St James Place concern

Somebody

All the bad press they have been receiving doesn't surprise me one bit.

In my youth I naively got talked into starting a pension with J Rothchilds, now SJP.  Then they persuaded me to start a "pension mortgage", basically saying that I would use the tax free cash to pay the mortgage off.  "Don't worry about the higher fees as you're getting higher returns", they said.  So I had 2 plans with them at the time.  This was in offices in Mayfair.

I then joined a company with a DB pension scheme so SJP turned the contributions to FSACs.  I was then made aware by my DB scheme that I would be better off making AVCs into the DB scheme.

Long story short as they didn't offer me best advice on the AVCs I took them to the Financial Ombudsman who made them enhance my SJP funds as the DB scheme would not retrospectively accept the AVCs.  I've since transferred out to a DIY SIPP.

Cookieno1

I invested with St James ridiculous bad return over 5 years, would have been better off with high street banks , my opinion runaway fast 💨 much much better options out there 

dunstonh

Cookieno1 said:

I invested with St James ridiculous bad return over 5 years, would have been better off with high street banks , my opinion runaway fast 💨 much much better options out there 

I just checked SJP performance over 5 years and 41 of their funds performed better than cash over that period.  23 of their funds didnt.

The ones that didn't won't surprise anyone.  Fixed interest securities, global small cos, money market, absolute return, property and emerging markets.     

katejo

Cookieno1 said:

I invested with St James ridiculous bad return over 5 years, would have been better off with high street banks , my opinion runaway fast 💨 much much better options out there 

So what action did you take to break away from them after the 5 years? I only have unit trusts and ISA with them not a pension.

Bostonerimus1

dunstonh said:

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

Where does it say that about IFAs?   
The charges are all types of advisers, which includes SJP.

SJP initial of 5% (headline rate, I've heard of people haggling)

Indeed, yes.  It is disgraceful that haggling still exists. The FCA frown on that.   If you can offer lower charges like that for one person then why can you not do it for another.   You are basically mugging the inexperienced individual who is less savvy.

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".

Average is always a risk to use as the lower cost firms are unfairly tainted by the expensive firms.
SJP is one of the most expensive distribution channels in the country.

And as for ongoing,  I am working on some client work for someone at the moment with just £130k where their total ongoing charges are 0.93%.  There are several top ups across multiple wrappers with no initial charges.  And IFAs and providers/platforms IFAs use cannot charge exit charges.

Part of the disappointment many people are having with their investments/DC pensions right now is due to the constant drag of fees. When returns are good the fees get obscured, but when returns are poor they just compound the misery. As people start drawdown they will find themselves spending a large part of their annual withdrawal on fees; 2% or even 1% ongoing fees will probably be their largest expense and in bad years it will still have to be paid. SJP seem to be expensive and if you can DIY you will save on those fees and you could have twice as much to spend on yourself.

Weights

Regarding St. James Place.   My wife and i have had investments with them for more than 15yrs. We have never been disappointed, We had no problems with them even during the big financial crash of 2008. The advisor has helped members of our family, with no regrets. I would still tend to trust our advisor despite some of the bad press regarding charges.

artyboy

Weights said:

Regarding St. James Place.   My wife and i have had investments with them for more than 15yrs. We have never been disappointed, We had no problems with them even during the big financial crash of 2008. The advisor has helped members of our family, with no regrets. I would still tend to trust our advisor despite some of the bad press regarding charges.

Clearly we want to welcome newbies to the forum. But I hope you will appreciate that I and others may approach a new account, apparently created to make a post on a thread nearly 2 months old, with just the tiniest amount of scepticism.

Still, if your SJP salesperson is making you happy despite the huge relative charges, then obviously great for you...

dunstonh

Weights said:

Regarding St. James Place.   My wife and i have had investments with them for more than 15yrs. We have never been disappointed, We had no problems with them even during the big financial crash of 2008. The advisor has helped members of our family, with no regrets. I would still tend to trust our advisor despite some of the bad press regarding charges.

And how often have you compared it to mainstream alternative cheaper options?      If you don't know any better, then you won't know.

QrizB

artyboy said:

Still, if your SJP salesperson is making you happy despite the huge relative charges, then obviously great for you...

I guess it's a bit like paying to fly Business Class rather than Economy.

You get more comfortable seat and a fancier meal during the journey, but end up in the same place - and rather poorer.

handful

I know that it means nothing without specific dates, investments and "timing the market" etc but I switched my SJP pension into my SIPP after over 2 years of stagnation in November last year. I put it straight into one of the HSBC Global Strategy funds and it's currently up over 7% since then in less than 3 months. Like I say, I know that could go in an instant but I just feel so much happier having escaped their grasp. I just wish I'd done it earlier and just written the escape fees off.