40K yearly Pension - Is it safe to have all your eggs in one basket ?

atush

RichyB71 said:

Dear Forum, 

It seems like general rule of thumb these days is to consolidate pensions. However when we talk about other investments people talk about having a portfolio spread across various assets. I have a good sized pension and contribute £40K per year through my limited company. The pot on retirement will be in excess of £1 million and that makes me nervous. Will it reach its potential ? Have a chosen to partner with the correct provider ? I don't expect to have a crystal ball solution to my financial future but it feels scary having one company in control of all that investment pot. I'm currently with St James Place. Performance seems to be tracking just below 5% growth per year. The fees are not transparent and I have a meeting booked to go through the historical charges. What are people's feelings about spreading investments across more than one pension provider. As discussed I'm a Limited Company owner so I don't plan to be moving from job to job in the coming years. I don't want to mess around with property, self managed stocks and shares, bitcoin, gold...etc I just want a good old fashioned pension. But one.....can I trust my future to just one company ?

St James place is expensive and restricted. 

So i'd stop adding money to them, and open another pension with a cheaper and better platform (or IFA if you need/want to use one).  Then as soon as you can, once the punitive exit charges drop off, i'd move your SJP pension to the new one.

Bimbly

RichyB71 said:

The pot on retirement will be in excess of £1 million and that makes me nervous. 

Think about the tax implications of exceeding the Lifetime Allowance: https://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/the-lifetime-allowance

RichyB71

atush said:

RichyB71 said:

Dear Forum, 

It seems like general rule of thumb these days is to consolidate pensions. However when we talk about other investments people talk about having a portfolio spread across various assets. I have a good sized pension and contribute £40K per year through my limited company. The pot on retirement will be in excess of £1 million and that makes me nervous. Will it reach its potential ? Have a chosen to partner with the correct provider ? I don't expect to have a crystal ball solution to my financial future but it feels scary having one company in control of all that investment pot. I'm currently with St James Place. Performance seems to be tracking just below 5% growth per year. The fees are not transparent and I have a meeting booked to go through the historical charges. What are people's feelings about spreading investments across more than one pension provider. As discussed I'm a Limited Company owner so I don't plan to be moving from job to job in the coming years. I don't want to mess around with property, self managed stocks and shares, bitcoin, gold...etc I just want a good old fashioned pension. But one.....can I trust my future to just one company ?

St James place is expensive and restricted. 

So i'd stop adding money to them, and open another pension with a cheaper and better platform (or IFA if you need/want to use one).  Then as soon as you can, once the punitive exit charges drop off, i'd move your SJP pension to the new one.

I'll be looking at the cost of exit fee's today for sure. 

Albermarle

Although all the comments about SJP are valid, you need to be fully aware that if you move to a low cost SIPP , you will not get any financial advice at all from them . Just calling Vanguard and they tell you its a great platform does not constitute advice 
The third way is to employ an IFA , if you are not reasonably knowledgeable about investing , pension tax issues etc . and you do not feel inclined or have the time to learn., this may save you money rather than doing it yourself and not doing it very well .
This will cost more in fees than a DIY investing approach, but less than with SJP. 

RichyB71

Albermarle said:

Although all the comments about SJP are valid, you need to be fully aware that if you move to a low cost SIPP , you will not get any financial advice at all from them . Just calling Vanguard and they tell you its a great platform does not constitute advice 

I agree, however I looked at the charges today for that combination of product and advice and the return was a 25% increase over the last five years a 4.75% fee for the initial transfer and 2% each year in charges. The returns have been average at best in comparison with how other products from providers such as Vanguard have performed (  between 54% and 62% ) ...I can't ignore high charges and a mediocre performance even if I have a nice bloke to chat too twice a year

cfw1994

RichyB71 said:

Albermarle said:

Although all the comments about SJP are valid, you need to be fully aware that if you move to a low cost SIPP , you will not get any financial advice at all from them . Just calling Vanguard and they tell you its a great platform does not constitute advice 

I agree, however I looked at the charges today for that combination of product and advice and the return was a 25% increase over the last five years a 4.75% fee for the initial transfer and 2% each year in charges. The returns have been average at best in comparison with how other products from providers such as Vanguard have performed (  between 54% and 62% ) ...I can't ignore high charges and a mediocre performance even if I have a nice bloke to chat too twice a year

I have a pal who resolutely feels having a nice lunch and chat with his SJP advisor is reason enough to stick with them!

Their fees are outrageous (plenty of articles on that if you Goggle/DuckDuckGo that!)

The exit fees can be eye watering too, & any lock-in (often 6 years) starts fresh with each monthly payment: hence@atush’s wise words: freeze payments & seek advise from an Independent FA (or DIY, if you now feel confident enough).

RichyB71

My Direct Debit was cancelled this morning....my meeting to discus charges past, present and future booked. I'll see how things go. Interesting article here as I prepare myself for the worst

https://citywire.co.uk/new-model-adviser/news/editors-note-sorry-sjp-i-still-dont-understand-your-charges/a1184187

MEM62

RichyB71 said:

I'm currently with St James Place. 

Oh dear......

RichyB71 said:

bownyboy said:

Both mine and my wife's SIPPs are with Interactive Investor. Both in Vanguard FTSE Global All Cap and Total Bond Index. No worries here about issues. The assets are ring fenced, so if any issue with ii then yes there could be a delay in getting it transferred to a new provider, but I don't worry about it.

I do get advice from my SJP contact 

No, you don't.  As he is restricted to selling only SJP products what you are getting is sales patter, not advice.  

handful

cfw1994 said:

RichyB71 said:

Albermarle said:

Although all the comments about SJP are valid, you need to be fully aware that if you move to a low cost SIPP , you will not get any financial advice at all from them . Just calling Vanguard and they tell you its a great platform does not constitute advice 

I agree, however I looked at the charges today for that combination of product and advice and the return was a 25% increase over the last five years a 4.75% fee for the initial transfer and 2% each year in charges. The returns have been average at best in comparison with how other products from providers such as Vanguard have performed (  between 54% and 62% ) ...I can't ignore high charges and a mediocre performance even if I have a nice bloke to chat too twice a year

I have a pal who resolutely feels having a nice lunch and chat with his SJP advisor is reason enough to stick with them!

Their fees are outrageous (plenty of articles on that if you Goggle/DuckDuckGo that!)

The exit fees can be eye watering too, & any lock-in (often 6 years) starts fresh with each monthly payment: hence@atush’s wise words: freeze payments & seek advise from an Independent FA (or DIY, if you now feel confident enough).

I have a fund with SJP and currently don't pay advisor fees (or get any advice from them) I am obviously liable to pay their EWC if I move out but from what I understand, the EWC is applicable to each contribution you make on a sliding scale over 6 years. So e.g. if I invested a lump sum originally 6 years ago and an additional contribution every month since, the original sum could now be moved without penalty, contributions from Y1 would be 1%, Y2 3% and so on up to a contribution made this year would be 6%. Am I correct in this assumption because that's what my understanding is from what they told me over the phone? TIA

 

dunstonh

I have a fund with SJP and currently don't pay advisor fees (or get any advice from them) I am obviously liable to pay their EWC if I move out but from what I understand,

Unlike IFAs and most other distribution channels, the SJP pricing builds the adviser charge into the fund AMC.   Whilst many feel this lacks transparency, they are technically allowed to do it as they are a vertically integrated firm (seller,provider and funds are all from the same company).   So, you would not see adviser fees as a separate entry as you would if it was held on a platform via an IFA.