View more on these topics

James Hay overhauls pricing structure

Alistair-Conway-outdoors-in-2013-700.jpg

James Hay has overhauled its pricing structure across a number of product ranges in a move which favours larger investors.

The firm has increased charges for the lowest investment tiers and reduced fees for the higher band by 0.04 percentages points.

For its Modular iPlan, the firm has amended ts tiered structure with platform charges starting at 0.25 per cent on the first £300,000 investment, compared with 0.18 per cent on the first £500,000 currently.

Charges then reduce in stages to 0.01 per cent on investments over £1.5m, reduced from 0.5 per cent.

Changes to James Hay IPS Managed Portfolio Service will start from 28 April, while for the Modular iPlan changes will take effect from 31 May.

Headline charge for Modular iPlan will reduce from £195 to £175 for investments up to £200,000 and waived completely for investments over £200,000.

The existing £50 fee for contributions and the £50 per cash transfer-in fee will be removed.

Taken altogether, James Hay says the new pricing structure will result in an average annual increase of less than 0.1 per cent.

Additional charges will be applied for Sipps in drawdown and will only be applicable to those customers using capped drawdown. These will increase from £100 to £150. A drawdown closure charge has also been added at £100.

On the additional Sipp charges, the firm says: “This new pricing structure remains in line with James Hay’s guiding principle that only those customers using certain product features and services should pay for them. Those who do not, will not cross-subsidise those who do.”

Currently over 250 adviser firms use James Hay on a regular basis while around 740 firms use it in combination with other platforms, and mainly for its Sipps.

James Hay chief executive Alastair Conway says the new pricing structure will result in a “modest” increase for most customers and are a result of “a bit of correction coming in the market”.

Conway says even after the changes, the firm is still five basis points below the market average.

A James Hay £500,000 portfolio will be charged 0.23 per cent, while the industry average has a charge of 0.3 per cent, according to The Lang Cat.

In November IFG Group, James Hay’s parent firm, said the platform was to review its pricing structure for 2017 as low interest rates were expected to hit its second half revenue this year by more than £1m.

Conway says the platform will continue to invest in its technology but will not go through “a massive replatforming” exercise like others in the market.

He says: “We are focused on getting the basics right and have put service top of the list. It’s important to note these changes have very little impact on our competitive pricing position against our peers. We are still well priced – especially for our core market.”

Source: James Hay

Mixed Portfolio

SIPP – Lang Cat standard tables

Source: The Lang Cat

Recommended

Danger-Stop-Warning-Sign-700x450.jpg
5

James Hay bans non-standard investment purchases through platform

James Hay will no longer allow non-standard investments including overseas commercial property, storage pods and carbon credits to be bought through its platform. The company says it will “continue to fulfil its obligations” with existing non-standard investments. From today, new customers will no longer be able to buy non-standard investments through James Hay’s platform except for in SSASs. […]

Pension - thumbnail

David Cameron appoints former adviser to Tony Blair as new pensions minister

Following a cabinet reshuffle in light of last week’s general election, David Cameron has announced that Ros Altmann will be replacing Steve Webb as pensions minister. As the industry works with one of the largest reforms to the sector in almost a century, the former adviser to Tony Blair has been tasked with ensuring that the pensions revolution does not stray off track.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. South London IFA 15th March 2017 at 2:24 pm

    Nice SIPP they’ve got. Shame about the customer service; i dont know who thought it was acceptable to turn off the phones at 4pm!

  2. The article misses the actuality. The story here is the reduction in interest rates that means James Hay can no longer earn a sufficient margin on cash held with them. They are now imposing a tiered charge for people holding ANY CASH where previously there was no charge. As such, someone holding £300,000 of cash with them will now be charged £750 when previously they would have faced no charge on the cash. This entirely changes the nature of their plan as it is no longer a flat fee SIPP as everyone will hold some cash. Off to find a new SIPP provider………….

  3. How about overhauling it’s customer service offering? The reduction in charges does not go far enough to make up for the poor service they offer.

  4. Ive just had cause to make my 3rd service related complaint in 18 months to JH and we only have 3 schemes with them!

Leave a comment