Should i move my SJP Pension

PPDPPD

Hi all, i am looking for a bit of guidance. I have circa 260K in a SJP pension that i have held for circa 2.5 years. in my view the pension is under performing at less than 1% per month i know i will get hit for exit fees but i am trying to decide if it is worth taking the hit? I am 55 years old, i have another L&G workplace pension with circa 30K in it. should i move the SJP in to the L&G 
Thanks in advance for your feedback.

cloud_dog

PPDPPD said:

in my view the pension is under performing at less than 1% per month...

Are you sure?

I would be quite fairly content with 12% pa.

dunstonh

Hi all, i am looking for a bit of guidance. I have circa 260K in a SJP pension that i have held for circa 2.5 years.

SJP are near unique in that they backend their charges. i.e. if you transfer out in the first 5 years, they hit you with a penalty.   However, they are also one of the most expensive companies in terms of annual charges.   So, often it is viable to pay that charge to get out if you are going to save each month thereafter.

 in my view the pension is under performing at less than 1% per month 

That doesn't sound like underperforming.   2022 was a negative year.   2023 was a positive as is 2024 to date.   double digit annual returns over that period doesn't sound like underperforming (although SJP funds are generally middling to under).

 i have another L&G workplace pension with circa 30K in it. should i move the SJP in to the L&G 

You have told us nothing about the SJP pension and nothing about the L&G pension.   So, we cannot answer that.   The little bit you have said about performance suggests you have a misunderstanding in how these work and what the expectations are.   So, that needs to be cleared up.   Whilst the workplace pension will certainly be cheaper, you could be putting it into different risk levels which could harm your overall returns.

gm0

Some sums needed

You need to get to grips with the "exit charge" that applies.  Dressed up in fancy language.  Dropped for new customers now. Still applies to existing.  Exit charges will shortly move to "contribution" i.e. entry charges. It's a costly wealth manager with a complex obfuscated product.  You can do better on returns net fees and can find another portfolio IFA advised or DIY that offers a better share of the pie for you for a similar level of investment risk taken

Aside from the SJP "total costs" to run each year - platform, advice, fund.  You need to allow for the deferred management charge on exit.

Then you can calculate the cost for what you do next.  The running cost, the entry cost, the advice cost (if there is any).  And net off any incentives as may arise with DIY platforms

https://www.fidelity.co.uk/pension-transfer/#cashback-offer

Example - no entry fees as %.  But will pay for some trades to buy funds.  £750 to offset platform fees for the initial period.  You can live on fidelity at £90 pa plus the trades to setup with ETFs.  With funds used and a small portfolio there are cheaper platforms. Shop around.  Other platforms with cashbacks are also available each year. Choose a poison that suits your planned investments.

With an adviser (IFA this time) involved - there is a negotiation about initial charge to take you on and set you up and process the migration from SJP.  Ongoing advice may be cheaper at 0.5%. or so.  But the entry charge - let's call it 1% before any negotiation takes place - gets added to the SJP exit fee and this may be galling.  And delay the "break even" number of years of moving.

No point in waiting.   They will eliminate exit charges soon.  But I would put money on a bet that they will let existing ones run off and not cancel them.  So for that element the time since your last contributions <5 years matters.

It will take a few years to break even.  But you will be free of their clutches.