St James Place concern

PannyH

I've entrusted my pension investment to St James Place, a company I consider reputable. However, I've come across several negative posts about them lately. My financial advisor, who is affiliated with St James Place, reassures me that these are merely expressions of professional jealousy and shouldn't be a cause for concern. Despite this assurance, I adhere to the belief that where there's smoke, there might be fire. Should I be genuinely concerned?

 

cloud_dog

PannyH said:

I've entrusted my pension investment to St James Place, a company I consider reputable. However, I've come across several negative posts about them lately. My financial advisor, who is affiliated with St James Place, reassures me that these are merely expressions of professional jealousy and shouldn't be a cause for concern. Despite this assurance, I adhere to the belief that where there's smoke, there might be fire. Should I be genuinely concerned?

 

MRDA (Mandy Rice Davis Applies).

I believe you are right to be concerned.  In this instance the smoke is real and a full blown fire.  Their charges are high (compared to other independent financial adviser services), and their fund performance can generally be best described as 'lacking'. 

Although in their defence, they probably do produce the best and shiniest leaflets going.

Pat38493

PannyH said:

I've entrusted my pension investment to St James Place, a company I consider reputable. However, I've come across several negative posts about them lately. My financial advisor, who is affiliated with St James Place, reassures me that these are merely expressions of professional jealousy and shouldn't be a cause for concern. Despite this assurance, I adhere to the belief that where there's smoke, there might be fire. Should I be genuinely concerned?

 

I don't think they are disreputable so it's not like you are going to lose all our money or something like that.  However, they have a reputation for having high charges that are not justified by the performance of their funds.

If you are paying a lot of money for pension advice, ideally you should look for an IFA (independent financial adviser) and not an FA.  An FA will be tied to a company like SJP.

wjr4

Nobody is jealous of SJP!

dunstonh

I've entrusted my pension investment to St James Place, a company I consider reputable.

There are no concerns over what they do from a suitability point of view (although their rep in our area tends to overdo investment bonds in trust)

 However, I've come across several negative posts about them lately. My financial advisor, who is affiliated with St James Place, reassures me that these are merely expressions of professional jealousy and shouldn't be a cause for concern.

Your FA is a sales rep.    So, you should expect a salesrep style response and that is what you have got.  I am an IFA and I am not the slightest bet jealous of SJP sales reps.  Indeed, I would be embarrassed if I was in their shoes.

Last year we had a potential new client with £500k to invest.  Our charge was £2,500.   SJP charge was £25,000.   That is the first major issue with SJP; they are damned expensive.       The second issue is that they are sales reps of their own product.

An IFA cannot match SJP in respect of glossy brochures as the IFA will be using the laser printer in their office and not spending the money on professional printers.    

 Despite this assurance, I adhere to the belief that where there's smoke, there might be fire. Should I be genuinely concerned?

On the suitability of the product?  No
On the cost and charges you are paying?  yes

The general rule of thumb here is that you should either DIY or use an IFA.    Not use FAs/sales reps.

BritishInvestor

cloud_dog said:

PannyH said:

I've entrusted my pension investment to St James Place, a company I consider reputable. However, I've come across several negative posts about them lately. My financial advisor, who is affiliated with St James Place, reassures me that these are merely expressions of professional jealousy and shouldn't be a cause for concern. Despite this assurance, I adhere to the belief that where there's smoke, there might be fire. Should I be genuinely concerned?

 

MRDA (Mandy Rice Davis Applies).

I believe you are right to be concerned.  In this instance the smoke is real and a full blown fire.  Their charges are high (compared to other independent financial adviser services), and their fund performance can generally be best described as 'lacking'. 

Although in their defence, they probably do produce the best and shiniest leaflets going.

For the average SJP client with ~£175k invested, I don't think their fees are particularly high. 

The performance of their portfolios is broadly in line with the ARC benchmarks (albeit trailing a "no-brainer" portfolio).

artyboy

Next time the OP visits their SJP office, maybe they should take some time to look at the very nice cars parked outside. The ones that the OP is paying for...

Pat38493

artyboy said:

Next time the OP visits their SJP office, maybe they should take some time to look at the very nice cars parked outside. The ones that the OP is paying for...

I heard a story the other day about an investor who was being shown round the offices of some big investment company and they were very keen to point out in the employee car park, "that's so and so's ferarri, that's whatisnames Porsche" and so on.

The investor then asked "so where are the Ferrari's belonging to your clients parked?

QrizB

Pat38493 said:

artyboy said:

Next time the OP visits their SJP office, maybe they should take some time to look at the very nice cars parked outside. The ones that the OP is paying for...

I heard a story the other day about an investor who was being shown round the offices of some big investment company and they were very keen to point out in the employee car park, "that's so and so's ferarri, that's whatisnames Porsche" and so on.
The investor then asked "so where are the Ferrari's belonging to your clients parked?

That's in a similar vein to the joke about my investments having paid to put two children through private school. No, not my kids, my FA's ...

dunstonh

For the average SJP client with ~£175k invested, I don't think their fees are particularly high. 

About double what you can get with an IFA / DIY

BritishInvestor

dunstonh said:

For the average SJP client with ~£175k invested, I don't think their fees are particularly high. 

About double what you can get with an IFA / DIY

For IFA:

FCA show adviser initial at 2.5% and ongoing at 0.8%. Total ongoing 1.9% pa.

https://www.fca.org.uk/publication/corporate/evaluation-of-the-impact-of-the-rdr-and-famr.pdf

SJP initial of 5% (headline rate, I've heard of people haggling) on ISAs and 0% (explicit, ignoring exit fees early withdrawal charge) on pensions/bonds.

As you point out (for your £500k example), as the pot sizes increases, independent fees will tend to come down (in % terms), but I don't think that's the case for the "average".