Looking for some advice

xylophone

Thanks for the above replies - I appreciate the honest feedback.

https://www.ftadviser.com/pensions/2017/11/09/flaws-in-british-steel-pension-transfer-advice-uncovered/

https://www.ft.com/content/26f238aa-5fe3-11e7-8814-0ac7eb84e5f1

http://www.bspensionschoose.com/faq.html - have you read through these?


Felix, who might want to transfer out in the future

Felix is still a few years away from taking his pension. He doesn’t know yet what his plans will be, but he thinks he might want to transfer out to a different pension arrangement. He knows that he would probably get a better transfer value if he transferred out of the current scheme rather than from the new scheme. But he wants to keep his options open, so doesn’t want to transfer out at the moment. He knows he won’t be able to transfer out of the Pension Protection Fund, so he chooses the new scheme. He fills in his option form to tell us his choice.

Worried_investor

Yes I have read the above, but none have really helped and often asks more questions.

Not sure what the ‘Felix’ example was for?

xylophone

Like the example, you are years from taking the pension.

You say that you are "exploring" a transfer out.

Does this mean that you are not sure and would wish to keep your options open until later?

mgdavid

Worried_investor wrote: »

........
I have no idea how much I will need when I come to retire. ..........

methinks you need to sit down with pencil & paper and do some basic sums....
Have you read the 'Pensions planning - the Number' thread?

https://forums.moneysavingexpert.com/discussion/2146737

Worried_investor

xylophone wrote: »

Like the example, you are years from taking the pension.

You say that you are "exploring" a transfer out.

Does this mean that you are not sure and would wish to keep your options open until later?

Okay, I get you now.


Yes, keeping my options open would be preferable - even if it was enough time to consult other IFA's.


However, it's made a little more difficult knowing that this transfer value is only going to drop in the new scheme. So it's pretty much now or never, unless things change dramatically in the distant future.

Mutton_Geoff

Worried_investor wrote: »

One of these is SJP and as said above, the fees seem pretty much in line with others I have enquired with - around 2% ongoing charge and a 6% transfer out fee if I decide it's not for me and leave in the first 5 - 6 yrs

I am with SJP and about to transfer out to my own SIPP. What you haven't mentioned (because perhaps they haven't told you) is the vertical marketing aspect of SJP. They only sell their own products so as well as the charges above, you'll be paying their own fund AMCs too.

SJP have just undergone major fund restructuring this month. I haven't looked into the reasons why as I'm on my way out.

This is worth a read although I am not recommending this firms products, their report is interesting.

https://www.yodelar.com/insights/st-james-place-review

Worried_investor

I have been told that ‘total’ fees, absolutely nothing extra would be in the 1.7-2.2% ballpark.

Worried_investor

That said, I have become aware of the poor performance of SJP investments!

sandsy

Dunstonh said it best - SJP’s charges are smoke and mirrors. See this page:

https://www.sjp.co.uk/wealth-management/retirement-planning/charges

Read it very carefully as it gives you the charges in two different ways.

The first way tells you what their separate advice and product charges are.

So as soon as you go with them, you lose 6% of your investment - 4.5% goes to the advisory arm of SJP advice and 1.5% goes to the product manufacturing arm of SJP. As indicated previously, SJP advisors can only sell you SJP products.

After that, you will pay 0.5% for advice each year. For the product you will pay 0% for the first 6 years then from year 7, you’ll pay 1%. You will also pay investment management charges which depend on the funds you choose.

If you leave the contract, you’ll pay 1% of any amount attributable to a contribution made in the last 6 years.

The second way they explain their charges is by combining the product and advice charges. Their advisers prefer to do it this way as the charges look less. So they tell you, that overall you’ll pay 1.5%pa. However, this again excludes the fund charges which are additional. However, if you leave the contract early, the story is that you’ll get charged 6% on investments amounts attributable to an investment paid in the 12 months, 5% on amounts in the last 12-24 months, 4% on amounts in the last 24-36 months etc.

Both ways are equivalent.

If you invest and leave after 12 months, you’ll have paid 7.5% under either method. Either 6% upfront then 0.5% for advice and 1% exit charge. Or 1.5% combined charge plus 6% exit charge. Plus any investment management charges.

Similarly for other years. With a one-off investment, leaving after 7 years, you’d have paid 6% upfront, 0.5% each year for 7 years, 1% product charge in year 7, a total of 10.5%. Or the other way, 1.5% for 7 years which is also 10.5%. And for both, the investment management charges.

The first way lets you compare advice and product charges with other advice and product companies. Remember to include investment charges in any comparison. The second way doesn’t as no one else expresses their charges that way.

bostonerimus

Whether you go with a firm like SJP, an IFA or a DIY SIPP etc via a platform like H&L, it's important to understand the Ts&Cs.........too many acronyms? Some investment firms will snow you with jargon and hide the costs. If you don't understand something it's not because you are dumb, it's because it hasn't been explained properly, either by accident or deliberately. So keep things simple, ask questions, never be scared to walk away and take control of your own money.