Use St James Place for transfer of my Defined Benefit fund ?

ovenglove55

Hi, I have recently had a large transfer value quotation figure from my DB scheme. I am a deferred member, aged 54. I am in discussion with St James Place about handling the transfer, but I am a bit concerned about both their initial charges and the early withdrawal fees. I appreciate there are costs associated with doing a transfer (the SJP adviser quoted 2k for the actuarial valuation alone) but would welcome any comments as to whether this could be done in a lower cost and more flexible way?
In addition, I have around 160k in various other workplace pensions, which SJP are looking to take in transfer. Reading some of the other comments on here they don`t seem to get a good press, but are they really that bad? I am being quoted an AMC of 1.26 % plus fund fees of 0.3-0.7% which I can see is typically higher than say Hargreaves, but SJP say their ongoing advice is where the extra cost comes from . Again any comments please?  

wjr4

Do not use SJP, find an independent financial adviser who has pension transfer permissions. There are many threads on here. 

JoeCrystal

Excessively high charges and I believe they got high exit fees as well. I would find another IFA to be honest. What is your CETV value by the way and what is the expected pension at the normal retirement age?

[Deleted User]

Another option is to use a local IFA for ongoing work but they farm out the DB transfer work to a specialist. (if you want an ongoing relationship with a local IFA)

ovenglove55

The transfer value is just under 500k, with predicted pension of 11.5k p/a at age 60 so about a 43 x multiple. I have 38 years NI, so state pension is paid up, just looking for the best way to bridge the gap from say 60 until 67 until that kicks in. 

cfw1994

I have read too many horror stories about the high costs and tricky "lock-ins" with SJP on this and other forums & news sites to even think about using them.   
I'm sure they have many happy customers & highly slick & polished sales executives, but my belief is that even those customers would be happier elsewhere if they fully understood the price they pay!

Notepad_Phil

ovenglove55 said:

The transfer value is just under 500k, with predicted pension of 11.5k p/a at age 60 so about a 43 x multiple. I have 38 years NI, so state pension is paid up, just looking for the best way to bridge the gap from say 60 until 67 until that kicks in. 

38 years of NI does not guarantee a full state pension for you as you've worked under a mix of old and new state pension rules. Go to https://www.gov.uk/check-state-pension to check what your actual forecast is and check whether you will need any more years to get the full pension.

jimi_man

Notepad_Phil said:

ovenglove55 said:

The transfer value is just under 500k, with predicted pension of 11.5k p/a at age 60 so about a 43 x multiple. I have 38 years NI, so state pension is paid up, just looking for the best way to bridge the gap from say 60 until 67 until that kicks in. 

38 years of NI does not guarantee a full state pension for you as you've worked under a mix of old and new state pension rules. Go to https://www.gov.uk/check-state-pension to check what your actual forecast is and check whether you will need any more years to get the full pension.

Agreed. I've got 39 years and still need to do another 4. 

cloud_dog

ovenglove55 said:

Hi, I have recently had a large transfer value quotation figure from my DB scheme. I am a deferred member, aged 54. I am in discussion with St James Place about handling the transfer, but I am a bit concerned about both their initial charges and the early withdrawal fees. I appreciate there are costs associated with doing a transfer (the SJP adviser quoted 2k for the actuarial valuation alone) but would welcome any comments as to whether this could be done in a lower cost and more flexible way?
In addition, I have around 160k in various other workplace pensions, which SJP are looking to take in transfer. Reading some of the other comments on here they don`t seem to get a good press, but are they really that bad? I am being quoted an AMC of 1.26 % plus fund fees of 0.3-0.7% which I can see is typically higher than say Hargreaves, but SJP say their ongoing advice is where the extra cost comes from . Again any comments please?  

What attracted you to SJP?

dunstonh

I am being quoted an AMC of 1.26 % plus fund fees of 0.3-0.7%

That is not necessarily the full story though.  AMCs are not allowed to be used on anything other than pension funds.  So, both HL and IFAs would be using OCF instead of AMC.  OCFs are higher than AMCs.   However, it doesn't mean you are paying more in charges.  It is just that the disclosure of charges is to a higher level with OCF compared to AMC.

There are different methods of cost disclosure and you need to be wary that you do not compare methods which disclose more than those that disclose less.  The lower figure does not mean you are paying lower charges if different methodology is used. 

which I can see is typically higher than say Hargreaves,

its not typically higher as HL is one of the more expensive platforms and their fund range is whole of market.   So, they have funds that are both cheaper or more expensive.  Their in-house (own-brand) selections are similar in cost to SJP.

You usually find IFAs are more than happy to come across new clients with either HL or SJP as it usually means the IFA can come in cheaper.   However, DIY investors with good knowledge and understanding can usually come in cheaper than an IFA.

The choice should be between IFA and DIY.  Not FA.   You cannot DIY a DB transfer.  So, that leaves you with an IFA.      IFAs being independent will all have their own charging structures. Some will also be as eye wateringly expensive as SJP.    Indeed, I came across a rarity of one that actually charged more than SJP.   However, some will be much cheaper.   That is the nature of independent service companies and retailers in all walks of life.

wjr4

ovenglove55 said:

The transfer value is just under 500k, with predicted pension of 11.5k p/a at age 60 so about a 43 x multiple. I have 38 years NI, so state pension is paid up, just looking for the best way to bridge the gap from say 60 until 67 until that kicks in. 

Use your other pensions to bridge the gap?