St. James' Place - Pensions - Am I stupid for being concerned?

Qyburn

Make of this what you can. It seems like they've watered down the early withdrawal charge a bit by charging a high initial fee, balanced by a discounted annual rate for the first 6 years to give more or less the sme effect.

Advice charges

We charge for our initial advice and for our ongoing advice. 4.5% of your initial investment will be used to pay for initial advice and an annual charge of 0.5% will be charged for the ongoing advice and the relationship with your adviser.

Product charges

There will be an initial product charge of 1.5% of your investment. There will also be an annual product management charge of 1% but this will be waived in the first 6 years for each investment. If you encash within the first 6 years of an investment there will be an early withdrawal charge of 1% of the value of your fund in respect of this investment. After 10 years, the annual product management charge will reduce from 1% to 0.85%.

wjr4

They should absolutely not be contacting you on LinkedIn!!!!

barnstar2077

Run away, run away!

On a more serious note.  Why not start a new thread outlining your current position and why you think it may need changing and asking for peoples opinions?

gm0

Pemrock16 said:

- SJP are one of the most expensive and there are some reports showing that fund performance isn’t exactly the best, so effectively paying more for average results. He said that E&Y did a report which shows SJP to be 4th cheapest of the top 20 firms overall.

Being cheap among a list of wealth managers - the most expensive big firms is true and misleading at the same time.

- Early Withdrawal Charge – I read somewhere that if changes are made within that initial 6-year period, the clock restarts. I’m told this is incorrect. 

SJP have stopped doing this for new pension customers.  It is old news paraded as evidence of their evil.  They have gone for new evil.  And moved the fee across to a higher than before initial charge.  Existing customers like my family member are still subject to the EWC.  So the adviser is not lying but see above.  It's still expensive and almost the same price as before.

- Restricted advice – I read that it’s much better having an Independent Financial Advisor who isn’t restricted is better than a restricted advisor. The advisor says that they have global exposure and access to the best fund managers in the world which gives better flexibility for client fund selection. Does that access/exposure outweigh the fact that they are restricted only to SJP funds?

The Polaris multi-asset they sell most people rather than the high net worth discretionary portfolios are just an expensive wasy to hold multi-asset funds.  High advice charge.  High fund management fee vs what is available.  Net fees longer term average performance of SJP isn't wildly attractive - and a big part of that is the high drag from fees.

- I was concerned about the FSCS scheme if I invest all of my pension with SJP and the lack of protection for over £85k. He said that all pension investments at SJP are 100% FSCS protected which is no different to any other UK pension provider. I might be wrong on this, but it’s a costly mistake to make if I’m not and I’d be tied in for 6 years whilst whatever the pension grows to in that time over £85k wouldn’t be protected.

You need not worry about this particularly. Fund unit custody arrangements make total loss of investments unlikely.   In an insolvency with a mess to clear up the money has to come from somewhere.  A tax on other customers was suggested at a recent SIPP platform failure (with overseas illiquid stuff to clean up).  But in the end this bad precedent was avoided again.  This time.   Insured funds are 100% FSCS.  Uninsured on SIPP platforms are 85k.  Neither regimen nor the custody arrangement fully separated assets from company defence is fully battle tested in the courts for a major failure where major lawsuits can be expected.  See also Equitable Life. I do have 2/3 of my pension still in insured funds - because it was easy (for my existing provision). Not because it was that important.  A helpful en passant item - not a fundamental requirement

- Fees: it’s 1.76% per annum with an early withdrawal charge of 6%, decreasing by 1% each year for the first 6 years. I mentioned about SJP changing their fee structure in late 2025 due to increased regulatory scrutiny (consumer duty/fairness/transparency) and client concerns.

Passive global equities investment without advice is south of 0.3% all in drag.  And no initial charges.  Do they beat that consistently by 1.5% cumulatively.  Of course they don't.  If you and your sales rep / SJP partner agree a particular and adventurous portfolio - it may shoot the lights out.  Or crater horribly.  Or both over time.  Just as you could do yourself with a similar asset mix.  I am not an IFA and don't use one.  I have used SJP (helping a family member).  It is an expensive way to get the other financial planning and tax benefits of having advice.  An independent adviser at 0.5% provides the same regulated processes around pensions for substantially lower cost upfront and ongoing.   When markets are benign they come in around/sub market.  Not to scare the horses.  And lose the assets under management.  I am not convinced by what I have seen that their investment committees and active management provides meaningful protection in a downturn.  A criticism which can also be applied to IFA recommended long term portfolios as they don't react and trade you out of trouble either.  Because doing that is not part of the deal.  Even if it forms part of the naive expectations of many.,

- Negative client feedback: there’s an unquestionable amount for SJP overall. But barely any feedback online in independent locations for this particular advisor (the only client feedback is on their own LinkedIn and SJP website, etc.).

Plenty here.  They are the poster child evil wealth manager in these parts.  This is because they are successful have grown huge with their formula.  And target a wealth level that frequents MSE.



- I mentioned that I don’t know if I would have necessarily chosen SJP if I’d have done my research before being ‘cold’called’ on LinkedIn which was met with a comment that made me feel a little bit stupid/naïve. He said that it was possibly an easy response to those that haven’t worked with someone like him before. I haven’t worked with a FA advisor before but to suggest that my uneasiness about working with SJP or him is down to my naivety does make me feel a little bit like he thinks I’m stupid.

Networked sales is one of the ways they operate. Introduce a friend as prospect relationship sales is just a common tactic (for lots of providers).  Nothing to see here.  You build a potential trust relationship with the individual who will be providing the general advice around the product - and can tolerate the immense extra costs of the product.  Or you don't.  If you take advice - you need to find and build that trust relationship with someone.

- I mentioned that I’d like to wait until the new SJP fee structure is in place, but it seems like he wants to steam ahead regardless. It feels like he wants to get this all sorted quickly so that I'm tied into the 6 year exit fee schedule before the new structure comes into place which makes me feel uncomfortable.

He wants to close.  Don't let them.  Stop.  Think.  Learn. Review. Make an informed decision (which is PROBABLY not to use them and to go somewhere else. 

 

Am I stupid for challenging all of this and not feeling comfortable with moving forwards?

Not at all

Storcko14

Cobbler_tone said:

zagfles said:

They used LinkedIn to "cold call" you?? Does that comply with LinkedIn's terms? 

Touting for business and 'selling' is about 90% of the contact activity on LinkedIn. 

I'd apply a fair chunk of that 90% to the incessant humble bragging that some seem to think attracts employers.

optoutDB

Pemrock16 said:

Am I stupid for challenging all of this and not feeling comfortable with moving forwards?

I think you'd be stupid to pay them anything.  Do you normally buy whatever cold calling salesmen offer you?

Luckily you've come to the right place.

Cobbler_tone

Storcko14 said:

Cobbler_tone said:

zagfles said:

They used LinkedIn to "cold call" you?? Does that comply with LinkedIn's terms? 

Touting for business and 'selling' is about 90% of the contact activity on LinkedIn. 

I'd apply a fair chunk of that 90% to the incessant humble bragging that some seem to think attracts employers.

I rarely dip in these days and certainly don't post. I am tired of seeing some 20/30 something pictured smiling at some business/corporate event, accompanied with some words of empowerment or an attempt to coach anyone unlucky enough to come across it. 
I'd love to know what their actual tangible output is for their six figure salaries.
The more I see, the more I think it is probably me that is the issue. 

MakeItEasyAndClear

You are right to be concerned as others have pointed out.

As a holder of a SJP pension, I have just read their charging document today and it says nothing about ongoing charges for holders after six years.  It says a lot about in the first six years but there is nothing about after six years.  It isn't open about the charges and seems to want to hide them.  it may be stated on their website but the information sent out before the annual review says nothing about charges.  I am so fed up of stating this to them and if I wasn't near retirement, I would not have my pension with them.  This last year growth has been better but in previous years it has been dreadful with 2022 a loss of 9%!!  And they dodged that one...

QrizB

MakeItEasyAndClear said:

... I wasn't near retirement, I would not have my pension with them.

You've probably got another 20 years until your investments stop being relevant. Do you really want another 20 years with SJP, when you could switch away now?

Cobbler_tone

MakeItEasyAndClear said:

This last year growth has been better but in previous years it has been dreadful with 2022 a loss of 9%!!  

If it makes you feel any better, mine (along with many, many others) dropped over 10% in 2022. There was stuff going on.