St James Place -drawdown fund

Dunster273

Hi everyone
I wonder if anyone is in a similar position and has some handy pointers

I switched my pension pot in  2018 from Zurich to St.James place as Zurich would only offer an annuity and would not entertain a draw down fund

I took the maximum tax free amount on transfer and since then haven't taken anything

This past year the management fee charged was £ 4060.00 which seems a  lot for managing the money !

There are early withdrawal charges for the first 6 years tapering from 6% to 1%

and I found a small print item that the fund could be classed as a "Dormant " fund if nothing is taken out in 5 years.

St James  in addition are proposing an annuity obviously good business here 
Your thoughts would be appreciated

Dazed_and_C0nfused

What made you choose SJP?

squirrelpie

Dunster273 said:

This past year the management fee charged was £ 4060.00 which seems a  lot for managing the money !

Depends how much the pot is they are managing! But they aren't famed for being cheap.

ratechaser

squirrelpie said:

Dunster273 said:

This past year the management fee charged was £ 4060.00 which seems a  lot for managing the money !

Depends how much the pot is they are managing! But they aren't famed for being cheap.

But in the interests of balance, they ARE famed for being very expensive  

I also have to wonder why the OP chose SJP, given there were a good number of far far cheaper drawdown options in 2018. Hopefully not suckered in by slick sales patter, glossy brochures, and a game of 'find the lady' when it came to viewing the fee structures...

dunstonh

I switched my pension pot in  2018 from Zurich to St.James place as Zurich would only offer an annuity and would not entertain a draw down fund

Welcome to a moneysaving site.   As you are with SJP you may wish to seek out a moneytoburn site.

This past year the management fee charged was £ 4060.00 which seems a  lot for managing the money !

SJP are one of the most expensive out there.  Although that is mainly on the initial charge.   Their annual charges are at the upper end too but £4060 needs to looked at relative to your investment amount.  £4060 on a £200k fund is expensive but on a £1m fund its cheap.

and I found a small print item that the fund could be classed as a "Dormant " fund if nothing is taken out in 5 years.

Pension funds cannot go dormant.  

gm0

Be careful now that you have woken up to their tricks.  Small print alert from now on. Hold your "partner's" aka salesperson's feet to the fire.  In writing. Nothing on trust.  Work out how to *get out* at the best (lowest) cost and convenient timing to you if that's what you want.  You can certainly hold similar investments for a lot less drag both advised (IFA) and DIY.

Keeping you locked in with the exit provision (new investment).  Or better yet reinvestment with portfolio restructuring (if they can pull that off) is their business model.  Making leaving just too expensive to bother with and keeping it that way.  Milk Milk Milk.  Keep returns somewhere around market level so the mooing doesn't get too loud in the barn.  But that's wealth management 101 they are not uniquely horrible.  It does say "wealth management" over the door.

Mentioning annuities/offering them turns up all the time with FA and IFA due to regulated aspects.  Even if the conversation is about drawdown you still seem to get sent annuity option illustrations/paperwork.  I had an IFA conversation this week and the same sort of thing happened.  There is plenty to dislike about SJP and their (quite successful) business model - but that element is probably more benign

cfw1994

Some cheeky comments and good advice here.   Loving the idea of a moneytoburn website!

I did read recently that SJP took £1 in every £6 of DB transfers in 2020, so it isn’t too bad that anyone has got caught in their net.....and if you have a £800k pot, a £4k fee would be expected. 

I would personally look closely at an escape route though.....if you wish to remain advised, find an Independant Financial Advisor (IFA) - SJP are most certainly just FAs, and as others allude, with expensive fees and I am led to believe, average funds....

Tassie_Devil

I once heard it stood for (not my words): Suckers Just Pay, allegedly. I highly don't agree.

SMcGill

I’m sure SJP have their merits but I’d miss the entertainment value of SJP critics. They make it sound about as popular as a fart in a lift. A bad fart. In a very tall building. 

gm0

This place is a nest of DIYers and IFAs - the FAs tend to keep their heads down.  They always get a kicking and these cheeky chappies more than most because they are out there chasing what used to be called the mass affluent rather than the higher net worth + private banking crowd.  The haut couture wealth managers come up less on here and thus don't get the same regular kicking. 

Various people have tried this wealth management for the masses over the years.  I dimly recall an expensive largely failed (profitability vs investment cost) effort by Aviva/NU (with their stapled together from mergers product range and infrastructure - arguably the Microsoft of UK financial services product management - lots of random overlapping stuff - somewhat stapled. Traditional retail FS banking and similar outfits always find this difficult.  To make it profitable at low net worth and large scale - they have to make you self-serve as much as they can and to treat you badly in well obfuscated product designs.  They are generally good at this part.  Then to make it feel like a premium product and a tailored "wealth management" service they have to pretend convincingly that they aren't doing that.  And they are usually systemically awful at that part. Adding a layer of not very empowered relationship managers in a call centre doesn't usually work out that well. (Citibank/Citigold as was - pretty much all sacked now).  SJP is on more of a nice paper and letterhead "Coutts current account (Natwest underneath)" kind of back office shtick but with the franchise model "partner" salesforce.  

Changing times and people actively preferring "apps" over human interaction may be changing the shape of this finally.  Though it is still more likely an opportunity for challengers than incumbents who don't generally get a a pass on fail fast and fix it like a startup kicking out regular apps updates with abandon.  Somebody will crack well supported roboadvice on phones and scale more successfully at some point.

On SJP - if you want advice and have found someone you trust (individual not brand - relationship, communications, personal integrity) then it's nobody else's problem.  IFAs become FAs.  People join SJP.  It happens.
It's non-trivial to find and build a trusted long term relationship.  It costs what it costs. That's a priority or it's not.
Some people drive Audi.  Others drive Skoda.  They both get where they are going more or less in a car made from many of the same components. 

I too have used the SJP service so know it - as well as just recoiling from the fees (as some do here).  FA's are deemed inherently evil on MSE.  - but will not use it for my main pension.  I don't consider it good value and the complexity and product opacity offends my sensibilities.  I like and trust  my SJP "partner" as an individual but I don't care for their T&C and pension plan design so I have moved along to examine other options.

Mutton_Geoff

gm0 said:

I too have used the SJP service so know it - as well as just recoiling from the fees (as some do here).  FA's are deemed inherently evil on MSE.  - but will not use it for my main pension.  I don't consider it good value and the complexity and product opacity offends my sensibilities.  I like and trust  my SJP "partner" as an individual but I don't care for their T&C and pension plan design so I have moved along to examine other options.

Same here. In addition, my SJP partner was instrumental in opening my eyes to a more holistic retirement plan than purely investing in their products. If only they knew it but they helped build the decision making that I needed when I decided to DIY. I have no regrets in the path I took through SJP because at the time I signed the contract, I didn't know what I didn't know.