St James Place pension and investments

[calli335]

I have an SJP advisor coming to see me on Wednesday to talk about a pension and investing some of my savings. Does anyone have any experience of SJP and whether they are a good company to invest with? TIA

Very smooth, glossy and expensive. They will tie you in with eye-watering early exit penalties. Only recommend their own range of funds, which aren't necessarily as well-performing as their literature might suggest. Some of their advisers may have your best interests at heart, but first and foremost they are salesmen.

When I looked at possibly using them, I got a similar impression to Sunseed. They're a very big company but the range of products seemed limited and fees high. We're using an online platform to invest our pensions and other money - very easy to manage and low fees. However, if you feel a bit out of your depth making investment decisions, you could also explore using an IFA.

Thank you for your advice. I've postponed the meeting to have a think!

Use an IFA every time . Smooth operators , v. expensive .
The one we know loves to talk about his celebrity clients.

You can do better than SJP. Find a genuinely independent financial adviser and although you’ll pay a fee for advice it won’t be hidden inside the sub par products you’ll be sold otherwise.

We had a genuine IFA who sold to SJP. Our investments have performed well but the the watering fees are annoying and now we're kind of stuck with them.

Just use an online platform - there are plenty to choose from, with different fees, but all will have a wide range of funds to invest in, with levels of risk to suit all.

You just need to make sure you drip feed money monthly (rather than a lump sum) to smooth out the peaks and troughs of stock market, and into more than just one fund, so spreading the risk. We have been doing it 18+ yrs now, and we had no experience but have seen our money grow extremely well. Now advising kids how to invest wisely.

Very high charges on private pension plans

Thank you. I'm not sure I have the know-how to manage an online platform... Is it straightforward?
The SJP rep has stressed that I should invest a lump sum before 5 April. I was made redundant in Dec and although I have a bit of se work, my income has really gone down. Thankfully, mortgage is paid and dh is earning a good income so we're secure. My employed pension is now frozen. I have a chunk of savings which isn't doing much so I could invest some of it. The SJP rep has given us advice over the years and DHs pension is doing well apparently but I'm still cautious. He wants to see me next week. The fees do put me off but are they high because the company invest well? He's mentioned about investing in one of their stock market bonds too. .

The bonds are tax deferral mechanisms. However, if you don’t have a lot of taxable income then the tax deferral element of the bond is not worth as much to you and you’re just wrapping your money in a product where you can’t get to it as easily.

I also can’t think of a reason why you’d need to invest before 5 April. The annual ISA allowance resets but I don’t think anything else is affected.

I've only heard bad things about them I'm afraid. Very expensive. I'd cancel and say that you're shopping around.

Check out unbiased they can provide you with a list of independent financial advisers

www.unbiased.co.uk/adviser-enquiry

I think the fees are high with SJP as they're a FTSE 100 company - so a big corporate structure with a lot of overheads. You overpay in fees the way you'd overpay for windows if you used a big national company instead of your local glazier.

The terms of them doing anything better - no reason to belief they'd do anything better or worse than a local IFA. But you do come across a little clueless so one advisor or another would come in handy. To use online platforms, you'd need to have a basic understanding of tax and different investments umbrellas and vehicles.

5/4 is the end of the tax year but as far as I'm aware, redundancy lump sums are tax free so no need to get your knickers in a twist to invest in the next couple of weeks given that your taxes income this year hasn't been high.

He's using tax year end as a reason for you to invest quickly in that if you don't use your ISA or pension allowances they will be a missed opportunity. However, it's not the end of the world and if you're unlikely to max out your 2018/19 allowances due to reduced income then really no need to panic. More important that you keep enough accessible cash available in case of emergency. But he won't earn a fee off that!

Thank you all. I've given this lots of thought and I'm wondering if I really need another pension anyway. I'm 47, I have a long-standing public sector pension which I can draw at 65. We are financially secure and DH and I are set to inherit. I'm working a few hours per week and loving it. The SJP rep talks about filling the gap from age 55 if I want to retire sooner but as long as I have my health, I would be happy to work until I can claim my existing pension. I'm wondering if I would be better investing a lump of my savings in something other than a private pension?

Don't tie it up in a pension. Go for a savings account so you can access if you need. SUP have our savings in a mixed risk product that's done well for us. But even though am SIP customer I advise you to shop around. I'd also advise avoiding savings product from your bank without thorough exploration. Turns out all 3 different bank products I had only invested in their own portfolio so the returns we're pants,

My DPs spoke to a FA at the Skipton Building Society. They didn't charge for initial conversation so might be worth a try there first.

If you're working a few hours a week, you won't get a decent pension.

And obv it's better to have money in a pension rather than savings. Pensions come out of gross income and savings out of net so you're massively out of pocket if you don't invest.

You'd really benefit from speaking to a professional and going over numbers.

And obv it's better to have money in a pension rather than savings. Pensions come out of gross income and savings out of net so you're massively out of pocket if you don't invest.

That's not necessarily correct. If OP is only working a few hours a week, it's probably her salary is below the personal allowance so she might not pay tax. When she draws he pension, she might actually become a tax payer, and so whatever she puts in will be liable to income tax at a later date.

Given fees for SIPPS, she might be better putting it into an ISA, investing in some managed funds (not through SJP, who are a rip off) and drawing down the capital from age 55.

Hereward, we don't know how much the OP earns or if there's any tax liability. And anyway, even non tax payers can get tax relief/government top up on amounts up to £2880/ year (so £3600 goes in). SIPP fees vary and I actually have some at under 0.2%. She really needs to get professional advice from someone who's looked at her situation in detail.

Thanks all.

I am now a low earner - around 10K p/y, so below the tax threshold.

I should still receive tax-relief on a private pension though from what I have read?

Yes, on the higher of £3,600 or 100% of your net relevant earnings.

Are you using your full ISA allowance of £20,000 per year? You should generally look to make use of this first before using the pension tax wrapper. You can always move ISA savings into a pension later if appropriate. The underlying funds can be same as you might choose for pension. You don't get the tax relief on contributions but then you don't get taxed on the withdrawals. This may be pertinent to your situation if your public sector pension makes you a basic or higher rate tax payer in retirement. You can use ISA withdrawals to supplement your retirement income tax efficiently.

Hi, I was recently approached from a St James Place Partner, and reading through this thread is there anywhere we can actually compare the charges and performance of this company versus other companies? I'm relatively new to investing, and I found it quite difficult to get simple queries answered regarding the same. Thank you