St James Place Wealth Management

segovia

ColdIron said:

Those Porsche Cayennes won't pay for themselves

In seriousness, the criticisms are well founded. There is nothing wrong with their advice but you will be restricted to their own in-house funds rather than whole of market. Nothing wrong with their funds but they tend to be mediocre, some often feature in 'dog funds' lists

The most frequently highlighted issue is their charges. Whereas most advisers are now required to make an explicit charge for advice, SJP (because of their business model) continue to 'bundle' them with their other charges which makes them less transparent

From memory (as I can only see a mostly blank page from your link), for unit trusts in an ISA they levy a circa 5% initial fee on fund purchases. This method of charging for advice is practically unheard of elsewhere. A friend of mine with SJP is continually worried about 'churn' when being advised on change of investments

Within a pension there is a tiered early exit fee, 6% if 6 years remaining, 5% for 5 etc. Again this is to pay for the advice but it can make leaving them expensive if you change your mind

Still, they do have many happy clients (my friend amongst them, although he has chosen to self select elsewhere for new money). A lot of it comes down to your relationship with your 'partner'

https://www.sjp.co.uk/~/media/Files/S/SJP-Corp/document-library/our-charges/SJP11539_Pension_Charges_Summary.pdf

Diplodicus

What first attracted her Financial Adviser towards a transfer recommendation for this million pound DB pension?

Well the rigorous hurdles seem to have been overcome in this case and the transfer looks all but settled. The good news is the exit fee is "only" £10k. Assuming she has a ready alternative.

EDIT: Not so fast..Coldiron is right, it would cost £60,000 to move the pension away from them. That's awful.

segovia

Diplodicus said:

What first attracted her Financial Adviser towards a transfer recommendation for this million pound DB pension?

Well the rigorous hurdles seem to have been overcome in this case and the transfer looks all but settled. The good news is the exit fee is "only" £10k. Assuming she has a ready alternative.

Maybe he needs to upgrade his 2019 Porche to a 2021 plate 

segovia

segovia said:

Diplodicus said:

What first attracted her Financial Adviser towards a transfer recommendation for this million pound DB pension?

Well the rigorous hurdles seem to have been overcome in this case and the transfer looks all but settled. The good news is the exit fee is "only" £10k. Assuming she has a ready alternative.

Maybe he needs to upgrade his 2019 Porche to a 2021 plate 

PS - 4.5% initial advice fee £45,000.00 + £10,000.00 exit fee, I would say minimum exit in year 1 would be £55,000.00 

Diplodicus

Yes, looks like it. Absolutely shocking. 

The other worry, of course, being that with such huge incentives or disincentives (fear of a later claim) - regardless whether the transfer is assessed by an FA or IFA, the DB Pension transfer advice process looks hopelessly compromised. Giving up the existing pension may not even be her better option.

Sunnylifeover50plan

If her husband transferred a couple of years ago then it will be easier for her to assess value add?

I had a look at a friends investment with them, they have "own funds" and a charge structure which front loads fees and passively locks people in for 5 years but it's all in their packs and there to read. My friend will need a very good return year on year to mitigate the risk of charges eroding the value.

dunstonh

Last person I saw who had us competing against SJP had £500,000.  SJP were charging £25,000 initial fee to our £2,500 and the solution we offered from the whole of market was half the annual cost of SJP.  That gives an indication of the cost differences.

We also did a pension transfer away from SJP some years back which holds the record for us of the largest cost saving.    The difference in projections using the same growth rate (so only charges are the difference) was over £300,000 lower with SJP.  In other words, the effect of charges reduced the pension by £300,000 if the same growth rates were achieved.

A decent IFA should be able to walk all over SJP in terms of product and investment availability due to being whole of market.  However, SJP will be able to walk all over an IFA with presentation materials as they spend fortunes on glossy brochures etc.  IFAs print what is necessary on the office laser printer.

In general, the choice should either be to DIY or use an IFA.    Not to use tied FAs/sales reps.

segovia

Sunnylifeover50plan said:

If her husband transferred a couple of years ago then it will be easier for her to assess value add?

I had a look at a friends investment with them, they have "own funds" and a charge structure which front loads fees and locks people in for 5 years but it's all in their packs and there to read. My friend will need a very good return year on year to mitigate the risk of charges eroding the value.

They are not the type of couple who would proactively monitor charges and performance, they trust their advisers and associates are doing their job correctly and diligently. It reminds me of a conversation we had with another of my wife's colleagues who said quote "you never see the charges, they come out of the fund automatically"  - with her mindset if you can't see them they they don't really exist. If she got an invoice for 10K at the end of each year she may think differently. 

Stubod

...."reassuringly expensive"....

..a bit like Audi's and Waitrose..

Sunnylifeover50plan

segovia said:

Sunnylifeover50plan said:

If her husband transferred a couple of years ago then it will be easier for her to assess value add?

I had a look at a friends investment with them, they have "own funds" and a charge structure which front loads fees and locks people in for 5 years but it's all in their packs and there to read. My friend will need a very good return year on year to mitigate the risk of charges eroding the value.

They are not the type of couple who would proactively monitor charges and performance, they trust their advisers and associates are doing their job correctly and diligently. It reminds me of a conversation we had with another of my wife's colleagues who said quote "you never see the charges, they come out of the fund automatically"  - with her mindset if you can't see them they they don't really exist. If she got an invoice for 10K at the end of each year she may think differently. 

on a million you can probably double the 10k a year fee and then some plus the transfer fee and initial advice. You'd think people with a sizeable sum would have a more diligent attitude to investment options.