges £4 a month (£48 a year).

• For balances over £32,000, Vanguard charges a 0.15% account fee (capped at £375 a year).

• Account fees are in addition to ongoing fund management fees which range between 0.06% and 0.79%.

• The account charges are the same whether you have a general trading account, stocks and shares ISA or pension.

• Costs are higher if you choose managed investments - the management charge is 0.2% in addition to the fund management cost (average 0.17%)

So, if you invested £20,000 into a Lifestrategy fund, you would pay:

• Account fee: £48 a year.

• Fund management fee (based on average charge of 0.2%): £40 a year.

• Total cost: £88 a year.

Alternatively, if you invested £50,000 into the same fund, you would pay:

• Account fee: £75.

• Fund management fee (based on average charge of 0.2%): £100.

• Total cost: £175.

Hargreaves Lansdown fees 

HL has also reviewed its pricing in the last year. 

• An account charge of 0.35% is levied for funds in stocks and shares ISAs and pensions (previously 0.45%) on balances up to £250,000. This drops to 0.25% on investments between £250,000 and £1m and 0.1% on investments between £1m and £2m. There is no charge on balances over £2m.

• There is also a 0.35% charge for shares, investment trusts, ETFs and bonds (capped at £150 a year).

• An online dealing charge applies for shares, ETFs, investment trusts and bonds. This starts at £6.95 a trade for up to 19 trades a month and falls to £3.95 if you are trading 20 times a month or more.

• The dealing charge for funds is £1.95.

• Additional charges apply for overseas investments.

• There are no dealing charges for funds, shares, ETFs and investment trusts that you buy using regular monthly investing.

• There will also be additional ongoing charges for your investments, which vary according to the specific holdings you choose. 

The 0.35% fee looks competitive, but the dealing fees per trade add up, especially if you invest small amounts regularly in ETFs or shares.

The OCF on funds varies from product to product, with passive funds and ETFs often having lower ongoing charges and some active funds charging over 1%.

This means the total investing costs are likely to be higher than Vanguard, but you’ll get access to a much wider choice of investments.

Is Vanguard or Hargreaves Lansdown better?

When it comes to fees, Vanguard clearly comes out on top due to its capped account fee and minimal trading costs. 

However, there are a few other factors to consider when choosing between the two platforms: 

Range of investments

HL has a broader range, including active funds, shares, and investment trusts. There are over 3,000 funds available via the platform.

Vanguard mainly focuses on index funds and ETFs, with over 80 ETFs available.

Research and guidance

HL provides research tools, fund shortlists and financial advice (for an additional fee).

Vanguard offers less support, so you must be confident in choosing your own investments and comfortable with the customer support offered via its website. 

Brand reputation

HL has over 40 years of experience in the industry. Vanguard is newer to the UK retail market, so it does not have the same reputation, although it is huge globally in the institutional space. 

While Vanguard is the cheaper option, HL offers a wider service and may be worth the higher fees for some investors who want financial advice and more investment choices. 

It depends on your preferences and philosophy towards active and passive investing. 

Can you open accounts with both Vanguard and HL? 

Most investors will likely choose one platform or the other, but you can open an account with both Vanguard and HL if you wish.

Here are some reasons why holding accounts on both platforms may be beneficial: 

• You can access a wider range of investments: For example, you can hold index funds at Vanguard and active funds or other assets at HL. 

• You can use HL for your ISA and Vanguard for general investing if you prefer their charging structure. 

• Alternatively, you can hold your core portfolio at low-cost Vanguard and use HL for satellite investments. 

• You can use HL for consolidated reporting if you have investments elsewhere. 

• You can get access to Vanguard exclusive funds and HL exclusive funds. 

• You could compare both platforms and switch assets if you are dissatisfied. 

The main drawback is that you may incur multiple account fees by holding two accounts.

For most investors it will make most sense just to use one investment platform.

Which is better for passive, long-term investing? 

If you favour a passive investing approach focused on long-term returns, Vanguard has a clear advantage. 

The ultra-low fees compound over decades, saving you thousands in the long run compared to HL's charges. 

Vanguard also has a wide range of passive index funds that track global markets at low prices, which fits with a typical 'buy and hold' strategy. 

Meanwhile, HL offers some index funds, but their pricing model makes passive investing more expensive compared to Vanguard. 

HL also focuses more on active investors who want to beat the market.

So, in summary, Vanguard is preferable if you: 

• Prioritise minimising fees.

• Prefer a simple passive strategy.

• Are comfortable with putting together your own portfolio of tracker funds.

Learn more: what are the best alternatives to Hargreaves Lansdown?

How do their investment philosophies differ? 

The differing philosophies between the two platforms are the crucial point of distinction: 

Vanguard philosophy 

• Passive investing beats active management over time.

• Minimising costs and fees for investors.

• Diversification across markets.

• Promoting a strategic long-term approach, so there’s no need to constantly buy and sell investments.

Hargreaves Lansdown philosophy 

• Offers access to a wide choice of investments, including active and passive funds.

• Offers tools to help investors pick winning investments. 

• Enables investors to take an active role in changing investments. 

• Provides financial advice and research to support active decisions.

So, in essence, Vanguard encourages a long-term passive strategy with minimal intervention, and HL provides active investors with tools to beat the market. 

The approach you align with should guide your choice of platform. Passive investors may find Vanguard is a better fit for them, while those who enjoy actively managing their portfolio may prefer HL.

Which should I choose: Vanguard or Hargreaves Lansdown? 

Regarding investment outlook, Vanguard suits passive, long-term investors compared to Hargreaves Lansdown’s model, which is more aligned to those who change their investments more frequently. 

You should weigh up these key differences to decide which platform fits your investment philosophy and needs. 

You may even choose to open accounts with Vanguard and HL if you want access to the most options. 

Want guidance before investing? 

If you don’t like the idea of choosing your own investments on a platform like Vanguard or Hargreaves Lansdown, it makes sense to get professional advice.

Unbiased can quickly connect you to a financial adviser regulated by the Financial Conduct Authority (FCA).

They can look at your circumstances and investment goals to help craft the best portfolio for you.