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St James’s Place is a name that comes up a lot in my conversations with friends, but I’ve heard that their fees are high. What’s your assessment of them?

Answered by Lee Goggin

SJP certainly is popular and is said to account for over a tenth of UK adviser sales at present. Due to the way it has brought a huge army of advisers under its umbrella, clients can usually find an one close to them and many like having a personal, local relationship with someone who has a large investment machine standing behind them.

You’re right to say that questions have been asked about the firm’s fees, however. Since we don’t work with SJP, we don’t have the same level of oversight we have on the 35 plus wealth managers comprising our panel, but the firm is regularly put under the microscope by the press.

In a 2017 ranking, SJP’s full advice charge came out as 2.3%, a third of the way up a peer scale ranging from 1.9% to 3.3%. However, what might give you more pause for thought are the initial fees the firm charges, which it is said could be as much as 5% of your initial investment. The firm also applies an exit fee of up to 6%, falling by 1% annually over the first six years of investing with the firm. The prospect of being effectively “locked in” for this period of time has made many of our users wary and prompted them to look at alternatives.

You might also like to consider that SJP advisers are “restricted”, in that they only recommend in-house investment funds, rather than making truly independent recommendations looking at the whole of the market.

There have also been questions asked about the performance of the firm’s funds. Recent media coverage has focused on the fact that many SJP funds have been underperforming their benchmarks and that outperformance is unlikely to justify the firm’s hefty initial fees. I’d question whether the “you get what you pay for” argument really stacks up if you compare what you could get in performance and value for money elsewhere.

Our guide, What to Expect from Wealth Management Fees will help you make a more informed comparison.

Anonymous, 48, Business Owner | Asked on Dec, 10

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Lee Goggin

Lee Goggin

Co-founder & UK Head

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+44 (0) 207 193 5691

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