St James's Place

amibovvered

I accepted VR from my job in July 2010 and went on a pre-retirement course just before leaving - one of the speakers was a financial advisor and all the participants were offered a free private consultation. I accepted this and subsequently invested most of my savings on their advice.

The Company was Berkeley St James Ltd - recently I've noticed a few posts making derogatory comment about St James's place.

Is this the same company? Have I made a big mistake using their services and if so would I have to cash in my investments to stop using them?

I'm usually considered fairly intelligent and articulate but I'm the first to admit I'm also pretty gullible and in an area where I'm clueless such as Finance I can be easily convinced.

It is the five year anniversary in September and the Financial Advisor I dealt with is coming back to discuss how things are going so this might be a good time to start working out my alternatives if I want to make changes.

Any advice would be appreciated.

dunstonh

Berkeley St James Ltd is not St James Place.

Have I made a big mistake using their services and if so would I have to cash in my investments to stop using them?

The group seems to be heavily into unregulated property investments. Not your mainsteam things. However, if they have used mainstream investments via the advice channel then there is no reason to see any problem.

amibovvered

Thanks for your response. The money was mainly invested in bonds with Axa (now Friends Provident?) and Prudential. The monthly fees with Prudential seem rather high and I've never knowingly paid fees on a Prudential bond before (that is to say it has never been itemised on the annual statement, I may well have paid fees not shown on a statement). I've actually been quite happy with the performance of the Axa bond, less so with the Prudential.

However, the advisor who dealt with me now describes himself (just googled him) as Associate Partner Practice of St. James's Place Wealth Management.

bowlhead99

dunstonh wrote: »

Berkeley St James Ltd is not St James Place.

The group seems to be heavily into unregulated property investments. Not your mainsteam things. However, if they have used mainstream investments via the advice channel then there is no reason to see any problem.

Perhaps on a quick google you assumed they meant St James, a division of the Berkeley Group who are into property development.

However, OP probably means this guy http://www.berkeleystjames-wm.co.uk/aboutlawrencecafferty2.html who used to do wealth seminars (now spun off as a separate business (http://www.bsjseminars.co.uk/) and became part of St James's Place a few years ago - in the time since OP first went on his seminars and signed up with the IFA.

The monthly fees with Prudential seem rather high and I've never knowingly paid fees on a Prudential bond before (that is to say it has never been itemised on the annual statement, I may well have paid fees not shown on a statement).

These days, fees tend to be explicitly shown, following the regulator-enforced move to a new more transparent regime (though some older products work on a bundled basis. You are right, previously you would have paid fees that were not separately itemised. Neither Pru nor your IFA are going to work for free.

I've actually been quite happy with the performance of the Axa bond, less so with the Prudential.

Do you have much knowledge / awareness of what sort of return should have been expected from the Pru product over the last 5 years in the economic conditions we experienced, in exchange for the risks you'd have been exposed to if the market conditions had been different? Presumably the Pru product was not intended to have given the same return as the AXA one in all circumstances, otherwise the IFA would have just put you in one product or the other and not a mix.

If we had a slump or recession rather than a continuing stock market boom over the next few years, perhaps it would be the AXA product that disappointed you more, while you would love the Pru product, relatively. But if you have a concern about one of the funds, your upcoming review would be a good time to air it.

Is this the same company? Have I made a big mistake using their services and if so would I have to cash in my investments to stop using them?

You are free to transfer your investments and / or the IFA service to someone else.

SJP are known for being expensive and an SJP IFA building you a portfolio from scratch today would use SJP products. However, the IFA was not officially part of SJP in 2010, he didn't join them until 3 years ago. If the portfolio he already built you is reasonable, and in the time since he moved to SJP he has not proposed to rip up your portfolio and move it into SJP tied products with a new set of 'initial fees', then maybe there is no problem. Perhaps he would seek to do that if you express concern with your existing holdings,and perhaps a proposed change of portfolio structure is the whole purpose of setting up a review meeting with you. Perhaps the funds you are in are actually relatively expensive for what they are, and you would benefit from a change.

SJP are not actually known for being terrible advisers - they are a big FTSE 100 company that manages £50bn of assets. They would presumably not have that status if the product was absolute rubbish and a terrible choice for all the people that use them. However, they are not known for being cheap, and anecdotally IFAs on here like Dunstonh often say they love getting customers who were previously with SJP because it can be relatively easy to make savings and add value for those customers. So there will be some people who would benefit from shopping around between advisers rather than just sticking with the one they have through thick and thin without question.

What are you currently actually paying to your FA for advice and to each of your underlying investments in fees? If you shared that info, and the actual amounts invested, people here may be able to give insight into whether that appears expensive of cheap for advice and management fees on the size of pot you have invested. If you don't know the answers, your upcoming meeting would be a good time to ask.

amibovvered

Hi bowlhead99, thanks for your response. No, it's not actually the chap you refer to. Are we allowed to name names on here? My chap has the same christian name as the founder of this site.

You are right, I haven't a clue how the bonds should be performing or how my money would have performed in other spheres so my 'liking' or 'disliking' the bonds I have is based on the fact that AXA has given a better return than Prudential.

After the first year the value of the £50,000 AXA bond was £54,000 and the £50,000 Pru Bond was £52,000 with about £1200 worth of fees listed. I thought 8% for AXA in 2010/11 was pretty good (compared with ordinary savings accounts) but 4% for Prudential not as good though still better than my ISA etc.

Other than the fees itemised in the Prudential statement I haven't paid anything else yet, we had 2 meetings in 2010 and then a quick meeting a couple of weeks ago because he thought my 5 year anniversary was in March but it's in August.

Maybe I should stick to building society accounts, the whole thing scares me a bit! I'd sort of like a S&S ISA but don't know where to start and might be too expensive to get MS's advice?

dunstonh

You are right, I haven't a clue how the bonds should be performing or how my money would have performed in other spheres so my 'liking' or 'disliking' the bonds I have is based on the fact that AXA has given a better return than Prudential.

These are questions you would expect to be answered in discussion with the adviser.

After the first year the value of the £50,000 AXA bond was £54,000 and the £50,000 Pru Bond was £52,000 with about £1200 worth of fees listed.

What about the S&S ISAs? Investment bonds are further down the pecking order from ISAs for the vast majority of people. Most recommendations for investments would expect to see ISA plus bond or ISA plus unit trust. Bond only would normally be considered mis-sale without significant justification otherwise.

Maybe I should stick to building society accounts, the whole thing scares me a bit!

That comes with its own risks (shortfall risk, inflation risk).

macca1974

bit of a worry to be fair that the adviser has only come back at the 5th Anniversary of the bonds. I might be completely wrong about this, but it sounds a bit "old school" to me in that most investment bonds would have 5 year exit penalties (to cover the 6% commissions that used to be available) and advisers would want to "review" at the 5 year point and then recommend something new and shiny to justify a new fee / commission.

If you don't understand what you have and don't know where they are invested, then these are questions that you need to ask your adviser.

dunstonh

bit of a worry to be fair that the adviser has only come back at the 5th Anniversary of the bonds.

Yes. Possibly as the 5 year penalty free period is up and he wants you to move them to SJP. There is no commission any more with IFAs and most advisers. However, SJP get round this due to the structure of their products. Another reason not to use them.