St James’s Place.

[ZealAndArdour]

Hi,

Just wondering about this company. I understand they’re quite legit and well known.

My dad (not vulnerable, self employed, works still, only vulnerability is my siblings death a few years ago and he lives alone) is very shrewd and has always looked after his assets, saved very hard and tried to make sure we’d all be okay in the future. He’s been using them for several years for various things; consolidating pensions, setting up an asset preservation trust, etc.

But he seems to be in quite regular contact with his advisor (I’ve met the guy to sign paperwork and have some things explained to me, he seems nice enough) and has also received a lot of referred business from my dad making recommendations to friends, etc. The advisor is now taking my dad and some of his pals on quite fancy days out to thank them for the referred custom and just seems to still be very much involved in everything, I thought the things he’d been engaged for were sort of contact-Intense to begin with while they were set up and then might just be yearly reviews of everything. But my dad will still get calls from this guy quite frequently, and he’ll say “oh I’m not answering that, it’s Charles, he probably wants me to invest some more money, he can wait”.

I’m just wondering if this is a normal level of continuous involvement with the financial advisor, I know my dad has good pensions and a respectable portfolio of assets, but unless I’m totally in the dark I don’t think we’re talking millionaire status.

Could there be anything shady going on? Is the financial advisor meant to be in contact this much and taking them out?

My dad would also like me to meet with him to discuss my pensions and assets and tbh I just find the smarming all a bit much, and this level of contact too intense to maintain.

Thanks.

The advisors are all independent/self employed working under the umbrella of SJP. The level of contact is defined by them and they will court high value clients particularly those who refer other high value clients. Some advisors like to be in a clients mind, others prefer to be a bit more in the background. If they are good they will "read the room" and provide a level of contact the client is happy with. One thing that often happens though is a client invests a bit, then a bit more later then says "oh I might move over this next bit, I'll see how it goes" meaning the advisor keeps in contact to be in line for the next transaction.

If you do go ahead just be clear on your parameters, if you have only your pension to move say so. If you don't want updates just tell him "great I'll speak to next year when we look at the spread of investments again" or similar.

It's not very often that I post on threads - I'm normally a lurker.

My heart sank when I saw it was SJP.

My understanding is that they are really expensive in fees and have quite punitive exit fees. There'll be a reason behind the 'free' days out.

I'd advise looking at the pension threads in www.moneyconsumerexpert.com ( this is the Martin Lewis group thread thingy).

I'd advise doing some additional research about SJP - they may be legitimate but are expensive in fees.

What about Vanguard or Interactive Investor?

I’m certain my dad will have absolutely scrutinised the fee schedule and found them acceptable, the man has limited every single trip to town that he’s ever done down to 30 minutes so he can use a free space and doesn’t have to pay for parking so he’s not easily parted with his money if he doesn’t think it’s worth it.

But thanks for the heads up, I’ll drop it into conversation next time SJP come up.

My late father moved a significant chunk of assets to SJP against advice from existing IFA. When he died and I met them to get the estate settled I could completely understand why, my father loved a good salesman and thus guy was so smooth, IFA correctly understood that the ‘service’ was more expensive than other providers for similar products, but my dad would have loved going to their fancy office and interaction with this investor who was absolutely lovely. The older IFA didn’t like the expensive letterhead paper - ‘he’s paying for that’. The investments did do okay though and they waved some exit fees I think, certainly didn’t cost much to get the money out and they were easy to deal with.

There was an article in The Times recently about someone claiming their SJP adviser put all her money in very high risk investment and lost the lot, all very strange guy denies it and since left SJP.

They are very good at marketing but within the industry have a poor reputation for flogging their own expensive investments.

They are not independent and it very much depends on who the adviser is. I have known some very good, honest people join SJP, usually as a first step towards going out on their own. I have also known some really dodgy sales people who went over to them, especially after a lot of the banks stopped giving advice.

Personally I would avoid them completely and look for a local IFA with good reviews.

Look on messenger, lots of threads. SJP have a poor reputation, but slick sales process. They are high cost, high exit fees, as your Dad is financially savvy, h3cwould be far better moving his money somewhere else.

Their exit fees are beyond scandalous. I was once offered a position with SJP as partner but declined as I felt their overall fee structure was too expensive for the clients compared to other financial institutions.
They don't have a good reputation sadly

They are entirely legit as in - not an illegal scam.

They are used by lots of very wealthy people who make lots of money through them.

But, they are painfully expensive (the golf days need finding somehow!), so people would generally make more money if they used a different adviser/ did the legwork themselves.

So in many ways they are a rip off. But as long as anyone using them is clear on their charges and capabilities, it's not a massive issue if they want to pay for the brand name/ prestige.

I wouldn't touch them with a barge pole, but there again, I understand investments and don't like golf!

Must admit when we looked around for financial advice for few years ago - SJP was a company we were warned about - their fees were an excessive percentage of our assets. We procured an advisor on day rate to answer our financial challenges - we saved about £10k. But we have friends who have no interest in managing their investments - I cringe at how easily they have been taken in by their advisor - they think he's great value for money...he might be but taking 2% of their investment every year I doubt it!

Their reputation is abysmal. Mediocre service, and exceptionally high fees.

What they do is legitimate, but better is available for far, far less. The whole model is to sell a cheap and basic service for high-end prices from a posh office.

This is an interesting thread. I'm woefully inexperienced and naive re investments but went to a financial advisor to invest 40k last week. Although the FA was lovely and not pushy, the initial start up fee to invest in a S&S ISA was 5% - amounting to about 2k of 40k with ongoing yearly fees of 1.6%. I thought at the time £2k on an initial upfront fee was really high so am thinking about it at the moment. Is this the going rate?

@averageapril I don't use an adviser and for my ISA I pay a 0.41% fee. So you can do it a lot lower cost yourself.
However you say £40k, but you cannot put £40k in an ISA this tax year, as the annual limit is £20k, per adult. Are there two of you who the £40k is being split between?

What did the adviser say you would be investing in... did they give any fund names?

I simply use a global multi asset fund... it spreads the investment over a large number of company shares spread throughout the World.
An active manager, may out perform it some years but that comes ar a high cost. The one thing with investing that you can control is your costs.

Try listening to podcasts about investing and learn to do it yourself.
Here is one about choosing a fund: meaningfulmoney.tv/BW7

Upfront fees should be 0 for a small Isa and ongoing fees less than 1%. Nutmeg and Vanguard can both do that online.

If you want proper advice and active management then fees will be more, but that is only worth it when you have more than £100K to invest

I worked for an Accountant who dealt with these and one person in particular. We would have social events where our most wealthy clients were invited. Most found the talks interesting without having to pay for the advice, some did invest and were happy with their investments through them.

@averageapril I found this online.
fees explained

This is an interesting thread. I'm woefully inexperienced and naive re investments but went to a financial advisor to invest 40k last week. Although the FA was lovely and not pushy, the initial start up fee to invest in a S&S ISA was 5% - amounting to about 2k of 40k with ongoing yearly fees of 1.6%. I thought at the time £2k on an initial upfront fee was really high so am thinking about it at the moment. Is this the going rate?

if you want to try diy have a look at fidelity or similar.

i opened an isa with them back in the 00’s when i was so naive I didn’t know about IFA’s!

i basically picked 4 funds to cover a broad spread of interests, tech, europe, americas and a special situations one. I had a read of each one and simply picked low fees and best performance.

the online management is good, i can withdraw or pay in in seconds. It’s doing very well, i have just set up a sipp with them as well.

We have used SJP for years. Very happy with our advisor, who we see as a friend now. Not pushy at all but very knowledgeable about all aspects of finance and has served us well in the setting up of our company, tax advice, pensions, will planning, ISAs etc. Yes, the fees are high but so are the results, so for us it is worth it.

Our investments have done really well since being with them. We trust his advice. Some of my pensions were moved across but more were not as he said they were better where they were. Horses for courses! Like everything, some advisors will be better than others.

*@nannynick
However you say £40k, but you cannot put £40k in an ISA this tax year, as the annual limit is £20k, per adult. Are there two of you who the £40k is being split between?

What did the adviser say you would be investing in... did they give any fund names? *

They said £20k in an ISA and the remaining £20k in a feeder(?) fund which would transfer into another ISA next year. I queried the point of this and the reply was that there was a benefit to buying units now as the unit price was low - which made sense to my admittedly naive logic

Yes, I came away with a list of potential fund names it would be invested in - UK and global companies

I work in this industry, but not as an adviser. SJP are legitimate, but as others have said, very expensive.

The biggest issue for me is that they only sell SJP funds, which underperform most other funds. As a result, I wouldn't touch them with a barge pole. My father in law uses them so I have some insight into how his funds perform relative to mine.

My advice would be to shift the lot to either AJ Bell or Hargreaves Lansdown (I have accounts with both). Using his ISA allowance if possible to keep it tax free. You'll pay between 0.25-0.45% for the annual platform fee plus around 0.2% for a passive fund or 0.5-0.75 for an active fund.

Both have lots of research, fund suggestions, managed portfolios or personal advice. 5% may not sound much but even a 1% difference in fees can add up to thousands of pounds over time.

SJP are a reputable company and they are very tightly regulated in the way that they interact with clients . They have cut down on a lot of the corporate perk stuff and are changing their image from St James’ Place (for old men who like golf) to SJP a far more modern company. They are big supporters of gender and racial equality, and big charitable donators particularly in relation to education and social mobility.
I am currently a client and our broker is sorting me out some insurance . I would say the level of personal service is very high but to be honest I like the time and effort my broker is putting in to get things right and make sure I am happy.

They are legitimate and for the right client can add value. They can help with iht planning and can save a lot in that. My wealthy fil is a big fan he is self made and no fool.

For the avoidance of doubt, you shouldn't be needing to pay an "initial" investment fee (% charged when you invest). The big DIY platforms haven't charged these for years.

That model is a bit of a hangover from 20 years' ago. If you feel you need to pay for financial advice, I'd pay a flat fee up front rather than a % of ongoing investments.

But, in terms of your pension, there's some great, low cost options available.

If I gave one piece of advice, it's to have a look at how your actual/proposed funds perform against their peer group on the Trustnet website. It's really straightforward to do (even my kids can use it) and you can see the perennial under-performers/bottom quartile over 3-5 years.

@averageapril Ok, so they would setup an ISA and a GIA. They would do Bed & ISA next tax year (6th April) to move from the GIA to ISA, which would create a Capital Gain and use your capital gains tax allowance. All that makes sense to do. You can learn all about doing that yourself if you wish.
You are paying them fees so you don't have to learn it yourself.

I would avoid like the plague .

I'd check what he's invested in and the fees

That's disgusting

You don't need an advisor to invest 40k

Read Meaningful Money handbook . Educate yourself in 2 hours and save the money