When is an exit charge not an exit charge? Over to SJP…

Natalie Holt, journalist with Money Marketing Photo by Michael Walter/Troika

It is fair to say St James’s Place has come in for a bit of a kicking lately. From exit charges, to disclosure, to partner incentives, the SJP business model has been prodded and pulled around and, in some quarters, been found wanting. About time too, some advisers would say.

As David Bellamy announces he will be stepping down as chief executive at the end of this year, Money Marketing has secured an exclusive interview with the man heading up the business many advisers love to hate.

Undoubtedly, there is a lot to rile advisers in what is a wide-ranging discussion. Bellamy comments the firm does not operate exit charges (the preferred terms are “early withdrawal charge” or “deferred advice fee”), that the firm offers value, that it is rich for other advisers to criticise its charging structure. These are all claims that are likely to be met with short shrift.

He says: “I know our charges are clear to clients. I know they like the service they get, and I know performance is good, that is why we keep attracting business. That ought to be clear. Do I get frustrated [about negative press coverage]? Yes I do.”

But increasingly, there has also been some momentum behind trying to have a more balanced debate about a company that has attracted £75bn in assets over a 25-year period.

The pushback is coming from SJP clients, who do not recognise the way the company is being portrayed. Perhaps surprisingly, it is also coming from other advisers (though of course, it is hard to tell just how much of this fightback is emanating from SJP’s own partners).

Looking at the wider advice sector, Bellamy believes advice will increasingly grow in importance and eventually take centre stage for clients unable to make judgement calls on how long their wealth will last, and unable to plan accordingly.

“The pushback is coming from SJP clients, who do not recognise the way the company is being portrayed.”

He is interested in the nuances of intergenerational planning, and using financial planning to solve today’s financial problems of divorce, helping children on the property ladder and navigating a complex tax system. For Bellamy, those with wealth will always gravitate towards a face-to-face advice service over and above an algorithm.

There is a lot of the industry stuff that Bellamy touches upon that I happen to agree with, particularly his positive outlook on advice.

But I still struggle with a 6 per cent exit charge (sorry, “early withdrawal charge”) and an FCA cap of 1 per cent.

Natalie Holt is editor of Money Marketing – follow her on Twitter here