Vanguard vs InvestEngine: Which Low-Cost UK Platform Wins? (2026)
Two of the cheapest UK platforms for index investors, compared. How Vanguard and InvestEngine differ on fees, what you can hold, fractional investing and flexibility, and which suits you.
Written by an 11-year retail-brokerage insider. · Updated 11/6/2026
Vanguard and InvestEngine are two of the cheapest ways to run an index portfolio in the UK, and both are popular with cost-conscious investors. But they’re built differently, and the right one depends mostly on what you want to hold. Here’s a clear comparison.
The short version
- Choose InvestEngine if you want ETFs only, the lowest possible platform cost, and fractional investing.
- Choose Vanguard if you want its own funds (including LifeStrategy and target-date options) in a simple, capped-fee home, and you don’t mind being limited to the Vanguard range.
How they compare
| Vanguard UK | InvestEngine | |
|---|---|---|
| Platform fee | 0.15%/yr capped £375 (£4/mo under £32k) | £0 (DIY) |
| What you can hold | Vanguard funds and ETFs only | ETFs only |
| Fractional investing | No | Yes |
| FX cost | None (own GBP funds) | None (GBP-only ETFs) |
| Accounts | ISA, SIPP, general | ISA, SIPP, general |
| Managed option | Yes (adds 0.20%) | Yes (0.25%) |
| Best suited to | Hands-off Vanguard index investors | Cheapest ETF-only DIY investors |
Illustrative summary. Check current terms with each provider.
Cost
This is InvestEngine’s headline: £0 platform fee on DIY ISAs, SIPPs and general accounts. You only pay the ETF charges inside your funds. Vanguard charges 0.15% a year, capped at £375, with a £4 monthly minimum on balances under £32,000. Vanguard is still cheap by industry standards, but for a pure ETF investor InvestEngine is hard to beat on platform cost, especially on smaller balances where Vanguard’s £4 minimum bites.
What you can hold
Vanguard only offers its own funds and ETFs. That’s a genuine limitation if you want funds from other providers, but Vanguard’s range covers most index needs, including all-in-one LifeStrategy and target-date funds that InvestEngine’s ETF-only model doesn’t replicate as neatly. InvestEngine offers a wide range of ETFs from many providers, but no individual shares, mutual funds or investment trusts.
Fractional and flexibility
InvestEngine supports fractional ETF investing, so you can put every pound to work and build automated portfolios from small amounts. Vanguard doesn’t offer fractional shares, though regular investing into its funds achieves much the same thing for a fund investor.
FX and accounts
Neither will sting you on currency: Vanguard’s funds are GBP, and InvestEngine’s ETFs are GBP-only, so there’s effectively no FX cost on either. Both offer the wrappers most people need, an ISA and a SIPP as well as a general account.
Which should you pick?
- Lowest cost, ETF-only, fractional: InvestEngine.
- Vanguard’s own funds, LifeStrategy or target-date, simple capped fee: Vanguard.
For many UK index investors it comes down to a simple question: do you specifically want Vanguard’s all-in-one funds, or do you just want cheap, broad ETFs? The first points to Vanguard, the second to InvestEngine.
The bottom line
Both are excellent, low-cost homes for a long-term index portfolio, and you won’t go far wrong with either. Match the choice to what you want to hold and your balance size. Read our full reviews of Vanguard UK and InvestEngine, see how the fees stack up in broker fees explained, or compare them against the rest on Brokerlens.
Educational information, not personal advice. Platform terms change, so always check current fees. We may earn a commission if you open an account through our links, which never affects which providers we recommend.