Jones to RJFS --THANKYOU!
It's been several years since I have posted anything in this forum. After recently talking with a 3 year Jones rep, I am once again inspired to come out of 'retirement' and share my thoughts.
I was formerly at Edward Jones, and a top producer there for some time. I went independent with Raymond James and wanted to share some insight. After ten plus years at Jones and six plus years at RJFS (can't believe how time flies), I can say that without a doubt, in virtually every available metric of comparison, being independent is such a better place to be. I'm sure Jones has made a few tweaks over the years. But, my guess is no matter how much makeup you try to put on the ugly girl--she is still...yes...an ugly girl. As I sit in my office, looking back at how my business has evolved from Jones over the last six years, I can tell you this. My production is up about 25% from my final year at Jones--even with a bear market. My take home pay is up dramtically. At jones, living off .25bps trails--lol... and 35% payouts, and here today/gone tomorrow bonuses, and paying for my postage stamps and 1% of my net for advertsing..etc...--just didn't add up. Like most transaction oriented firms, you are like a hamster on wheel. Just running and running--and getting nowhere. You can only increase your revenue by bringing in new clients or by moving around money in existing client's accounts. It was a continual search for available client funds. Now, in comparison. Slightly over half my revenue is fee driven. It's nice to know I can take a week off and not have a measurable decline in production. I enjoy the benefits of having my own safe harbor retirement plan. I enjoy the benefits of being my own boss and managing my business efiiciently. RJFS is not a perfect firm--far from it. It's just a much better firm than Edward Jones. In fact, being independent is probably the best business decision I have ever made. So--to those of you who spoke with me while I was at Jones "bleeding green" and drinking the proverbial kool-aid. I just wanted to put it out there and say Thank you. Thank you for helping me do the right thing for myself, my clients, and my business. It's made a big difference in my life. Cheers and Happy Early Thanksgiving! ZACKORight on my brother!
Spiff-
You probably weren't around when Zacko started on these forums. Now here is an example of Jones rep who can quantify why its so much better being indy. Can't wait to hear your company response... Zacko- my former monicker was footsoldier. It's nice to hear from you again. We actually talked on the phone a couple of times and all is very well on our end as well.uwec - you rear your ugly head for that?
zacko - What, were you bored today? Congrats on your success at RJ. foot - what would I need to give him a company response about? I happy that he's happy. I don't personally agree that Raymond James is a better firm than EDJ. I do believe that he feels it is a better firm for him. To each his own.Spif…I only posted so I could get emails on the thread but thanks for your comment.
Space, Have you worked at RJFS or just Jones?
Spif…I only posted so I could get emails on the thread but thanks for your comment.
wis-eau claire?
Yes…Eau Claire…1986 grad…Go Bluegolds!
Zack-
A point I have been making for eons is that Spiff only knows Jones. Has nothing else to compare and believes beyond any reasonable doubt that Jones is the best. Spiff- Fairly accurate assessment?[quote=BigCheese]Zack-
A point I have been making for eons is that Spiff only knows Jones. Has nothing else to compare and believes beyond any reasonable doubt that Jones is the best. Spiff- Fairly accurate assessment?[/quote] Not that I need to speak for Spiff or anyone else for that matter...but I believe he has said over and over "he believes beyond any doubt that Jones is the best ....FOR HIM!"Yes…Eau Claire…1986 grad…Go Bluegolds!
Eau Claire freshman 1976
(dorm was 1078 Towers)
I cant remember my phone number, why do i remember that?
finished Madison
seems like it was 1576 now
HKA-
I have to wonder how anyone could contend that the firm they work for is the only for him, if they have nothing to compare. Seems fairly obvious to me and probably others that its virutally impossible to be impartial with such a limited view of the overall marketplace.How many sales pitches from how many brokerage firms does one need to hear to make an assumption of contentment? If you are going to base one’s ability to make a judgement based solely on first hand experience, then only the most seasoned journeyman with possibly a dozen firms behind him could make an “accurate” decision.
[quote=BigCheese]HKA-
I have to wonder how anyone could contend that the firm they work for is the only for him, if they have nothing to compare. Seems fairly obvious to me and probably others that its virutally impossible to be impartial with such a limited view of the overall marketplace.[/quote] I'll give you an example...I have been in the business world for many years now, however, this industry is fairly new to me ( a few years in)...I know that at this point in my career, after doing extensive research...that Jones is a great place to work, particularly for a new FA...this model (EDJ)...suits a new advisor as well as a mega producer (IMHO). However, I do believe it punishes the middle of the road guy, as you can be making 50k/trimester (profit) and only get a piddly bonus...the bonus kicks up after a certain number (not sure what that is yet). Now, that being said...I know that when my assets/production hit a certain point...I will certainly look at my options at that time and consider Indy...however, at this time, Jones is certainly the best firm FOR ME. Now...i'm not saying that I'm correct, however, if it is truly how I feel it is good enough right now. Of course, for some people, believe it or not, the culture of our firm, trumps the money issue....I am not one of those people. So if Spiff, or anyone else says that it is best for them...I believe them....What if someone said, Cheese, you never worked for a wire...or a bank...so if I say that would be best for you, you couldn't deny it......IMO that's silly...Indy is the best for you because that is what your experience/heart tells you. So all i'm saying is that whatever someone thinks is best for them at that time....is....whether technically there is something out there that may make you more money...or give you more products etc...see what i'm saying here??The firm you work for means something but, let me ask you this, what have you gotten in this business that you DIDNT get on your own?
no manager or firm has ever REALLY made a difference for my career. The BEST you can expect is that they dont screw anything up.
[quote=BigCheese]Zack-
A point I have been making for eons is that Spiff only knows Jones. Has nothing else to compare and believes beyond any reasonable doubt that Jones is the best. Spiff- Fairly accurate assessment?[/quote] Accurate assessment that I have worked only worked for Jones in this career. I do believe that Jones is a wonderful company and beyond a reasonable doubt the best company for me. For you and countless others, there are other best companies.HKA-
Until you have worked for another firm, its all conjecture. You hope, assume, pray, I don't care what you want to call it, that the firm you are with is the best for you. If you couch it at the time, I can understand and even appreciate your point. What I have been trying to get across for a long time is that when you have stepped outside the Jones culture/company, it is then that you can be impartial. You can truly assess whether the firm is appropriate for you long term. Hearing from a former top producer at Jones and now out 6 years with Ray Jay is giving a perspective that all of you ought to at the very least take into consideration. In 1997 when I was hired by Jones I truly felt it was the last firm for me. 9 years later I left. It wasn't instantaneous, but over time I realized it wasn't the firm that I could see myelf retiring from. And now looking back after 3 complete years since, I am reminded with messages like Zacko earlier, that the path that I took like many others, was the best for me. Again I will say this about Jones. A great place to learn the business.Wow Zacko, glad to see you back. You were a strong inspiration that pushed me over the edge to RJ (while I operated under a different handle). Everything you told me would happen has come true. Due to the decline and some short term expenses, my personal bottom line is only slightly better than it would have been at Jones, but my peace of mind has skyrocketed.
Beyond that, the upside is swinging in my favor and I am about to get back into that 45-65% net net range before long.
The thing about all of this Jones/Indy banter is that once you go Indy, outside of these forums you rarely look back. The forums give us an opportunity to express in writing how much better it actually can be than at Jones, and that is only understandable after you’ve left.
Zacko you are a better man than me for having the discipline to leave this forum as long as you did. It is an addiction for me, even though the content has gotten very immature over the last two years. Seeing an old familiar name brings back a level of sophistication to this place.
Zacko, i don’t recall seeing you on the boards back then, i have been on and off the boards for more than three years.
But your post was great. Maybe you can stick around and add some INTELLIGENT content to the forum, which lately has been overshadowed by nonsense. I joined RJFS 6 months ago and am extremely happy. But its a short time to make a judgement, so it was encouraging to read your post. No doubt for ME, the Indy model is the right model. It gives me control and allows me to live my life my way.It’s good to see an old familiar broker like Zacko…I don’t post often here anymore because the forums have deteriorated into a high school environment…“stop talking about me or I will out you”. But I enjoyed your wizdom over the years & hope to see more of you around. Like you I joined RJFS (2006) & have never looked back. Its’ the best move I ever made.
Agreed indy is not for everyone, I still have friends that require the "incubation" chamber that is Jones & they have no desire to want to leave the womb..so be it, to them they have it all & maybe in their world they do.[quote=BigCheese]
HKA-
Until you have worked for another firm, its all conjecture. You hope, assume, pray, I don't care what you want to call it, that the firm you are with is the best for you. If you couch it at the time, I can understand and even appreciate your point. What I have been trying to get across for a long time is that when you have stepped outside the Jones culture/company, it is then that you can be impartial. You can truly assess whether the firm is appropriate for you long term. Hearing from a former top producer at Jones and now out 6 years with Ray Jay is giving a perspective that all of you ought to at the very least take into consideration. In 1997 when I was hired by Jones I truly felt it was the last firm for me. 9 years later I left. It wasn't instantaneous, but over time I realized it wasn't the firm that I could see myelf retiring from. And now looking back after 3 complete years since, I am reminded with messages like Zacko earlier, that the path that I took like many others, was the best for me. Again I will say this about Jones. A great place to learn the business.[/quote] "when you have stepped outside the Jones culture/company, it is then that you can be impartial." Please sell me on how this makes you impartial. A new and additional perspective I will buy. Impartial? I think you are selling your usual bucket of crap. I am not buying any but you might be able to sell some of it here.welcome back my brother…
[quote=BigCheese] HKA-
I have to wonder how anyone could contend that the firm they work for is the only for him, if they have nothing to compare. Seems fairly obvious to me and probably others that its virutally impossible to be impartial with such a limited view of the overall marketplace.[/quote]
Cheese, do you believe in god? I hope not, because you couldn’t possibly believe that god is the best thing for you, unless you’ve been a satanist.
Thank you for the kind words and it's nice to see a few familiar "faces" as well. It also seems the more things change, the more they stay the same...or something like that. I don't know how long I will stay--but I will share the following.
In retrospect, I really have no ill feelings towards Jones. I probably SHOULD for the way they take advantage of the uneducated financial advisor, and pretend to be something that they are indeed far from. Underneath the cultism of my decade long career at Jones I was provided some fine training, and in some ways I am appreciative of the time I spent there. I made some friends, many of whom are now indy, that I still stay in touch with today. Jones was very well paid for reveune I was able to generate. Over my career, when you throw in revenue sharing, years with little or no bonus (I was doing between 650-750k at the time) and the office overhead I was sharing in the cost of--Jones took home close to 50% more money that I did. That's not close to being fair. I had heard of a few friends going independent, but naturally I was skeptical at first. My skeptisim proved to be totally unfounded. In fact, the debate of Jones vs Indy should have died a long time ago. There should be no argument from anyone (except a newish IR--oh wait you are called FA's now)((just like RJFS)) that Jones is better. Now, if your a two or three year FA with 15 million or even 20 million under management, there is no financial advantage to leaving. At 30 million and up, the financial advantage really starts to show. Quite frankly it's simple math that anyone on this board can do. So beyond payout--what else is there? Payout is more than enough for many of us...but look past it for just a moment. What about technology? Research? Many more products? A true ability to manage a fee based practice? Owning your own business with a sucession plan? Has Jones addressed this? Being truly independent with no requirement to attend meetings or expectations to train your competition? Tax advantages? They are H U G E. Too many to name. And don't tell me "paybills" or some equivalent is just as good. It's not even close. How many of you at Jones are paying AMT? Funny that RJFS started deferred comp a year or two ago. RJFS put more in my deferred comp than Jones did in my profit sharing..lol. As a top producer, I also get trips. And while they are better than the Jones trips with no mandatory meeting--I do also have to pay taxes on them. Call that a wash and I think I'm being generous. I honestly think most Jones FA's (still want to say IR's) are smart people. I think they fall into two camps. Camp 1: The fearful. They know it's "probably" better but they are comfortable and afraid of making the jump. Maybe a point in time will come when they get pissed off at something that happens at Jones, then will they do it. But for the most part, fear holds them back. Camp 2: The kool aid chugger. Ya you know the type. They are smart, organized, and do whatever Jones tells them as they believe it to be absolute gospel. They feel they owe Jones for the fantastic opportunity they have been given. They refuse to believe the fact that you make more money as an indy. They think everything at Jones is the best, yet they have no other benchmark whatsoever to compare it to. There you have it! ZACKORight on brother (that was for Spiff)!
The ball roller lives!
Y-
Check out item 2 of Zacko's comments. That's impartiality talking. Someone who has done it much longer than you, Spiff, B24 et.al., and gone somewhere else. I know best firm for you now, I get it (how was the B pretty nice wasn't I)...Which one is item 2? Are you talking about the research comment or the compensation comment?
Just FYI - you can't claim impartiality if you are on one of the sides being discussed. You can't say that Zacko is impartially arguing that RJFS is better than Jones. That's like playing a basketball game and letting a player from off the bench of one of the teams be the referee. So, stop saying he's impartial. You just don't sound all that smart when you say it.
Camp 2: The kool aid chugger. Ya you know the type. They are smart, organized, and do whatever Jones tells them as they believe it to be absolute gospel. They feel they owe Jones for the fantastic opportunity they have been given. They refuse to believe the fact that you make more money as an indy. They think everything at Jones is the best, yet they have no other benchmark whatsoever to compare it to.
Zacko may be able to say this better than I.Zacks-
Your question about AMT isn't on their radar yet. After several years (I will generalize) most are barely north of 100K gross and they are relatively new in the biz. Now before Spiff goes off on me again, I don't know his biz and I don't know him, and I know he doesn't see any relevance to time in the business, or production so don 't pigeon-hole him. He also spends times on these forums during business hours because he doesn't want to interfere with his family time. He rewards himself with ties and an occassional ice cream with the family when he hits his bogey. He learned that from old sage wise man who are now GP's and once upon a time walked five miles uphill in snow shoes when they started at Jones.I am trying to be impartial as I have spent considerable time at both firms. And, while I share my opinions–they are generally backed by facts and personal experiences. I’m not saying Jones is a bad firm. They do offer amazing rookie training and a script for success. If you follow what they tell you to do and you work hard, you will become at least a semi-succesful financial advisor.
The fact remains that down the road.... Jones offers less and less. They undercompensate successful financial advisors, ask them to mentor their competition, and meanwhile the GP's reap the reward and the balance of the profit goes to offset the cost of training new FA's. It's great for the brand new rep. It's a $hit deal for a mid to larger producer. RJFS is a well run firm. I own the stock. That's the extent of how much I care of what goes on here. I run my office, pay my staff, do my job as well as I can--and then I go home. It's a simple platform. My question is why be paid less to do the same work? Why on earth would you place you and your family in a position where you DON"T OWN the business you have worked so damn hard to build? The list goes on and on.... Again: There is Camp 1 And: There is Camp 2 Kool aid will be served at both camps and there is plenty to go around... so enjoy :)[quote=BigCheese]Zacks-
Your question about AMT isn't on their radar yet (wrong). After several years (I will generalize) most are barely north of 100K gross (wrong) and they are relatively new in the biz. Now before Spiff goes off on me again, I don't know his biz and I don't know him (true - you only act like you do), and I know he doesn't see any relevance to time in the business, or production (wrong) so don 't pigeon-hole him. He also spends times on these forums during business hours because he doesn't want to interfere with his family time (true). He rewards himself with ties (wrong - I've never bought a tie for myself because I called a prospect or two) and an occassional ice cream with the family when he hits his bogey (wrong again). He learned that from old sage wise man who are now GP's and once upon a time walked five miles uphill in snow shoes when they started at Jones (true - I did hear it from Steve Seifert and Jack Cahill. Both top producers, both GPs. But they've never been with a firm besides Jones, so they don't know what they're talking about). [/quote]Spiff are you suggesting that AMT for you is around the corner. Congrats I stand corrected. Oh wait a minute you just said I was wrong not that you actually are concerned about it.
I have to side with Zack. It's either 1 or 2. The fact remains that down the road.... Jones offers less and less. They undercompensate successful financial advisors, ask them to mentor their competition, and meanwhile the GP's reap the reward and the balance of the profit goes to offset the cost of training new FA's. It's great for the brand new rep. It's a $hit deal for a mid to larger producer. Come on Spiff- Let's hear your response to someone who has been there and done it vs someone who hopes to get there...Zacko,
Much of what you say is true, although you have no clue as to what has gone on technologically at Jones over the last several years. I think you would be surprised/impressed how we have burst into the 1990's.....joking aside, I believe we now have formidable technology! I also think that, as Spiff said, being that you are with RJ now, it is impossible for you to be unbias toward who you feel is the best. This entire thread has been about semantics....nobody can tell me what is best for ME...I don't think i've heard a Jonesie or anyone else on this site ever say that Indy Reps don't make more Net than Jones or Wires. Oh yeah...this thread has also managed to make Cheese almost civil and he is now adding value to almost every discussion....you coming back to the boards seems to be the same...although our opinions differ some, having these types of debates can really help....seems it helped you to make your decision to go Indy back in the day!?[quote=zacko]I am trying to be impartial as I have spent considerable time at both firms. And, while I share my opinions–they are generally backed by facts and personal experiences. I’m not saying Jones is a bad firm. They do offer amazing rookie training and a script for success. If you follow what they tell you to do and you work hard, you will become at least a semi-succesful financial advisor.
The fact remains that down the road.... Jones offers less and less. They undercompensate successful financial advisors, ask them to mentor their competition, and meanwhile the GP's reap the reward and the balance of the profit goes to offset the cost of training new FA's. It's great for the brand new rep. It's a $hit deal for a mid to larger producer. RJFS is a well run firm. I own the stock. That's the extent of how much I care of what goes on here. I run my office, pay my staff, do my job as well as I can--and then I go home. It's a simple platform. My question is why be paid less to do the same work? Why on earth would you place you and your family in a position where you DON"T OWN the business you have worked so damn hard to build? The list goes on and on.... Again: There is Camp 1 And: There is Camp 2 Kool aid will be served at both camps and there is plenty to go around... so enjoy :)[/quote] Zacko, It is good to see you alive and well and posting. You helped me to see things from a different perspective so I owe you a thank you. I left Jones about a year and a half ago to go independent. I talk occasionally to brethren that are at Jones and it is always with a little bit of fondness that I remember the Saturday meetings when I started. Would I go back to Jones, no. Am I thankful for the time I spent there, yes. I find it easier on a multitude of levels to accomplish what I need to for clients without encountering tradeoffs that stand between the client and myself now being independent. Thanks again.[quote=BigCheese]Spiff are you suggesting that AMT for you is around the corner. Congrats I stand corrected. Oh wait a minute you just said I was wrong not that you actually are concerned about it.
I have to side with Zack. It's either 1 or 2. The fact remains that down the road.... Jones offers less and less. They undercompensate successful financial advisors, ask them to mentor their competition, and meanwhile the GP's reap the reward and the balance of the profit goes to offset the cost of training new FA's. It's great for the brand new rep. It's a $hit deal for a mid to larger producer. Come on Spiff- Let's hear your response to someone who has been there and done it vs someone who hopes to get there... [/quote] AMT - yes, it's one of those. How do you figure that they undercompensate me? If I had the exact same duties as an indy, but got paid like I do, you might have a point. But if I worked for Morgan or Merrill/BAC or as an employee with RJ I'd get paid relatively the same way so how can you tell me that I'm undercompensated? It's an apples to oranges conversation. Indy's have a better payout. Period. There isn't anyone in the industry with a brain that doesn't know and understand that. Again, you as an indy rep take more risk and have more responsibilities. For that you should be compensated more. Jones pays me what they said they were going to pay me. Nothing more, nothing less. It's not really a question of one being better than the other. They're simply different.So basically if I understand you correctly you are asserting that I am just wrong. You apparently can’t admit that you are even close to AMT. It’s just important for you to dismiss any comments that don’t support your position.
You are so ready to be a GP. I hope they are reading these forums. (Sorry HKA)What comments don’t support my position? Whether I am close to AMT or not is pretty irrelevant to this discussion.
I'm not dismissing your comments. I'm saying that you're arguing the point incorrectly. To put it in your terms, the owner of the company gets paid more than the employees. You, as an indy rep with LPL or RJ or Commonwealth or whatever affiliation you choose, are the owner of your firm and therefore are compensated for the risk you take by owning the firm. If I read the RJ website correctly you are responsible for your own benefits, staff, their benefits, your own retirement plan, your own compliance, your own systems, etc. I, as an employee of EDJ, am not taking the risk of being the owner and therefore am not compensated in the same way you are. You have more risk than I do. So do you get paid more than me? Yes. I'm not sure what else you want me to say.They undercompensate successful financial advisors, ask them to mentor their competition, and meanwhile the GP’s reap the reward and the balance of the profit goes to offset the cost of training new FA’s. It’s great for the brand new rep. It’s a $hit deal for a mid to larger producer
Spiff- These are Zacks comments. When you are above 200K Zacks words would start to make sense to you. WHEN you are facing AMT, I think its around 125K net you will be scratching your head what to do to keep your hard earned dollars. I think its fairly clear you aren't grasping the comments. Mine or Zacks. The total picture is quite different once you are at least Seg 4. Re-read Zacks comments previously, its not just compensation. Anyone else care to help Spiff through this? We seem to have hit critical mass...Oh Great, here we go again…I’ll bite, as usual…
Interesting thing about RayJay, many of their brokers work from home or out of a bank. I've got 3 RayJay bank brokers working for chop-shop local banks in my town. Been smeared by the whole Dennis Hurkula scandal as well. Funny how cuts in annuity payouts have pissed off their brokers. Why is it the median production at RayJay 100k?, lots of poor producers bring down the median....and I've brought over a ton of RayJay accounts so I know the quality of advice I'm seeing. On the RIA side, how about both sides of FICA? Affiliation fees? ticket charges? paying for assistant and her health care? Under 400k production it doesn't make sense. Over 400k, it makes great fiscal sense. The grass is always greener on the other side. Funny how every independent advisor is always hitting the ball out of the park. All I hear is, "I can't believe I didn't make the change earlier", or "My business has grown so much since I went independent", or "I can make so much commission on private reits, leasing contracts, and other non-coorelated assets, so I work half as much". Interesting thing though, is with most independents, their production is a joke. Why do you think the median gross at RayJay & LPL is around 100k? Why is it the last guy who was "balling out of control" when he went indy (RayJay) in my region ended up working for his dad in private real estate development (Oops!)? Another guy in a town near mine ended up working at LPL out of his home, his parents stopped my office and said they were excited because their son just picked up a used 1998 Lexus, his first "new" car in a decade. I know people like Zacho can buck the trend, but most don't. My buddy has his Jones office in another state. An independent broker that works in the same office complex keeps trying to get him to move, RayJay if I'm not mistaken. My buddy was talking to the indy one day, and told the indy he was averaging around 500k/month in new assets. The indy told him, "that's it, I've been averaging twice that, and I've been doing this almost 20 years." Turns out the guy manages less than 25 million and grosses less than 200k. Seems as though everyone that's indy has something to prove, I don't really get it.That being said, if I ever got pissed, I'd be at LPL or RayJay in a heartbeat.
[quote=iceco1d] Rank,The number you quote for RayJay counts all of their channels. Mind you, they have employee channels where they train newbs with $0 in production, just like EDJ or MER does. For the INDY RayJay model, you can’t join as your own OSJ without something like $250K T12. If you guys notice, most of the “Indy” guys on here, are their own OSJs (whereas, I’m at an Indy office, but I get my supervision from someone else because I don’t have an S24).Now, mind you, I started out fresh in the channel I’m in. $0. No salary. No benefits. I had to pay for all of my testing, licensing, E&O, etc. from the start. Do you think having a guy like me on board lowers the mean and median production at my b/d? I bet it does. Guys like me aren’t on here talking about “Whoa, the difference is sick!” The guys on here talking about being Indy vs somewhere else, have actually been somewhere else. In any case…I know you (rank) post a lot about Indy guys “working out of their car” - but seriously? You have some wierdos in your area I think. But of course, ALL of those people have to be Indy…where else can they go? certainly not MER. EDJ isn’t going to build out an office for a guy that wants to work 10 hours a week. And even still…how about that? Isn’t it refreshing to know that these control their own destiny to such a degree that if they basically want to work 1 day per week, they can make that call? If they don’t want to have an office. If they want to manage $14MM from home, and net $100K a year to work 10 hours a week, they are freet to do so. On the other side…what’s this discussion of AMT? Foot, can you quantify exactly the reasons you personally would be on the hook for AMT? I’m not saying that you don’t actually pay it…I’m saying, that it’s my understanding that it’s not simply related to your income, and you’re making it out as if that’s the case…
[/quote]
you in no way control your destiny. your firm will slash your payout at the first chance they get. they will change the rules.you are srcewed.ban my ip good luck it’s not gonna happen. you are a twenty eight loser. get a life
A few facts:
Breakeven (in other words netting a 40% “payout”) happens for me at about 16k-17k gross/mo. Annualized that’s 200k/yr. Not sure where the 400k calculation comes from. Above assumes about $6,000/mo overhead, which will vary.
My portfolios look very similar to what they did at Jones except I receive an advisory fee now and can use some satellite funds or products where appropriate without the need to justify why I’m not hitting a breakpoint.
RJFS does compliance, unless you are an RIA. I think many here with RJFS have RJ do their compliance. It is similar to Jones standards, in some caces easier, in some caces more difficult.
AMT is calculated when someone has wage income and high deductions. A business owner nets his or her expenses from gross revenue for a net revenue figure, which then becomes his or her wage income for tax purposes. This is why a Jones employee has far more potential to hit AMT.
RJ does not allow branches to run from a home location. It’s their mandate.
Do not confuse RJA (described above-employee division) with RJFS.
Rank, in defense of the indy numbers, there are a lot of indy “producers” that are really just licensed assistants, CPA’s, attorneys, insurance agents, etc where brokering securities is not their only or primary revenue source. So using the “average” production numbers is not really relevant in the indy world. Just like the RIA world. There are lots of RIA’s out there that generate very little in AUM fees, but derive revenue from other sources (this again is typical with attorneys). Because if you are going to throw the “average” numbers out there, you have to throw in American Funds, PIMCO, First Eagle, Fidelity, etc. into the mix. They are, after all, RIA’s.
To be honest, I think the "working out of their garage" thing is also overblown. Yes, the indy channel is home to many lowly producers. Guys that would have been fired at any captive firm they were at. They are holding on simply because they can meet the indy minimum at their current firm. And I don't think production should be the benchmark. I have one friend in particular that is an RIA. He does about 250K in production, has about 40 clients. Has a very nice (small) office in a nice part of town. It's much more attractive than many of the Jones "Subway shop" offices I see. No assistant (doesn't need one). He nets just over 200K. That's after everything other than personal income taxes. He works maybe 25-30 hours per week just managing money. Loves his job, loves his life. Doesn't take any new clients under 500K. So he's a small, indy producer, netting about as much as a 450-500K producer at Jones, with a MUCH easier lifestyle and work life. I'm just not sure how that qualifies as a bad thing. Just saying. On the other hand, my regional leader grosses about 450-500K, has over 1,000 households and about 85mm AUM. Took him 10 years to get to that (he just started as RL). You know how much work that took to get there? I know you do. Most people just don't want to work that hard for that long. And then you have to manage 1000 households. Our former RL has about 1500 housholds and 175mm AUM. The guy grosses about 850K (plus lots of SLP and LP). 18 years in. Won't even take a day off to go golfing. Too much to do. Too many calls to make. Works about 45 hours a week. He's a "stockbroker". But he makes a lot of money. If I laid out all these scenarios in front of someone, which one do you think they would pick? Just saying. I'm not sure how many successful indy advisors you know, but a I know several, and I would consider them all successful in many ways.I can't speak for Ray Jay, but as an LPL rep, they have 12K reps and gross roughly half of Jones reveunes. I think LPL had revenues of 2.5B last year. To be your own OSJ you have to have at least 125K gross...not very much. Half as much as Ray Jay. So it wouldn't suprise me if 30-40% of the reps were less than 125K.
My hat's off to guys like Rank who have done it themselves (I believe that to be the case). B24's point should be reitereated. Which is better? A rep who grosses 500K and NETS 200K vs. a rep who grosses 300K and NETS 200K. I realized long ago, for me, scenario 2 was the right option. By the way these are my numbers. I work out of an office, have two part-time assistants and work about 35 hours a week now. I have 161 households and closing in on 40M. I contribute 65K (my wife and I) a year to a retirement plan and have tremendous tax advantages since I left Jones. Speaking of taxes. This is an item that is overlooked when comparing employee vs self employed. AMT, thankfully, was defined by Luv. I am not an accountant. Suffice to say that AMT originally was designed to tax the wealthy. My understanding is that AMT is an alternative method of calculating tax not additional. The rub is that the thresholds have dropped and it is now affecting middle income earners. I know of several reps that left Jones because they couldn't get around AMT and were paying much more than ordinary income tax. Maybe RANK could share with us his experience. As Spiff is so quick to remind us, neither is better just different. Zacko,Luv, myself would more than likely contend that life is better as an independent for a variety of reasons highlighted many times preivously.Rank, no disrespect, because you are a smart guy and your many posts prove that. But in this case, you are talking out of your arse and need to check the facts.
RJA has 5500 brokers, of which a grand total of 500 work in banks. 1000 are employees and the rest are RJFS (Indie). The average RJFS advisor grosses $270k as of last months T-12 (or close to that, i dont remember the number). They require you as Ice Stated to be at 250k in order to be your own OSJ. If you fall below 240, you are charged a monthly "maintenance fee" which effectively forces you to ramp it up or move into the office of another OSJ. Dont know where you are, but in the NY area I've looked at a lot of FA's set up with RJ before i came over, and none of them work from home. As far as indy vs wire, i dont really want to get into that, because its old and has been beaten to death on this forum. But i'll just say two things. 1. I am clearly making more money as an Indie, even with employer FICA, in addition to having more control over my own tax situation. 2. Even if i was making the same money, or less, the lifestyle change is huge. People actually comment on how much more relaxed i seem to be. To the poster who stated that RJFS can cut our payout in a heartbeat and we have no control, they are much smarter than that. With 75% of their brokers being Indie, with a contract that says they own their book, trust me, it aint gonna happen. Lastly, i have to say, RJFS support is tremendous in every area, from product, to financial planning, to practice management. I have everything i had at the wire, except for the people who knew nothing about the business being up my ass to sell checking accounts and mortgages.Zacko, welcome back. I’ve enjoyed your posts in the past and respect the move you’ve made to be independent. My experience leaving a bank program to go independent has many of the same elements your move did (although on a “slightly” smaller scale). IRRC, at one point in your posting history here, you mentioned some elective surgery for your wife…I trust that all went well….
At any rate, thanks for all of the informative and yes, often entertaining posts. We'd be glad to see you back more often, but I understand that time here is not time spent making money and taking care of your clients...which is why I post much less than I used to.I’m having some fund at a few Indy’s expense. Had a couple c***tails last night. If you saw my last sentence, I will be moving to RayJay or LPL the minute I don’t feel like Jones if the right place for me. Right now I am very comfortable, enjoy my aquaintences at Jones, and feel like Weddle is guiding the firm in the right dications. Independent has it’s benefits, and I remember Zacko talking about his transition a few years back. Zacho is a great resource, and I respect his posts, as I feel he is very objective. If I ever move, I might even try and get ahold of him for some advice…but for now I’m very happy.
I think you meant to say “guiding the firm in the right direction”, not “dictations”
Are you sure those c***tails were last night and not tonight?> LOLThat is not entirely accurate...Jones takes 75 to 125 bps from your VA commission before you even see it. When I was there I signed up for 40% not 40% after they take a slice first. Just another EJ half truth. Why is EJ keeping 95% of the revenue sharing dollars and not the brokers? Shouldn't you get 40% of that too, bonus bracket or no bonus bracket? The fact is: I'd rather be at EJ than another wirehouse because of the one-man office thing but NOTHING compares to Indy. The increased risk you talk about is NOTHING compared to the benefits...it's not even close...not even worth mentioning. The expenses you pay as an Indy are FIXED...the more you make the more you keep...the exact same reason any W2 broker is leave and be 1099. It's not 10 - 15% better is 30 - 40% better net. You're doing the exact same job, why work harder and give those dollars to the GP's or the stockholders? Be your own stockholder! We haven't even talked about the ability to sell your book...can any W2 broker do that? If you die, does EJ give your family a check valued at what your business is worth or do they just ask for the key to the office? Spiff, this is about math...do some! If you think it's about work environment...are you suggesting that working for yourself would be worse? I know my boss is an a$$hole but that just me...no really...it is me.Jones pays me what they said they were going to pay me. Nothing more, nothing less.
[quote=Spaceman Spiff] If I read the RJ website correctly you are responsible for your own benefits, staff, their benefits, your own retirement plan, your own compliance, your own systems, etc. I, as an employee of EDJ, am not taking the risk of being the owner and therefore am not compensated in the same way you are. You have more risk than I do. So do you get paid more than me? Yes. I’m not sure what else you want me to say.
[/quote] RJ or any BD that an Indy uses does the compliance, not the broker. The biggest risk ALL brokers have is centered around client complaints...PERIOD. I have none but clients can twist thing around and even an honest guy doing a great job can get caught up in a complaint. Do you have E&O with EJ...NOOOOO. Does EJ protect you or EJ....EJ!!!!! They will trash the broker to protect the firm (all firms will do that) in a heart beat...EJ is not out there protecting you. If you need an attorney to represent you...who pays...NOT EJ...you do...just like an Indy. The risk you talk about for Indy's is too small to mention. If you do a good business and plan to be around, the cost and time to run an office is CHEAP compared to giving away 60%+ to EJ (and you still pay some office costs too with EJ)[quote=uwec1986][quote=Spaceman Spiff] If I read the RJ website correctly you are responsible for your own benefits, staff, their benefits, your own retirement plan, your own compliance, your own systems, etc. I, as an employee of EDJ, am not taking the risk of being the owner and therefore am not compensated in the same way you are. You have more risk than I do. So do you get paid more than me? Yes. I’m not sure what else you want me to say.
[/quote] RJ or any BD that an Indy uses does the compliance, not the broker. The biggest risk ALL brokers have is centered around client complaints...PERIOD. I have none but clients can twist thing around and even an honest guy doing a great job can get caught up in a complaint. Do you have E&O with EJ...NOOOOO. Does EJ protect you or EJ....EJ!!!!! They will trash the broker to protect the firm (all firms will do that) in a heart beat...EJ is not out there protecting you. If you need an attorney to represent you...who pays...NOT EJ...you do...just like an Indy. The risk you talk about for Indy's is too small to mention. If you do a good business and plan to be around, the cost and time to run an office is CHEAP compared to giving away 60%+ to EJ (and you still pay some office costs too with EJ)[/quote] You have none what? Clients or complaints? You are correct. Jones will cover themselves first, the FA second. As an employee of Jones, they are on the hook for a much bigger dollar amount that I am. I certainly wouldn't expect them to provide a defense attorney for me if I decided to start doing something illegal. But, they will provide me with legal assistance if EDJ, by way of my office, is named in a suit or subpoenaed. Had buddy in town who got a letter from the court because a former client had stolen a bunch of money from his mom and dad's trust accounts. Jones did their internal investigation and figured out that my buddy hadn't done anything illegal, so they hired a big fancy attorney to assist him with the case. It was a mess, but he's not out of pocket a single dime. This is what the RJ website says if you are an IC - "As a branch manager, you'll be responsible for ensuring compliance with oversight and support from our sales management and internal compliance teams, so take steps to make sure this important area gets teh attention it deserves." LPL makes it sound like they have some people that will give you assitance and guidance, but essentially you are on your own. At least that's what their recruiting website makes it sound like. If that's not the case, then some of you folks need to tell them to rewrite that part of their recruiting page. Compliance issues are only one small part of the pie. You guys have a lot of your own capital on the line. Some more than others no doubt. Like B24's friend it might only be capital for leasing space, buying computers, and software to do what he wants to do. For others it's assistants, benefits, other FAs, etc. You get a higher payout so that LPL doesn't have to worry about having a group of people that do nothing but make sure that your office is ready to go when you walk in. I get it. If you can keep more that higher payout, then you're all the better for it. I'm not trying to argue that the independant model is better or worse than EDJ. I know you might like to think that I am. What I'm saying is that it's just simply a different business model. It works for you. Jones works for me. It's pretty simple.[quote=uwec1986] Yes…Eau Claire…1986 grad…Go Bluegolds![/quote]
Eau Claire freshman 1976
(dorm was 1078 Towers)
I cant remember my phone number, why do i remember that?
finished Madison
seems like it was 1576 now
1983 UWEC Grad. I don’t think I had a dorm room…lived on Water Street. I can still remember those freakin cold days crossing the bridge.
Spiff,
You're right...I have no clients...if that was a serious comment... you're a dumba$$. Try not acting like a 2 year old. I'm try to help you...because you need it. All my trades are reviewed by compliance just like EJ...there really isn't any dif. (the rules may be dif. but very close) I'm not on the hook any more than you are if a complaint is filed...it's exactly the same risk. EJ paid for your buddy's attny because they didn't want EJ's name tarnished so they were looking out for the firm and NOT your buddy...I really hope you aren't that dull as to not see that. The capital to start an Indy office can be as low as $3k to $5k...without an assistant. I'll be happy to email you a spreadsheet so you can plug in your own numbers and you'll see exactly what the dif. is. You do the same job I do, you really don't need any help from EJ at this point and you get paid way less...why would you defend that system. EJ is a great place to start but there is NO reason to not go Indy after 3 years. Risk is not a factor...your biggest risk is your clients and as I said above and it's EXACTLY the same risk. I have not a dollar more in exposure than you. Renting office space these days is very cheap...check it out...start up cost should not be an issue. After the first 4 - 6 weeks of moving your clients, you are doing the same thing you did before at EJ with a much higher payout and EXACTLY the same risk. You'll make up your startup cost in one month. You need to put in more time thinking before you spout the Kool-aid line. Going Indy from EJ is a much easier process than going from MS or ML because you already work alone. Do you have any comments about how EJ gets a big chunk of your VA commission before you see it? Why don't you get 40% of the rev. sharing dollars...you did the work...not EJ?I lived next to the Holiday gas station on Water and later on Main St. I did everything I could to avoid that bridge...got a lot of parking tickets back then. Even fought one in court and won!1983 UWEC Grad. I don’t think I had a dorm room…lived on Water Street. I can still remember those freakin cold days crossing the bridge.
I've looked for the info on the VA commissions before and I can't seem to find anything that proves you are correct. I have a MetLife A share annuity prospectus on my desk and quickly skimmed through it. The only thing that I can find that would even come close to validating your assertation is a comment that says that MetLife pays up to 7% in commissions, but that some firms choose to lower their upfront commissions and take a trail instead. Since it doesn't break it down any further than that I can only assume that you're going to say "See, I told you Jones keeps a big chunk of commission before you see it. It says so right there." I may be way off base, but I don't believe that's what it says at all. Perhaps you should educate me on where I can find that information other than the prospectus.
As to the revenue sharing dollars...You ask a good question and I don't know that I personally have a defendable position on it. The fact that many offices aren't anywhere near profitable enough to support themselves would lead me to believe that Jones has to come up with money to run the firm somehow. I know that revenue sharing is a major part of the budget and without it, we'd be up a creek. I think that will change drastically over the next 5 years or so with advisory fees going up every month. We'll probably trade one for the other. I fully understand that Jones is covering their butt first in any sort of litigation and that the reason they paid for the attorney is that they have to protect themselves first. So, if I'm with LPL or RJ and my office get's the nice letter telling me that I have to report to Dewey, Cheatem, and Howe's legal office for my deposition on Dec 25 and that I need to supply all account docs from 1990-now immediately, who pays for the attorney? I'm not trying to be a smart aleck, I just don't know. And yes, the client comment was a joke.Thanks for the post Zacko and for your contribution to the forum over the years. We’re glad to have you back.
Spiff,
It is true that EDJ takes at least 2% of a VA, and then pays you your % from the balance. It also happens on at least some Insurance contracts. The best way to validate it is ask a wholsaler who happens to call on independents.[quote=Spaceman Spiff]
I've looked for the info on the VA commissions (see above)...
[/quote] Try to find a VA wholesaler who you have a good relationship with and sees other firms besides Jones...they know. You may be able to get the info out of HQ but you'll be throwing up red flags so I wouldn't advise it. Trust me...it happens...I've seen it brought up in meeting. EJ gets a piece of the pie before you see it...did you sign up for 40% of the pie or 40% of the pie they decide to show you? Have I made up any other details since I left in 2003? NO! Why would I make this up? I'm guessing that EJ keeps about 90 - 95% of those Rev. Sharing dollars for the exact reasons you state...this is wrong...you should get your 40%. Until EJ allowed fee based accounts, there was not much of a way to annuitize your biz...but EJ sure annuitized theirs...that's hypocrisy where I come from. Do you agree with my risk assessment...I have the same risk as you do? Actually...In some ways I have less...EJ can fire you for ANY reason and lock you out of THEIR office. RJ can fire me but has to give me 30 days to move my clients to a new BD (this does not include criminal actions...we'll assume we are both ethical). RJ will not call my clients either. If you have a few too many c***tails at an EJ function and pi$$ off a GP they will have you locked out before you get back to the office and they will fight you for YOUR clients. Please don't tell me this doesn't happen...it does. If a GP wants his kid to take your office...he can. That seems like a lot of risk to me...how about you?[quote=MR.D]Spiff,
It is true that EDJ takes at least 2% of a VA, and then pays you your % from the balance. It also happens on at least some Insurance contracts. The best way to validate it is ask a wholsaler who happens to call on independents.[/quote] It's really not 2% it's more like 75 to 125 bps because EJ FA's still get a trail of 25 bps. With most VA companies if you take the 7% or 7.5% up front, you get not trail...as you know. The bottom line is...EJ get's there's first...I never signed up for that...did you Spiffy?You are correct, I forgot about the trails they get. The most common pay out that I am aware of on the 7 year product is either 7.5% gross or 5.25% with .50% trail. Some differ ,but that is what I am used to getting.
[quote=uwec1986][quote=Spaceman Spiff]
I've looked for the info on the VA commissions (see above)...
[/quote] Try to find a VA wholesaler who you have a good relationship with and sees other firms besides Jones...they know. You may be able to get the info out of HQ but you'll be throwing up red flags so I wouldn't advise it. Trust me...it happens...I've seen it brought up in meeting. EJ gets a piece of the pie before you see it...did you sign up for 40% of the pie or 40% of the pie they decide to show you? Have I made up any other details since I left in 2003? NO! Why would I make this up? I'm guessing that EJ keeps about 90 - 95% of those Rev. Sharing dollars for the exact reasons you state...this is wrong...you should get your 40%. Until EJ allowed fee based accounts, there was not much of a way to annuitize your biz...but EJ sure annuitized theirs...that's hypocrisy where I come from. Do you agree with my risk assessment...I have the same risk as you do? Actually...In some ways I have less...EJ can fire you for ANY reason and lock you out of THEIR office. RJ can fire me but has to give me 30 days to move my clients to a new BD (this does not include criminal actions...we'll assume we are both ethical). RJ will not call my clients either. If you have a few too many c***tails at an EJ function and pi$$ off a GP they will have you locked out before you get back to the office and they will fight you for YOUR clients. Please don't tell me this doesn't happen...it does. If a GP wants his kid to take your office...he can. That seems like a lot of risk to me...how about you?[/quote] You didn't answer my question about who pays for the attorney if your RJ office get's subpoenaed. I don't know of ANY instances where a GP had an FA fired for pissing them off while intoxicated. I especially don't know of any where their kid came in and took over the office. I know of a few who made fools out of themselves at regional meetings and got a phone call from the RL and GP with a very stern warning about not letting it happen again. You can continue to make allegations like that, but I don't think you have any real examples of it happening. Could it happen? I suppose it could. Does it happen, not as far as I know. Of course it could be happening in some other region and I just don't hear about it. Jones GPs don't have the clout to just snap their fingers and make things happen. There's a process to everything here. Surely you were here long enough to know that. You've got to do something sexual harrassment oriented or crossing some sort of ethics line in order to be terminated immediately. That does happen. But David Lane can't just snap his fingers and take my office for his son. I think you'd be really hard pressed to find an instance where it actually happened.Doesn’t EJ shave a little off of bonds before they put them on the green screen?
I heard somethng about that from an EJ guy about a year ago. He may have just been blowing off steam though.Spiffy,
I missed your question about who hires the attny...sorry...I would...just like you would if you wanted one who looks out for you and not the firm. I've heard of rumors of GP's firing FA's on a whim but I really don't know for sure. I do BELIEVE it has happened because the environment there makes it easy. HQ thinks the FA are interchangeable cogs in the Jones wheel so firing one and putting in a rookie does not seem that far fetched to me. N.D., I think RJ takes a piece at the bond desk too so I'm guessing most firms do.I know RJ’s bondesk is pretty transparent (on RJNet), so it should be easy to tell. They definetly have additional compensation on syndicate issues and principle trades - but I don’t think on agent.
The simple facts are that Jones:
(This example is using numbers that I believe to be correct but may not be now) Takes .75 to 1.50 BPS on every annuity contract sold before you get your 40% Let's quantify this number to make it real...... 300,000 producer who does 10% his revenue in VA business. Let's say they were all Hartford Director Contracts and all B shares...... Jones payout 4.75% same contract 40% net Indy payout 6.00% same contract 90% net Placing 500,000 in premium over a year. Jones- 23,750 Gross 9,500 Net Indy- 30,000 Gross 27,000 Net The part that Jones kept before paying you was 6,250. The net on that was 2500 dollars. The difference in the 2 businesses just on VA business is astounding. The net is 9,500 as opposed to 27,000.....The Jones person is giving up 17,500 on the VA business. He never even got a nice card from annuity operations thanking him for his contribution. The bad thing is that on the VA business at Jones you can only do business with the annuity contracts that are approved. At least on the mutual fund business at Jones, you can do business with just about who you want to but the limitation on the VA side eliminates most of the VA world. The same differences apply also to insurance business as well.[quote=uwec1986]Spiffy,
I missed your question about who hires the attny...sorry...I would...just like you would if you wanted one who looks out for you and not the firm. I've heard of rumors of GP's firing FA's on a whim but I really don't know for sure. I do BELIEVE it has happened because the environment there makes it easy. HQ thinks the FA are interchangeable cogs in the Jones wheel so firing one and putting in a rookie does not seem that far fetched to me. N.D., I think RJ takes a piece at the bond desk too so I'm guessing most firms do.[/quote] I agree that if I feel I needed someone to represent me because I feel that I may have done something wrong and therefore need some legal defense, then I'm certainly going to pay for that myself. I wouldn't expect Jones to cover that. But that doesn't answer my question. Let's say tomorrow you get served papers on an account which you know for a fact you haven't done anything either unethical or illegal with and you are confident you don't need a lawyer to represent you personally. And LPL agrees with you. Who gathers the requested paperwork? Who preps you for the deposition? Who pays for the attorney? I know you said you haven't had any complaints yet. Neither did my buddy until one walked into his office and handed him the court papers. You never know when it could happen. It's one small little thing, but I know for a fact that Jones will cover those bills and do that paperwork gathering for me. What part of the environment here makes you think that it's easy for a GP to fire an FA? As far as I know, Jones can't fire me unless I either don't meet production requirements or I do something illegal, unethical, or against firm policy. Just because I get drunk and piss off a GP at a regional meeting because I tell him he's nothing but a pompous windbag and that his wife is ugly doesn't mean he has the ability to fire me come Monday morning. What doesn't seem far fetched to you is so far from reality that it isn't even funny. I might believe that all independant advisors steal from their clients because the environment makes it so easy to do. But that doesn't make it true.[quote=Spaceman Spiff][quote=uwec1986]Spiffy,
I missed your question about who hires the attny...sorry...I would...just like you would if you wanted one who looks out for you and not the firm. I've heard of rumors of GP's firing FA's on a whim but I really don't know for sure. I do BELIEVE it has happened because the environment there makes it easy. HQ thinks the FA are interchangeable cogs in the Jones wheel so firing one and putting in a rookie does not seem that far fetched to me. N.D., I think RJ takes a piece at the bond desk too so I'm guessing most firms do.[/quote] I agree that if I feel I needed someone to represent me because I feel that I may have done something wrong and therefore need some legal defense, then I'm certainly going to pay for that myself. I wouldn't expect Jones to cover that. But that doesn't answer my question. Let's say tomorrow you get served papers on an account which you know for a fact you haven't done anything either unethical or illegal with and you are confident you don't need a lawyer to represent you personally. And LPL agrees with you. Who gathers the requested paperwork? Who preps you for the deposition? Who pays for the attorney? I know you said you haven't had any complaints yet. Neither did my buddy until one walked into his office and handed him the court papers. You never know when it could happen. It's one small little thing, but I know for a fact that Jones will cover those bills and do that paperwork gathering for me. What part of the environment here makes you think that it's easy for a GP to fire an FA? As far as I know, Jones can't fire me unless I either don't meet production requirements or I do something illegal, unethical, or against firm policy. Just because I get drunk and piss off a GP at a regional meeting because I tell him he's nothing but a pompous windbag and that his wife is ugly doesn't mean he has the ability to fire me come Monday morning. What doesn't seem far fetched to you is so far from reality that it isn't even funny. I might believe that all independant advisors steal from their clients because the environment makes it so easy to do. But that doesn't make it true. [/quote] One of my business partners had exactly the scenario that you describe on an estate account. LPL did the prep work, gave him a consult with a lawyer for representation in short did everything that you think Jones would do. I consider this argument a non issue.Spiffy,
I guess I need more info. on the attny thing...If RJ is named, they will have their folks there and I assume they will gather the data. FA's will also have to gather info. like client notes not held on the system etc. We are spending too much time on this one in 10000 possibility. I'm guessing I have the same help from RJ as you. I do know that I have E&O to cover claims and I know you don't...that's a much bigger issue that this lawyer scenario. GP's can fire FA's anytime they like for any reason...especially here in FL because we are a Right to Work state...Employees can quit and Employers can fire you for any reason (excluding race). GP's are Gods at EJ...are you kidding me? Go tell a GP his wife is ugly and see what happens. Any place to report to someone, you can get fired without cause...it's called the real world. I don't report to someone so I can tell the President of RJ to kiss my a$$. Start asking questions about the VA commissions and see if you don't get on some black list...you have no clue what you're dealing with over there. Good luck with your delusions. It's no easier for an Indy to steal from clients than at EJ...remember the Jones FA in the south who killed himself because he got caught? Get off your BS EJ high horse and get a clue.No reason to keep pounding Spiff…he will fight to the bitter end. Funny we haven’t heard from Borker Boy…He might be gearing for a jump to INDY in January.
I can honestly say being Indy has been one of the best business decisions I've ever made. Heck, even my CPA decided to go out on his own after watching my practice grow the last 3 years. Spiffy's dribble on protection, cost...blah blah blah is so overblown its funny. I remember the day I made the call to St Louis about me leaving...she said.."Gosh, its soooo expensive to go Indy..how will you ever make it"...It ALL boils down to the work you do. IF you continue to work hard, you will be greatly rewarded being Indy. More so than anyplace else...Ah cmon Spears. Spiff can’t be all wet.
I have been trying for a couple of years to shed some light on the differences. He just can't or won't accept the fact that he is in a losing proposition. Either he will leave Jones or he will leave the business. His production isn't where any indy would want him to be his own OSJ, so he wouldn't have the advantages that we speak of.It would almost be a lateral move. Now if his production hits Seg 4 and his assets cross 25-30M then the light will shine. Let's hope he has the rose colored glasses off by then.[quote=BigCheese]Ah cmon Spears. Spiff can’t be all wet.
I have been trying for a couple of years to shed some light on the differences. He just can't or won't accept the fact that he is in a losing proposition. Either he will leave Jones or he will leave the business. His production isn't where any indy would want him to be his own OSJ, so he wouldn't have the advantages that we speak of.It would almost be a lateral move. Now if his production hits Seg 4 and his assets cross 25-30M then the light will shine. Let's hope he has the rose colored glasses off by then. [/quote] Oh, you are bad.Was that too pointed?
My bad. If the truth hurts...On a $250,000 fee based account where I work:
* Program fee is .21 * Ticket charges can be pased on to client or rep can eat it. * 12b-1 fees are passed along to rep on Non Retirement Accounts only.[quote=iceco1d] On a comparable program (regular rebalancing 4x or 2x per year, using mutual funds) at my firm, the numbers on a $250K account would be as follows:
1.35% average fee to client (we have no say in the fee).
0.88% would hit the “grid” (47 bps “program fee”).
No ticket charges (regardless of what funds you’re using)
12b-1 fees are paid out to the FA (Q & NQ accounts), if you use funds that pay them (there is no difference in fee structure if you use A shares @ NAV w/ 12b-1s, or if you use advisor shares w/o a 12b-1).
So in my example…the highest payout at my firm is 85%; if you are using Vanguard funds for this example, 88 bps would hit your grid @ 85% for a net payout of 74.8 bps. This is a 49.9% actual payout, based on the fee charged to the client.
In the same example, if you use funds that pay a 25 bps 12b-1, client would still see 1.35% in fees on the statement, 88 bps would hit your "grid’ as fee revenue, and another 25 bps would hit your grid as a trail. In this case, 1.13% hits your “grid” of 85% (no ticket charges, again). 1.13% x 85% = 96 bps net. Actual payout based on the 1.5% charged to the client is a 64% payout. 96 bps on 1.75% (the 1.5% + .25% 12b-1, total compensation related charges tot he client) is a 55% payout.
Some funds on this platform have revenue sharing agreements with the b/d on top of it (that doesn’t affect our compensation, but still…).
B/Ds love to play games. Indies notoriously love to play with program fees and ticket charges, so lets get this out in the open if we are talking about haircuts.
[/quote]
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[quote=iceco1d] On a comparable program (regular rebalancing 4x or 2x per year, using mutual funds) at my firm, the numbers on a $250K account would be as follows:
1.35% average fee to client (we have no say in the fee).
0.88% would hit the “grid” (47 bps “program fee”).
No ticket charges (regardless of what funds you’re using)
12b-1 fees are paid out to the FA (Q & NQ accounts), if you use funds that pay them (there is no difference in fee structure if you use A shares @ NAV w/ 12b-1s, or if you use advisor shares w/o a 12b-1).
So in my example…the highest payout at my firm is 85%; if you are using Vanguard funds for this example, 88 bps would hit your grid @ 85% for a net payout of 74.8 bps. This is a 49.9% actual payout, based on the fee charged to the client.
In the same example, if you use funds that pay a 25 bps 12b-1, client would still see 1.35% in fees on the statement, 88 bps would hit your "grid’ as fee revenue, and another 25 bps would hit your grid as a trail. In this case, 1.13% hits your “grid” of 85% (no ticket charges, again). 1.13% x 85% = 96 bps net. Actual payout based on the 1.5% charged to the client is a 64% payout. 96 bps on 1.75% (the 1.5% + .25% 12b-1, total compensation related charges tot he client) is a 55% payout.
Some funds on this platform have revenue sharing agreements with the b/d on top of it (that doesn’t affect our compensation, but still…).
B/Ds love to play games. Indies notoriously love to play with program fees and ticket charges, so lets get this out in the open if we are talking about haircuts.
[/quote]
speaking of haircuts, I found you school photo Ice
[quote=curly] [quote=iceco1d] On a comparable program (regular rebalancing 4x or 2x per year, using mutual funds) at my firm, the numbers on a $250K account would be as follows:
1.35% average fee to client (we have no say in the fee).
0.88% would hit the "grid" (47 bps "program fee").
No ticket charges (regardless of what funds you're using)
12b-1 fees are paid out to the FA (Q & NQ accounts), if you use funds that pay them (there is no difference in fee structure if you use A shares @ NAV w/ 12b-1s, or if you use advisor shares w/o a 12b-1).
So in my example...the highest payout at my firm is 85%; if you are using Vanguard funds for this example, 88 bps would hit your grid @ 85% for a net payout of 74.8 bps. This is a 49.9% actual payout, based on the fee charged to the client.
In the same example, if you use funds that pay a 25 bps 12b-1, client would still see 1.35% in fees on the statement, 88 bps would hit your "grid' as fee revenue, and another 25 bps would hit your grid as a trail. In this case, 1.13% hits your "grid" of 85% (no ticket charges, again). 1.13% x 85% = 96 bps net. Actual payout based on the 1.5% charged to the client is a 64% payout. 96 bps on 1.75% (the 1.5% + .25% 12b-1, total compensation related charges tot he client) is a 55% payout.
Some funds on this platform have revenue sharing agreements with the b/d on top of it (that doesn't affect our compensation, but still...).
B/Ds love to play games. Indies notoriously love to play with program fees and ticket charges, so lets get this out in the open if we are talking about haircuts.
[/quote]
speaking of haircuts, I found you school photo Ice
[/quote] Another troll....it crosses the line they impersonate the three stooges though
[quote=Mr.Blonde][quote=curly] [quote=iceco1d] On a comparable program (regular rebalancing 4x or 2x per year, using mutual funds) at my firm, the numbers on a $250K account would be as follows:
1.35% average fee to client (we have no say in the fee).
0.88% would hit the "grid" (47 bps "program fee").
No ticket charges (regardless of what funds you're using)
12b-1 fees are paid out to the FA (Q & NQ accounts), if you use funds that pay them (there is no difference in fee structure if you use A shares @ NAV w/ 12b-1s, or if you use advisor shares w/o a 12b-1).
So in my example...the highest payout at my firm is 85%; if you are using Vanguard funds for this example, 88 bps would hit your grid @ 85% for a net payout of 74.8 bps. This is a 49.9% actual payout, based on the fee charged to the client.
In the same example, if you use funds that pay a 25 bps 12b-1, client would still see 1.35% in fees on the statement, 88 bps would hit your "grid' as fee revenue, and another 25 bps would hit your grid as a trail. In this case, 1.13% hits your "grid" of 85% (no ticket charges, again). 1.13% x 85% = 96 bps net. Actual payout based on the 1.5% charged to the client is a 64% payout. 96 bps on 1.75% (the 1.5% + .25% 12b-1, total compensation related charges tot he client) is a 55% payout.
Some funds on this platform have revenue sharing agreements with the b/d on top of it (that doesn't affect our compensation, but still...).
B/Ds love to play games. Indies notoriously love to play with program fees and ticket charges, so lets get this out in the open if we are talking about haircuts.
[/quote]
speaking of haircuts, I found you school photo Ice
[/quote] Another troll....it crosses the line they impersonate the three stooges though[/quote] 133 posts since Oct. and you're not a troll? Maybe just a loser? WarDaddy wants to know.
The Coming Stock
Market Bubble Burst
I told a friend two years ago
That real estate’s a bubble.
“I know,” he said,” but what the heck,
I’ll scoot before there’s trouble.”
Alas, he stuck around too long,
He wanted to hit top;
Now he sings a pauper’s song,
His losses just won’t stop.
I’m telling you today, my friend,
With stock’s still flying high,
This market’s gonna crash quite soon,
Though I’m not sure just why.
It might be war, or debt, or oil,
The tripper? Take your pick.
I can’t predict exactly but…
I’m saying: “Get out quick.”
[quote=iceco1d]On a comparable program (regular rebalancing 4x or 2x per year, using mutual funds) at my firm, the numbers on a $250K account would be as follows:
1.35% average fee to client (we have no say in the fee). 0.88% would hit the "grid" (47 bps "program fee"). No ticket charges (regardless of what funds you're using) 12b-1 fees are paid out to the FA (Q & NQ accounts), if you use funds that pay them (there is no difference in fee structure if you use A shares @ NAV w/ 12b-1s, or if you use advisor shares w/o a 12b-1). So in my example...the highest payout at my firm is 85%; if you are using Vanguard funds for this example, 88 bps would hit your grid @ 85% for a net payout of 74.8 bps. This is a 49.9% actual payout, based on the fee charged to the client. In the same example, if you use funds that pay a 25 bps 12b-1, client would still see 1.35% in fees on the statement, 88 bps would hit your "grid' as fee revenue, and another 25 bps would hit your grid as a trail. In this case, 1.13% hits your "grid" of 85% (no ticket charges, again). 1.13% x 85% = 96 bps net. Actual payout based on the 1.5% charged to the client is a 64% payout. 96 bps on 1.75% (the 1.5% + .25% 12b-1, total compensation related charges tot he client) is a 55% payout. Some funds on this platform have revenue sharing agreements with the b/d on top of it (that doesn't affect our compensation, but still...). B/Ds love to play games. Indies notoriously love to play with program fees and ticket charges, so lets get this out in the open if we are talking about haircuts. [/quote] Finet example on a $250,000 account would be: 21bp admin fee, 90% payout, no ticket charges,(unsure about 12b1 fee rebate as I use stocks, etfs, or institutional share funds,etc) So: 1.35% client fee less 21bp admin fee= 1.14% Gross x 90% grid payout= 1.026% net to practice. (1.026 / 1.35 = 76% payout against client fee)Jones doesn’t hit us with a program fee. So, my compensation on advisory business at $250K would be 1.35% @ 40%. Clients get rebated the 12-b1 fees. They’ve got this weird pooling of shareholder accounting fees thing that they do, but basically the clients get those rebated too. None of that affects my compensation. The only time my payout gets affected is if I discount below a certain percentage or if I’m discounting and the account falls below $100K. If those things happen my payout drops to 30%. Consequently, I’m not discounting anything.
RJFS:
Advisor can set whatever price he/she wants. I average about 1.1% to be competitive but fair. RJ takes .09% admin, and .14% for advisory services or something. 1.35% (to use the same as everyone else) Less .23% Equals 1.12% - 100% of this number is paid to me. Client pays $30 transaction charges on stocks or mutual funds, but avoids it on systematic transactions or exchanges. No charge on sell trades. Therefore after the funds are in place we can systematically buy into funds for no transaction charge, which I do 99.9% of the time. $100,000 client $1120/yr to me Jones $540 to advisorQuestion for all…how do clients feel about paying ticket charges on top of management fees on top of mutual fund expenses? My biggest concern would be transferring in a client with a bunch of junk securities - they pay ticket charges to sell them, then pay ticket charges (possibly) to buy “your” stuff, plus the management fee (and then MFD expenses, which may or may not be high).
I was curious how people work around this, and how many eat the ticket charges versus charge the client.Good question, and another reason I do trades systematically over a number of weeks (normally 4-6). If we unwind and reinvest over that period of time, we increase the chances that we hit a good day to either sell or buy. That potential difference in one percent creates the opportunity to offset the one-time transactional charges they will see up front.
The same applies when we add a new fund, they pay $30 for the first trade, but average in and often times end up with a lower average price, offsetting the $30 charge.
Jones doesn’t hit us with a program fee. So, my compensation on advisory business at $250K would be 1.35% @ 40%. Clients get rebated the 12-b1 fees. They’ve got this weird pooling of shareholder accounting fees thing that they do, but basically the clients get those rebated too. None of that affects my compensation. The only time my payout gets affected is if I discount below a certain percentage or if I’m discounting and the account falls below $100K. If those things happen my payout drops to 30%. Consequently, I’m not discounting anything.
Au contraire mon frere (Yes I googled the spelling). If you are still presenting the program in that light, I would suggest you do some more reading.
Hulk, stop spoiling Spiff’s presentations. He doesn’t want to know what he doesn’t know…gee wiz…
Yeah, SPiff, it's more like you get rebated the 12b-1 and revenue sharing, but that generally offsets the shareholder accounting charges. It's fine right now, as there is generally a net credit to the account, but my concern is that some day if/when 12b-1's and revenue sharing go away, or Jones uses fewer funds with 12b-1's/revenue sharing, the Accounting charges may actually end up being a net expense (it's currently 9 bips, but offset by 12b-1 fees). Essentially, they are passing on 12b-1 credits and ticket charges to the client. It's all disclosed in the contracts, as well as on the statements. Personally, I wish Jones, as well as all other firms, would make all the fees more consistent and transparent, both to the advisors and the clients. So the fee is the fee is the fee. No "credits" no "offsets" no "ticket charges" or "program charges", no IRA fees, no transfer fees, etc. Make it simple. Here is the fee (say 1.5%) for advice, trading, and monitoring of your account. All inclusive. No haircuts, no other fees. No making it more painful for everyone involved. No more explaining things away. No more deciding between making a transaction or not because of ticket charges, etc. Our freakin industry just can't get it right. Ever.[quote=Spaceman Spiff] Jones doesn’t hit us with a program fee. So, my compensation on advisory business at $250K would be 1.35% @ 40%. Clients get rebated the 12-b1 fees. They’ve got this weird pooling of shareholder accounting fees thing that they do, but basically the clients get those rebated too. None of that affects my compensation. The only time my payout gets affected is if I discount below a certain percentage or if I’m discounting and the account falls below $100K. If those things happen my payout drops to 30%. Consequently, I’m not discounting anything. [/quote]
Au contraire mon frere (Yes I googled the spelling). If you are still presenting the program in that light, I would suggest you do some more reading.
B-
LPL gets it right when it comes to transparency. Your firm, EDJ,is the one whose montra is the client always comes first. That's BS and you, Spiff, et, al, know it. I give you kudos for at least breaking down the costs. Spiff...well let's just say he's a company man. I love that classic comment with EDJ reps...Its the industry. B you do know better!!!Not sure how LPL is any different. They still charge IRA fees, have ticket charges, collect revenue sharing kickbacks and 12b-1’s, etc. Not much difference there. All the same disclosures.
Part of the problem is that too many people have their hand in the cookie jar...fund companies, brokerage firms, advisors, stock exchanges, transfer agents, etc. But I think all of it should be behind the scenes, with the client paying ONE fee on their account, and the advisor earning ONE type of revenue (without hidden expenses like ticket charges, program fees, etc.), without any conflicts of interest (I'm not including insurance business). That way, the only variable is the fee. And it's in black and white. If the B/D's want to lower payout to compensate for their expenses, fine, but the nickel/dime crap adds up, and just complicates the entire process.And incidentally, I’m not trying to defend Jones or knock LPL, I think it’s more of an industry problem (and that’s not coming from “Jones”, that’s based on what I witness from other firms and hear from FA’s).
What you are saying is “it should all be hidden inside one fee.” We’d all like that, but increased disclosure has only created the animal you are describing. You are right, though, that there are way more people getting a slice of a smaller pie than there used to be.
You guys - B24 and Hulk - are of course correct on the shareholder accounting fees. I knew there was a 9bps charge to the account, but mistyped on the shareholder accounting fees. Caffeine wasn't quite engaged yet.
I know, I know, Spiff is too dumb to know what he doesn't know. Drinking the kool aid. Blah Blah Blah.What? You didn't know that LPL is THE PERFECT COMPANY? What rock have you been living under? I'm appalled that you would even utter that kind of blasphemy.Not sure how LPL is any different.
Spiff-
LPL has arrived...at least according to this author. http://www.financial-planning.com/fp_issues/2009_11/weve-arrived-lpl-2664390-1.htmlGreat. I’m happy for you. You should throw yourself a big party.
Spiff,
It's about the MATH...do yourself and your family a favor and get out.The simple fact remains: most of the LPL people that I come across are former Jones people. The size of LPL is now actually larger than Jones in number of advisors although the revenues that Jones produces is much higher. These are the facts. Why did this happen.....there are multiple ways to help clients meet their retirement goals that are legal, ethical and profitable. Jones is one way, LPL is another as is RJ. We must each find which way is best for them.Great. I’m happy for you. You should throw yourself a big party.
I heard LPL just built a new FA training center in St. Louis.
[quote=B24]
I heard LPL just built a new FA training center in St. Louis.
[/quote] I am trying hard to be balanced, B24.....[quote=noggin][quote=B24]
I heard LPL just built a new FA training center in St. Louis.
[/quote] I am trying hard to be balanced, B24.....[/quote] Agreed. It just seems like EDJ is the training ground for LPL. I bet the Execs at LPL laugh about it all the time. They probably have a very formal Jones recruiting strategy.[quote=B24][quote=noggin][quote=B24]
I heard LPL just built a new FA training center in St. Louis.
[/quote] I am trying hard to be balanced, B24.....[/quote] Agreed. It just seems like EDJ is the training ground for LPL. I bet the Execs at LPL laugh about it all the time. They probably have a very formal Jones recruiting strategy.[/quote] I'll agree 100% with what you just said. My recruiter indicated that Edward Jones advisors were his #1 source of recruits and #2 wasn't even in the same area code. Even a formal Jones recruiting strategy would not surprise me. There's a reason your GP's and RL's talk so negatively about LPL.The simple fact remains: most of the LPL people that I come across are former Jones people. The size of LPL is now actually larger than Jones in number of advisors although the revenues that Jones produces is much higher. These are the facts. Why did this happen.....there are multiple ways to help clients meet their retirement goals that are legal, ethical and profitable. Jones is one way, LPL is another as is RJ. We must each find which way is best for them.[/quote] According to that article that foot linked LPL now has around 12,500 advisors. Jones is just over 12,000. I wouldn't call that much larger. How many of those 12,500 advisors are just CPAs who happen to do some investments on the side and would be considered part time? Probably a few thousand. I don't disagree that the LPL force is big, but those numbers are misleading. Kind of like EDJ saying that we are the number one brokerage firm if you count the number of offices we have. While technically that's true, it's not a meaningful stat. That article referenced the "culture" of LPL. The guy they quoted talked about Todd Robinson thanking advisors for their business. He said that there is a "Commitment Creed" which is in every office, and was erected on an 18 foot high pavilion at the national convention this year. When it comes from Jones, we're a cult. So what is it at LPL? The maintenance man on the Segway was classic. I don't have any problem with LPL. Or Raymond James or any other firm out there. I simply don't care. If what noggin says is true, that this is about finding what's best for my clients, then I don't think I'll ever have a reason to leave EDJ. But these conversations are not about what is best for my clients. They are almost always about what is best for me and my paycheck.[quote=Spaceman Spiff]Great. I’m happy for you. You should throw yourself a big party.
Spiffy,
You mention the CPA's, etc...how many of the Jones offices are new guys with not clients or assets...hmmm...2400 new brokers added to the Jones roster every year... The discussion is about both what good for the client and for your family. EJ has a limited menu, and that's ok but Indy offices can offer more. If you go Indy, you'll most likely do what the rest of us old EJ folks do...Run and EJ office for the 1st year or longer. You are not required to change your approach...if you think EJ's limited menu is great...keep using it in your Indy office...and you'll net 30% more with no more risk to you or your clients. At this stage in your career...what is Jones doing for you to get the huge cut of your production?When it comes from Jones, we’re a cult. So what is it at LPL
Spiff- What is LPL? I think the last word in the dictionary I would reference would be a cult. They don't tell me what is appropriate for my clients. At Jones you have to fit your clients into a compliance approved product or model of some kind. You can't step outside the box even if your client requests it. What is LPL? A company that considers its customers us. This is a major diffference than your firm who shouts from the rafters that their clients come first. BS. The GP's come first, then the clients, and at the end of the day if there are any remnants left...the poor FA. What is LPL? A changeable part. Just like you. If we don't like them for one reason or another we can go to RayJay or Commonwealth etc., and our clients come with us. If you leave you will really understand who are YOUR clients vs Jones clients. What is LPL? A force to be reckoned with. And the likely recipient of good Jones folks who ultimately see that the benefits of staying at Jones diminishes as you produce more. Once you attain those production levels, my guess is you will start to change your perspective. I did.foot - You did a wonderful job spouting the same old rhetoric, Mr. One Trick Pony, but you didn’t answer the question. Putting up a big banner that repeats the company’s mantra at the national convention is LPL’s way of trying to create a culture. I get it. Kumbaya and all that. Your leader stands up at the mic and gets all of you to recite the Commitment Creed with him. Warm fuzzies all around. You can all go back to your offices and feel good about the company you are affiliated with. After all, they are the best in the independant business. They just said so at the big meeting right after the James Taylor concert. Just the thought of it gives me goosebumps. I’m just sayin you should be careful spouting stuff in the future about the cult side of EDJ if your company acts in the same way.
BTW, you did a great job outlining some of the differences between the two business models, just like you always do. Sidebar question - that article implies that LPL is going to go public. What happens to you, the customer, when the board needs to make sure the EBITDA looks good and is headed in positive territory? Do they cut costs at HQ? Do service issues become a problem? Do they lower your payout? The article said they raised the payout for top producers recently from 92% to 98%, I believe. Why wouldn't they do that for everyone? That doesn't seem quite fair, now does it. Do they drop it back to 92% if things get rocky and they're worried about their share price? I'm just curious how going IPO would help/hurt LPL in the long run.Spiff-
Thanks for reminding me that I am spouting the same old rhetoric. Pot calling kettle big time...LPL is going public at some point. They already have a skeleton support crew...not sure they could cut more. If they stop serving me, then I can change. It would be a pain in the aarse, but at least its an option. As for the payout issue, they are rewarding the top producers. They are making sure that everyone isn't treated the same. (Remember your cult reference?)Hey Spiff-
One trick pony? Dude thanks for the reference....Any sarcasm in your losing battle to defend Jones? Maybe some of the outsiders to our discussion might want to give their wisdom. BTW...when I linked that article, did I have any sarcasm associated with it? Hell yes. I don't believe any of the crap, probably LPL paid for the article. I don't think the firm is superior, just the best of the indies right now. Sounds balanced to me, but maybe Spiff you can twist is like you accuse me of regularly. Was that your intent? I am a little slow for a one trick pony.[quote=uwec1986]Spiffy,
You mention the CPA's, etc...how many of the Jones offices are new guys with not clients or assets...hmmm...2400 new brokers added to the Jones roster every year... The discussion is about both what good for the client and for your family. EJ has a limited menu, and that's ok but Indy offices can offer more. If you go Indy, you'll most likely do what the rest of us old EJ folks do...Run and EJ office for the 1st year or longer. You are not required to change your approach...if you think EJ's limited menu is great...keep using it in your Indy office...and you'll net 30% more with no more risk to you or your clients. At this stage in your career...what is Jones doing for you to get the huge cut of your production? [/quote] I understand that indy offices CAN offer more. But for the most part, it's just a variation on a theme. Stocks vs bonds in some form or fashion. Whatever fancy title you put on it, it is what it is. With the exception of a rare client or two who asked about options, there hasn't been anything from an investment standpoint that ANY client or prospect has asked me about that I can't handle. Most people don't even know things like private REITS exist. They think they're pretty fancy when they buy a preferred stock or a closed ended fund. As to what Jones is providing: Office Office furniture Painting services Carpeting Light bulbs Utilities Computer workstations X 2 Printer Internet service Fax machine Check scanner Phone system Integrated on hold music for said phone system Software: Contact Management System Email Financial Planning Trading systems Morningstar Quote System Ad/Flier marketing building system Fax Management Software Check Scanning software Online client document imaging and storage software Business Cards Various Monthly client mailers (IP) BOA BOA benefits BOA tuition reimbursement Profit sharing for BOA and FA 401k Matching for BOA Bonuses for BOA Bonuses for FA Matching bonus for BOA if FA shares his bonus Marketing Materials National Marketing radio and TV spots Spring/Summer (family included)/Fall regional meetings Ongoing training CE Regulatory exams Adoption remibursement CFP/AAMS tuition reimbursement Tuition Reimbursement Seminar Reimbursement Mileage reimbursement Diversification Trips Regional support and meetings HQ support - training HQ Service - operational Research - stocks/bonds/funds/Advisory/ETF, etc Compliance Product Review Legal Assistance if necessary Artwork in office Preapproved Seminar Scripts/Powerpoints/Materials I'm sure I've missed some things, but that's a pretty good start. When I stop and think about all the things that go on here in my office without me even having to think about them or write a check to make sure they get done, your "what's Jones done for you lately" seems a little trite. Could I make more money if I were with LPL or RJ? Yep. Absolutely. No doubt about it. Do I want to even worry or have to make decisions about the things above? Nope. Thus the reason Jones works for me right now. 10 years from now when I'm a $1MM producer? We'll see.[quote=Spaceman Spiff][quote=uwec1986]Spiffy,
You mention the CPA's, etc...how many of the Jones offices are new guys with not clients or assets...hmmm...2400 new brokers added to the Jones roster every year... The discussion is about both what good for the client and for your family. EJ has a limited menu, and that's ok but Indy offices can offer more. If you go Indy, you'll most likely do what the rest of us old EJ folks do...Run and EJ office for the 1st year or longer. You are not required to change your approach...if you think EJ's limited menu is great...keep using it in your Indy office...and you'll net 30% more with no more risk to you or your clients. At this stage in your career...what is Jones doing for you to get the huge cut of your production? [/quote] I understand that indy offices CAN offer more. But for the most part, it's just a variation on a theme. Stocks vs bonds in some form or fashion. Whatever fancy title you put on it, it is what it is. With the exception of a rare client or two who asked about options, there hasn't been anything from an investment standpoint that ANY client or prospect has asked me about that I can't handle. Most people don't even know things like private REITS exist. They think they're pretty fancy when they buy a preferred stock or a closed ended fund. As to what Jones is providing: Office Office furniture Painting services Carpeting Light bulbs Utilities Computer workstations X 2 Printer Internet service Fax machine Check scanner Phone system Integrated on hold music for said phone system Software: Contact Management System Email Financial Planning Trading systems Morningstar Quote System Ad/Flier marketing building system Fax Management Software Check Scanning software Online client document imaging and storage software Business Cards Various Monthly client mailers (IP) BOA BOA benefits BOA tuition reimbursement Profit sharing for BOA and FA 401k Matching for BOA Bonuses for BOA Bonuses for FA Matching bonus for BOA if FA shares his bonus Marketing Materials National Marketing radio and TV spots Spring/Summer (family included)/Fall regional meetings Ongoing training CE Regulatory exams Adoption remibursement CFP/AAMS tuition reimbursement Tuition Reimbursement Seminar Reimbursement Mileage reimbursement Diversification Trips Regional support and meetings HQ support - training HQ Service - operational Research - stocks/bonds/funds/Advisory/ETF, etc Compliance Product Review Legal Assistance if necessary Artwork in office Preapproved Seminar Scripts/Powerpoints/Materials I'm sure I've missed some things, but that's a pretty good start. When I stop and think about all the things that go on here in my office without me even having to think about them or write a check to make sure they get done, your "what's Jones done for you lately" seems a little trite. Could I make more money if I were with LPL or RJ? Yep. Absolutely. No doubt about it. Do I want to even worry or have to make decisions about the things above? Nope. Thus the reason Jones works for me right now. 10 years from now when I'm a $1MM producer? We'll see. [/quote] Wow, its the HR handbook in one post.Spiff, you could pay someone to worry about all of the above (which I do) and still take home more. By the way, me being happier serves my clients well IMO. Last, I have realized that when someone couldn’t transfer an investment to me at Jones I used to think “it’s not very good anyway.” Now I can objectively evaluate someone’s assets, and if they are serving a purpose, I can work them into the portfolio, and if appropriate, include that asset in the client’s advisory fee agreement. Eliminates another CONFLICT OF INTEREST. You don’t realize how many of them there are until you don’t have them anymore. I was the same way.
I don’t understand why anybody would put up with an independent B/D. Why not keep ALL of the revenue?
If you want to earn commissions.
If you want to earn commissions.
Not worth it. You can structure your RIA so that you can earn fees similar to commissions.
Left Jones October 2004 Gross $437,000. Last year $1,000,000. Jones net about $150. My next last year about $500K. 80% of revenue is reoccurring.
More control, unbiased advice, true wealth management. So glad I did it and I believe any Jones rep should at least look into it. The RIA idea makes a lot of sense as well.Pre Tax Net paid about $100K in Federal Taxes.
Also paid my car expenses, $20K to SIMPLE, $6K to HSA and other expenses out of company. Definately some tax benefits as well. Went to Commonwealth although I am considering going RIA OnlyYes I have an S Corp
Still miss the trips and the people. EDJ folks are down to earth[quote=indyboy]
Yes I have an S Corp
Still miss the trips and the people. EDJ folks are down to earth[/quote]Down to earth, or dumbed down?
[quote=Moraen] [quote=indyboy]
Yes I have an S Corp
Still miss the trips and the people. EDJ folks are down to earth[/quote]Down to earth, or dumbed down?
[/quote] - It's like asking someone of they've "lost some weight". Translation - "boy, you were fat before, way to take care of that".
[quote=Moraen] [quote=indyboy]
Yes I have an S Corp
Still miss the trips and the people. EDJ folks are down to earth[/quote]Down to earth, or dumbed down?
[/quote] Many of the people I am friends with at Jones would continue to be friends if I left. There are a lot of good people here....IQ aside. And I can say that without reservation, as I have a good friend that left Jones late last year, and we continue to include him in non-Jones get-togethers and people still speak well of him at Jones gatherings.
[quote=B24][quote=Moraen] [quote=indyboy]
Yes I have an S Corp
Still miss the trips and the people. EDJ folks are down to earth[/quote]Down to earth, or dumbed down?
[/quote] Many of the people I am friends with at Jones would continue to be friends if I left. There are a lot of good people here....IQ aside. And I can say that without reservation, as I have a good friend that left Jones late last year, and we continue to include him in non-Jones get-togethers and people still speak well of him at Jones gatherings. [/quote]
I don't think you know how amazing that last part is.
He also did it the right way. He was a good guy through the end. Never bad-mouthed the firm. I see a lot of people leave Jones, but towards the last few months, they start bad-mouthing Jones, talking about how bad a firm they are, how dumb their methods are, how they can’t feed their family (as if their production is Jones’ fault), etc. Those are the people that most of us never maintain relationships with. That kind of stuff puts a bad taste in your mouth.
Also, we just don't have a lot of vindictive or spiteful people in my circle at Jones. Not to say it doesn't happen elsewhere. We also don't have a lot of long-time vets. The first broker in our region started about 18 years ago. We have a few in the 15-18 year. Many in the 10-15 year range. Lots under 10 years. So not as much Jones "heritage" in my region.Down to earth, or dumbed down?
I would say both after reading Spiff’s version of the benefits of Jones manual on the previous page. Anyone dumb enough to pontificate about the wonders of their company has me baffled. Once could reasonably assume he couldn’t sell himself as much as his company.I would congratulate him that he has found his niche. I doubt he could attain 1M in production anywhere but Jones in 10 years…
[quote=BigCheese]Did you hit your bogey today?
[/quote] Yes. Today's and tomorrow's actually.I remember after I left Edward Jones-- I got calls and office visits from Jones reps literally around the country. The questions were all centered around one issue: "Is it really better?" "Why is it better?" They wanted to see the technology, the bond inventory, the research, etc... Some of these folks eventually left Jones and all I know of are MUCH happier; however, some are still at Jones today. I believe these people are restrained by fear. Fear of the unknown is a great motivator and simultaneous creator of complacency....
It has always puzzled me why any veteran financial advisor would ever remain at Jones. I mean seriously...there is simply no good business reason. To remain at Jones is throwing money down the drain. To spend your career there places you and your family in a lesser financial position in more ways than one; however, it is the essence of what makes the Jones model a profitable one. No stockholder dividends, debt is LP (love it...which the firm makes you feel like you are getting something great) which you cannot keep when you retire. It is a great business model, but just for the business itself. Somewhere...something has to give. Unfortunately, most of the giving is done by the Financial Advisor. Yet, somehow the "greatest salesforce" in the industry remains convinced that they are getting a great deal. Amazing. The fact remains that Jones has done a remarkable job of building a brand loyalty. Perhaps better than any other company in the financial services industry. Why else would Jones reps vote their firm "#1 in RR survey" and near the top in "the best companies to work for?" It's because the financial advisors truly feel they are getting the best deal at the best firm in the industry. They are so certain they are doing all the right things as did the Jim Jones followers before they drank the magic juice. Yep, just as sure as an islamic extremeist believes he will spend eternity with 27 virgins, the Jones rep feels he belongs to something wonderful that no one else has. Hats off..or should I say bottoms up...to Edward Jones. Jones reps feel this way because they are taught that they are the best of the best even before they look at their first ICA mountain chart. Regardless of what field or background you came from, you are taught that the Jones way is the best way. You are taught the history of the firm and made to feel as if you are a part of something really special. They do a fantastic job of somehow isolating themselves from everyone else--and that includes the isolation of the Jones Financial Advisor. This isolation which we make fun of the Jones rep for "drinking the kool-aid" is the very essence of the Jones model upon which their foundation is built. It is my hope that others who read this thread will continue to step out of their kool aid induced stupor and realize that they have worked too hard and too long in a very difficult business. They owe it to themselves and to their families to afford themselves better than what Edward Jones brings to the table. It can be RJ, Commonwealth, LPL as it doesn't matter as much. What matters is the grass on the other side of the fence really is greener and you will wonder why it took you so long to climb over it.You do realize that I’ve created a character on this forum, right?
Sorry I didn't know this was about fiction. I thought this was supposed to be a forum where we could learn from each other. I realize you like to make yourself look smarter at my expense, but when you keep spouting the same thing over and over, it doesn't really help your case. Had I realized that all you want is conversation, I would have quit long ago. Try reading Zackos comments above. Does that sound mean spirited? Now all you do is try to figure out a way to make some sort of comments about me. To me that just makes you, along with uwec and the occasional comment from spears, pitiful. You need help. You spend way too much time on these forums and you are right about one thing, I won't continue this since you admit you have created a character and for you it apparently is all about f___cking with people. I hope the newbies on this forum read this, because they think you know what you are talking about. Pitiful.With Zacko's comment, I will sign off. Starting my 4th year with LPL and not once has a thought of moving/changing firms occured(weekly/daily at EDJ). If you don't investigate going Indy, IMO, you are making a huge career mistake. Good luck to all.
Spiffy,
I haven't attacked you at all, I've presented the idea that ANYONE at EJ with more than $20mil in assets is costing themselves money. I've also addressed the hypocrisy of EJ's and your position that EJ is way more ethical than the rest of the planet. I don't feel bad about being responsible for putting a light on EJ's revenue sharing issues and EJ's actions cost them $202 mil. EJ knows who I am but I haven't heard anything from their lawyers so I can assume they just figured the information was accurate. The debate issues are: 1. Is EJ a great place to start: YES 2. Does EJ imply the FA is running his own business: YES 3. Is EJ a great training ground for going Indy: YES 4. EJ tells the world they are better for clients and doesn't do bad MFD stuff, is that true: NO 5. Does EJ keep about 95% of the Rev. Sharing $ but discourages FA's from annuitizing their book: YES 6. Does EJ give you a haircut on your VA's of .75 - 1.25 bps: YES 7. Can you go Indy run a "Jones" office, increase your net but 20 - 40% with the same risk: YES 8. If you go Indy can you use the same volunteer hours EJ expects out of you to do the additional admin. work it takes to run an Indy office vs. EJ: YES 9. Is EJ a bunch of big fat liars: YES (ok...that was a joke) 10. Once you leave EJ do you find out a lot about what was really wrong with the culture of EJ: YES 11. Are A-shares always better for the client as EJ states: NO 12. Is EJ extremely limited in their VA products: YES 13. At EJ, do you have to pay for (TP, part of phones, pens, postage, etc, etc): YES 14. Is part of the BOA's job to spy on the FA: YES 15. Does it really cost $1,325 every month for the Jones tech.: NO 16. Did Doug Hill get fired because of me: YES Need I go on? Spiffy...get a clue...buy a vowel...something. The personal attacks have come from you, not me. I have simply debated the issues...if you don't have a leg to stand on...I suggest you say nothing.[quote=BigCheese]You do realize that I’ve created a character on this forum, right?
Sorry I didn't know this was about fiction. I thought this was supposed to be a forum where we could learn from each other. I realize you like to make yourself look smarter at my expense, but when you keep spouting the same thing over and over, it doesn't really help your case. Had I realized that all you want is conversation, I would have quit long ago. Try reading Zackos comments above. Does that sound mean spirited? Now all you do is try to figure out a way to make some sort of comments about me. To me that just makes you, along with uwec and the occasional comment from spears, pitiful. You need help. You spend way too much time on these forums and you are right about one thing, I won't continue this since you admit you have created a character and for you it apparently is all about f___cking with people. I hope the newbies on this forum read this, because they think you know what you are talking about. Pitiful.[/quote] What exactly do you think people are going to learn from you and I going back and forth about how good/bad EDJ is? You're not going to change my mind and I'm not going to change yours. It's really pretty stupid. I try really hard with people besides you and uwec and occasionally spears to try to tell the good and bad parts about Jones. Folks like yourself who have very little reason for coming on here besides trying to get everyone at Jones to "step out of their kool aid induced stupor" are the reason I come across very often as so pro-Jones. I don't come here everyday thinking about how I can get someone to think one way or another. In fact, most of the comments I make about Jones are in response to a negative comment. There happen to be a lot of negative comments, so I have plenty of material to work with. I hope the newbies do read this stuff. I hope they are smart enough to know that the truth about Jones vs indy is somewhere in the middle between what I say and what you say. I believe there are some people who just simply aren't cut out to be an independant advisor. There is absolutely an opportunity cost to staying with Jones or Morgan Stanley or Merrill Lynch. There is an opportunity cost for being an employee vs being the owner in any business. It absolutely doesn't mean that your quality of life is going to suffer if you remain an employee. However, it will mean that the owner of the company will have more money than you do. That's just business. To some it makes more sense to be the business owner, but others are just as happy being the employee. Zacko's original post was not mean spirited, much. I'm still not sure why he felt the need to break the silence and say it, but whatever. Zacko's last post with comments about Jim Jones and Islamic terrorists, however, were mean spirited. He's the exact antithesis of the guy that B24 said he is still friends with. LET IT GO.There is an opportunity cost for being an employee vs being the owner in any business. It absolutely doesn’t mean that your quality of life is going to suffer if you remain an employee.
I think this is the bottom line. Jones is not "bad". They are simply an employer, just like Bank of America, MSSB, Wells Fargo, and UBS (and all the regionals). I think I read somewhere that there are like 90,000 RReps at the major captive firms. They can't all be "wrong". They simply choose to be employees. As Spiff said, some people will NEVER be business owners, even if theya re very good at selling and being an advisor. Some people could actually be very GOOD business owners, but are too scared to make the leap. In any case, the whole argument is sort of silly. However, I think JOnes' business model prepares FA's better than almost any other firm for independant life. Their very strength is also their biggest weakness. Although they also try to force-feed a model that makes the leap to indy tough to stomach for vets (bringing on many hundreds, sometimes 1000's of clients).Those of you who are independent and seek to grow not just by assets, but by people as well…
I think you would do well to learn the lesson that Jones teaches. You should try to create an environment that encourages people to take ownership. Do you want EVERYBODY to be independent?
I don’t. I like having people to work with clients that I don’t want. But I also like the revenue.
While the Jones culture is certainly not one I am a big fan of, others are. It suits them. Jones knows they won’t be the right place for everybody.
Just like I won’t be the right place for everybody (apparently not even close).
Seriously, I just had a meeting where I basically talked about how great our firm was and how different we were and why people should come to us for advice.
That’s what firms DO. Do you think I’m going to talk about how great all of the other indy advisors are?
Look, I have my issues with Jones, but the fact that they are trying to grow their business and create loyal followers is not one of them.
Often, it’s just how they go about it. But that’s their choice. I don’t believe they are an evil organization.
I think this is pointless talk.
[quote=Spaceman Spiff][quote=uwec1986]Spiffy,
You mention the CPA's, etc...how many of the Jones offices are new guys with not clients or assets...hmmm...2400 new brokers added to the Jones roster every year... The discussion is about both what good for the client and for your family. EJ has a limited menu, and that's ok but Indy offices can offer more. If you go Indy, you'll most likely do what the rest of us old EJ folks do...Run and EJ office for the 1st year or longer. You are not required to change your approach...if you think EJ's limited menu is great...keep using it in your Indy office...and you'll net 30% more with no more risk to you or your clients. At this stage in your career...what is Jones doing for you to get the huge cut of your production? [/quote] I understand that indy offices CAN offer more. But for the most part, it's just a variation on a theme. Stocks vs bonds in some form or fashion. Whatever fancy title you put on it, it is what it is. With the exception of a rare client or two who asked about options, there hasn't been anything from an investment standpoint that ANY client or prospect has asked me about that I can't handle. Most people don't even know things like private REITS exist. They think they're pretty fancy when they buy a preferred stock or a closed ended fund. [/quote] You shouldn't even be thinking about "can I handle this investment request from this prospect/client?". They shouldn't even be asking you about products. You should be the one going to them with ideas on products, and you should want to have a nice product line to offer them. Who gives a sh!t if clients don't know what a private REIT is? Very few of my clients did before I sold it to them. Its your job to know what it is, not theirs. Its funny that you say that no one has come to you with an investment question about a product that you haven't been able to handle. That should go without saying. Wouldn't it be great one day to be able to control how your clients accounts do at the end of the year, without worrying if the fund manager for AWSHX or AGTHX is on his game?Rarely do I have a client ask me about a product other than gold. Twice, no three times today I had a conversation about gold. It's actually rare for me to have a client ask me about any investments. I'm normally the one telling them about ideas. Just because I said I didn't have anyone asking me about things I can't handle doesn't mean that I'm not the one calling the shots in my office.
I'll go back to my original comment that at the end of the day this business is about stocks vs bonds. Period. Whatever variation we put out there, it's still about owning an equity stake or loaning your money to someone. Access to alternative investments, IMHO, is only important if that's the business you want to be in. If you like spending your time researching, calling, explaining, tracking, etc those kind of things, knock yourself out. I don't. I think clients are more concerned with what we do not how we do it. They're much more concerned with retiring, college, weddings, and estate planning than learning about a new product from me. At least that's what I've found with my clients. Would it be helpful for that one prospect or client out there that is, I'll say bored, with the traditional approach to have something new and exciting in my back pocket? Maybe. But I'm not going to switch firms because Jones has a traditional investing approach. Would it be great to control my clients accounts? Absolutely. Of course I could only buy fixed annuities for them and I could do that all day long. I could buy ETFs and not have to worry about money managers at all. BTW, Wash Mutual and Growth Fund are team managed. Just FYI in case you forgot.[quote=Spaceman Spiff]
Rarely do I have a client ask me about a product other than gold. Twice, no three times today I had a conversation about gold. It’s actually rare for me to have a client ask me about any investments. I’m normally the one telling them about ideas. Just because I said I didn’t have anyone asking me about things I can’t handle doesn’t mean that I’m not the one calling the shots in my office.
I'll go back to my original comment that at the end of the day this business is about stocks vs bonds. Period. Whatever variation we put out there, it's still about owning an equity stake or loaning your money to someone. Access to alternative investments, IMHO, is only important if that's the business you want to be in. If you like spending your time researching, calling, explaining, tracking, etc those kind of things, knock yourself out. I don't. I think clients are more concerned with what we do not how we do it. They're much more concerned with retiring, college, weddings, and estate planning than learning about a new product from me. At least that's what I've found with my clients. Would it be helpful for that one prospect or client out there that is, I'll say bored, with the traditional approach to have something new and exciting in my back pocket? Maybe. But I'm not going to switch firms because Jones has a traditional investing approach. Would it be great to control my clients accounts? Absolutely. Of course I could only buy fixed annuities for them and I could do that all day long. I could buy ETFs and not have to worry about money managers at all. BTW, Wash Mutual and Growth Fund are team managed. Just FYI in case you forgot. [/quote]Spiff, I used to be with you on the stocks v. bonds theme. Since then I have come to the realization the portfolios are less volatile with commodities and real estate components in them. If that makes the clients more likely to stay with the portfolios we put in place for them, it serves THE CLIENT very well.
My RL trained me to believe that mid and small cap stock funds were unnecessary as well. I have since come to the realization that he was wrong. Ignoring multiple asset classes serves the advisor well more so than THE CLIENT. (i.e. it's too hard to keep track of all that stuff).
[quote=Spaceman Spiff]Rarely do I have a client ask me about a product other than gold. Twice, no three times today I had a conversation about gold. It’s actually rare for me to have a client ask me about any investments. I’m normally the one telling them about ideas. Just because I said I didn’t have anyone asking me about things I can’t handle doesn’t mean that I’m not the one calling the shots in my office.
I'll go back to my original comment that at the end of the day this business is about stocks vs bonds. Period. Whatever variation we put out there, it's still about owning an equity stake or loaning your money to someone. Access to alternative investments, IMHO, is only important if that's the business you want to be in. If you like spending your time researching, calling, explaining, tracking, etc those kind of things, knock yourself out. I don't. I think clients are more concerned with what we do not how we do it. They're much more concerned with retiring, college, weddings, and estate planning than learning about a new product from me. At least that's what I've found with my clients. [/quote] Then get them to their goals quicker. You're not going to find opportunties with global infrastructure, ChIndia, base metals, communication & technology inside American funds or Advisory Solutions. You can buy ETF's all you want in regular brokerage accounts but will clients be ok with paying commissions on every trade? How can you possibly do whats best for a client if you can't use fee-based accounts that allow you to actually pick the investments. Your fee based model is basically a retirement lifecycle mutual fund. [quote=Spaceman Spiff]Would it be helpful for that one prospect or client out there that is, I'll say bored, with the traditional approach to have something new and exciting in my back pocket? Maybe. But I'm not going to switch firms because Jones has a traditional investing approach. [/quote] Buy and hold is for losers. It's the lazy way to invest and over the past 10 years hasn't worked. Its for investors and investment professionals that don't want to do the research necessary to find the tactical opportunities that will get the extra couple percent per year that will help the clients goals be reached. [quote=Spaceman Spiff]Would it be great to control my clients accounts? Absolutely. Of course I could only buy fixed annuities for them and I could do that all day long. I could buy ETFs and not have to worry about money managers at all. BTW, Wash Mutual and Growth Fund are team managed. Just FYI in case you forgot. [/quote] I meant for it to mean "control how the clients year-end statement looks, as far as the bottom line goes". You know why Edward Jones wants you to use the buy and hold approach? Because they don't want you doing actual research that will make you more knowledgable because it will take away time for you to go knock on doors. The clients you got 6 months ago are suffering from your lack of knowledge so you can have a few hours extra each day to get your quota of contacts. If you simply do a great job of getting superior performance then you'll get enough referrals to keep you from needing to knock all day. The company doesn't get a higher profit from you knowing actual market tactics, they get a higher profit by you knocking 8 hours a day. THE COMPANY gets more. But its YOUR business!!I have been considering Edward Jones for quite some time, after 10+ years in the business as primarily a wholesaler (with Jones as my main account) and an equities trader.
I wanted to see if anyone had any detailed info on the different programs available (PASS, legacy, and goodnight). If you had your choice of the 3, which one would you pick? Also, anyone know what the different seg levels make on ave? I have heard some pretty questionable claims, and was hoping someone had some insight. Any info would be greatly appreciated!! ThanksJAM99 you’re treading in the wrong thread with questions like this. You’d be best served heading over to the rookie board. You are seeing things that a child should not see about Jones inside this thread.
I meant for it to mean “control how the clients year-end statement looks, as far as the bottom line goes”. You know why Edward Jones wants you to use the buy and hold approach? Because they don’t want you doing actual research that will make you more knowledgable because it will take away time for you to go knock on doors. The clients you got 6 months ago are suffering from your lack of knowledge so you can have a few hours extra each day to get your quota of contacts. If you simply do a great job of getting superior performance then you’ll get enough referrals to keep you from needing to knock all day. The company doesn’t get a higher profit from you knowing actual market tactics, they get a higher profit by you knocking 8 hours a day. THE COMPANY gets more. But its YOUR business!!
a lil girl that built his business with fish bowls is judging? when you work for a real firm let us know and then you can give advice. YUP
Haven't done a lunch and learn in almost 2 years. Being on a platinum team for Ameriprise on the P2 side is as independent as I need to be, only thing we don't get is diverse choice of annuities. I'm ok with that. Which heavyhitter are you hawking stocks for, clown?[quote=3rdyrp2] I meant for it to mean “control how the clients year-end statement looks, as far as the bottom line goes”. You know why Edward Jones wants you to use the buy and hold approach? Because they don’t want you doing actual research that will make you more knowledgable because it will take away time for you to go knock on doors. The clients you got 6 months ago are suffering from your lack of knowledge so you can have a few hours extra each day to get your quota of contacts. If you simply do a great job of getting superior performance then you’ll get enough referrals to keep you from needing to knock all day. The company doesn’t get a higher profit from you knowing actual market tactics, they get a higher profit by you knocking 8 hours a day. THE COMPANY gets more. But its YOUR business!! [/quote]
a lil girl that built his business with fish bowls is judging? when you work for a real firm let us know and then you can give advice. YUP
[quote=hotair1] [quote=3rdyrp2] I meant for it to mean “control how the clients year-end statement looks, as far as the bottom line goes”. You know why Edward Jones wants you to use the buy and hold approach? Because they don’t want you doing actual research that will make you more knowledgable because it will take away time for you to go knock on doors. The clients you got 6 months ago are suffering from your lack of knowledge so you can have a few hours extra each day to get your quota of contacts. If you simply do a great job of getting superior performance then you’ll get enough referrals to keep you from needing to knock all day. The company doesn’t get a higher profit from you knowing actual market tactics, they get a higher profit by you knocking 8 hours a day. THE COMPANY gets more. But its YOUR business!! [/quote] a lil girl that built his business with fish bowls is judging? when you work for a real firm let us know and then you can give advice. YUP
Haven’t done a lunch and learn in almost 2 years. Being on a platinum team for Ameriprise on the P2 side is as independent as I need to be, only thing we don’t get is diverse choice of annuities. I’m ok with that. Which heavyhitter are you hawking stocks for, clown?[/quote]
I’m a riversource rep: American Express and American Express Financial Advisors - The Unofficial Consumer Opinion Site
[quote=LuvIndy] [quote=Spaceman Spiff]
Rarely do I have a client ask me about a product other than gold. Twice, no three times today I had a conversation about gold. It's actually rare for me to have a client ask me about any investments. I'm normally the one telling them about ideas. Just because I said I didn't have anyone asking me about things I can't handle doesn't mean that I'm not the one calling the shots in my office.
I'll go back to my original comment that at the end of the day this business is about stocks vs bonds. Period. Whatever variation we put out there, it's still about owning an equity stake or loaning your money to someone. Access to alternative investments, IMHO, is only important if that's the business you want to be in. If you like spending your time researching, calling, explaining, tracking, etc those kind of things, knock yourself out. I don't. I think clients are more concerned with what we do not how we do it. They're much more concerned with retiring, college, weddings, and estate planning than learning about a new product from me. At least that's what I've found with my clients. Would it be helpful for that one prospect or client out there that is, I'll say bored, with the traditional approach to have something new and exciting in my back pocket? Maybe. But I'm not going to switch firms because Jones has a traditional investing approach. Would it be great to control my clients accounts? Absolutely. Of course I could only buy fixed annuities for them and I could do that all day long. I could buy ETFs and not have to worry about money managers at all. BTW, Wash Mutual and Growth Fund are team managed. Just FYI in case you forgot. [/quote]Spiff, I used to be with you on the stocks v. bonds theme. Since then I have come to the realization the portfolios are less volatile with commodities and real estate components in them. If that makes the clients more likely to stay with the portfolios we put in place for them, it serves THE CLIENT very well.
My RL trained me to believe that mid and small cap stock funds were unnecessary as well. I have since come to the realization that he was wrong. Ignoring multiple asset classes serves the advisor well more so than THE CLIENT. (i.e. it's too hard to keep track of all that stuff).
[/quote] Your RL must have had his head in the sand. I've personally never heard anyone from Jones tell me that there are certain asset classes that should be ignored. My guess is along with the conversation with your RL about small and mid caps, he then told you that you should only sell American Funds for the rest of your career. Thus the reason small and mid caps aren't necessary. It might work for his office, but not mine. I agree with you on the real estate and commodities. Jones does a very good job on the core investments, but really doesn't talk much about the satellites. Until Advisory Solutions when they built into their "Plus" models some of those asset classes if you wanted something other than what is one the Morningstar boxes, you were on your own. Fortunately for me we had some great wholesalers early in my career who saw things a little differently than Jones does. My Goldman rep was the one who started talking about a more complete portfolio than stocks vs bonds.
Then get them to their goals quicker. You're not going to find opportunties with global infrastructure, ChIndia, base metals, communication & technology inside American funds or Advisory Solutions. You can buy ETF's all you want in regular brokerage accounts but will clients be ok with paying commissions on every trade? How can you possibly do whats best for a client if you can't use fee-based accounts that allow you to actually pick the investments. Your fee based model is basically a retirement lifecycle mutual fund. - http://adviser.americanfunds.com/funds/details/nwf.htm?shareClassTypeId=0 I posted this link for you from the American Funds website. It's a fund called New World. I think it actually covers all of the things you mention above. I could post a couple of others like New Economy or Small Cap World, but I think that would be overkill. As far as Advisory Solutions goes, I can use not only New World, but I can also use a couple of commodity strategy funds, some real estate funds, and some other emerging markets funds. Now, what I can't do is put more than a certain percentage of my client's assets into those funds. But, I can be as tactical as I choose to be with those assets. What I can't do is overweight more than 25% in any fund. Not that I would, but the restrictions are there in case I got a wild hair. You can keep telling people that it's a retirement lifecyle mutual fund, but you'd be incorrect. For many reasons I won't go into here. [quote=Spaceman Spiff]Would it be helpful for that one prospect or client out there that is, I'll say bored, with the traditional approach to have something new and exciting in my back pocket? Maybe. But I'm not going to switch firms because Jones has a traditional investing approach. [/quote] Buy and hold is for losers. It's the lazy way to invest and over the past 10 years hasn't worked. Its for investors and investment professionals that don't want to do the research necessary to find the tactical opportunities that will get the extra couple percent per year that will help the clients goals be reached. No, buy and forget is for losers. I see that all the time. "Advisors" put together an initial group of mutual funds or other investments and just let them run. No rebalancing, no regular due diligence, nothing. It is a lazy way to invest. I agree with you. I don't have any real issues with "tactical" investing. But you're still trying to look into your crystal ball and figure out what's right around the corner. There are some folks who can pull that off and maybe you're one of them. Most people are going to get smoked making sector bets at one point or another. Proper asset allocation, proper rebalancing, proper due diligence on the money managers you use, and finding the correct risk tolerance for your client, IMHO, is perfect for the vast majority of investors out there. From my point of view, I have to be right one time. That's when the portfolio is originally constructed. Get those things I mentioned above right at the beginning and you should be fine with the right kind of reviews along the way. In your model you have to be right all the time. You have to be right on the tactical move, the specific investment, the timing, your interpretation of the data. Unless you have your CFA or something similar getting all of those things right is going to be challenging. Not to mention time consuming. [quote=Spaceman Spiff]Would it be great to control my clients accounts? Absolutely. Of course I could only buy fixed annuities for them and I could do that all day long. I could buy ETFs and not have to worry about money managers at all. BTW, Wash Mutual and Growth Fund are team managed. Just FYI in case you forgot. [/quote] I meant for it to mean "control how the clients year-end statement looks, as far as the bottom line goes". You know why Edward Jones wants you to use the buy and hold approach? Because they don't want you doing actual research that will make you more knowledgable because it will take away time for you to go knock on doors. The clients you got 6 months ago are suffering from your lack of knowledge so you can have a few hours extra each day to get your quota of contacts. If you simply do a great job of getting superior performance then you'll get enough referrals to keep you from needing to knock all day. The company doesn't get a higher profit from you knowing actual market tactics, they get a higher profit by you knocking 8 hours a day. THE COMPANY gets more. But its YOUR business!! [/quote] See, I can't disagree with you more. You have so many contradictions in the paragraph that I don't even know where to start. Does EDJ want us to knock on doors? Yes - to grow our businesses. Does EDJ want us all to become analysts? - No, not until our business is mature enough. And even then I think they'd rather us become CFPs than CFAs. Does EDJ profit from me knocking on doors? - Yes - I get new clients, they make trades or set up new accounts, the firm makes money. Is it ONLY EDJ that profits from that? No - I get commission dollars from my doorknocking. Does EDJ want me to only get new clients from doorknocking? - No - they don't care where they come from. They're OK with referrals, you know. NONE of my clients are suffering over the last 6 months. In fact they're all up quite a bit. In hindsight I should have moved all of my assets to small, mid, emerging markets, and high yield bonds. However, that's not the risk tolerance my clients have. So, we stuck with what's comfortable to them and didn't change the strategy based on the market. Will EDJ profit more if I find a way to grow my client's assets faster? - Yes. From many different sources. Just out of curiosity, how do you quantify superior performance? How do you quantify that with your clients? Do you compare your approach to some benchmark? How do you know that your approach provides superior returns to mine?[quote=Spaceman Spiff] I think clients are more concerned with what we do not how we do it. They’re much more concerned with retiring, college, weddings, and estate planning than learning about a new product from me. At least that’s what I’ve found with my clients.
BTW, I talked to someone from my old Region at Edward Jones yesterday. Last week, 2 Seg 5’s jumped to LPL!!! I am glad for them, both great guys. They will do well. The reason that more people don’t jump is the fact that they are scared to. They don’t have access to the information that this forum provides. I, for one, am thankful for hearing both sides and allowing me to make up my mind rather than just hearing 1 side( EDJ) and trying to make up my mind. Thanks.
Spiffy,
You're going to get blasted for this one: "NONE of my clients are suffering over the last 6 months. In fact they're all up quite a bit. In hindsight I should have moved all of my assets to small, mid, emerging markets, and high yield bonds. However, that's not the risk tolerance my clients have. So, we stuck with what's comfortable to them and didn't change the strategy based on the market. "Seriously? You really believe that's true? You know how I found these forums? Through the EDJ intranet. I don't believe it has anything to do with being scared. I think it has more to do with being comfortable.BTW, I talked to someone from my old Region at Edward Jones yesterday. Last week, 2 Seg 5’s jumped to LPL!!! I am glad for them, both great guys. They will do well. The reason that more people don’t jump is the fact that they are scared to. They don’t have access to the information that this forum provides. I, for one, am thankful for hearing both sides and allowing me to make up my mind rather than just hearing 1 side( EDJ) and trying to make up my mind. Thanks.
[quote=uwec1986]Spiffy,
You're going to get blasted for this one: "NONE of my clients are suffering over the last 6 months. In fact they're all up quite a bit. In hindsight I should have moved all of my assets to small, mid, emerging markets, and high yield bonds. However, that's not the risk tolerance my clients have. So, we stuck with what's comfortable to them and didn't change the strategy based on the market. "[/quote] So, how come you didn't blast me? You obviously think that I'm wrong, so why don't you tell me where the erroneous statements are?[quote=Spaceman Spiff]"NONE of my clients are suffering over the last 6 months. In fact they’re all up quite a bit. In hindsight I should have moved all of my assets to small, mid, emerging markets, and high yield bonds. However, that’s not the risk tolerance my clients have. So, we stuck with what’s comfortable to them and didn’t change the strategy based on the market. "
[/quote] This will probably hurt Spiffy more than anything...but I approve of this message.Spiff
I hope none of your clients were hurt the last six months as most markets are up 30-60%. The real question is how did they hold up the previous six months?Spiff,
I'll try to hit on all your points w/out quoting the post since that thread has already gotten long enough. I think one of the important parts of investing and allocation is being able to control the amount of a certain investment goes in the clients account. I don't want a fund manager telling what % is going to be in base metals. I want to be able to control that. I also want to control the areas that the client doesn't invest in. Maybe I want him in 10% emerging market debt, but I don't want 60% of that amount be in Russia. I can't make that change for him, I'm at the mercy of the fund manager. Or I find a fund like New World that is getting my client exposure to commodities but also has exposure to more utilities than I want the client having. I would basically be a middle-man with my client. "Mr. Client, please roll your 401(k) over to me so I can then pass it on to some other guys to manage." This works w/SMA's because they aren't a diversified mix of sectors. Tactical investing isn't looking into a crystal ball and dressing up like Miss Cleo. Its taking the information that is given to us and translating it into educated investing. "Ok, so the U.S. and developed Europe's governements are riddled in debt right now, while countries like Brazil, China and India are flush with more cash than we could know what to do with. Maybe they would be a smart place to put a few extra bucks in. 6 months from now, we'll take another look at the situtation and see if we need to scale back." Or "The rise in oil prices lately has been almost solely due to the dropping of the dollar. Maybe we need to scale back our oil exposure because the dollar can't keep dropping forever." Being a doorknocker and middleman for our clients money is not what they want. Talking about dreams and goals are all fine and dandy when we're telling them "you need to earn 8% over the next 10 years to 100% fund little Sammy's college. In the last 80 years the Dow has averaged 8%. As long as we follow a theory created by the great Harry Markowitz then you will reach that 8%! Congratulations." But what if they invest with you in 1999 and now its 2009 and their $10,000 contribution is sitting at $10,000. They probably made a couple bucks based off your smart rebalancing over those 10 years, but all those gains went towards making up the original 5.75% A share load. Read the Journal or listen to a few conference calls from the companies you invest with, learn to filter out the propaganda B.S. that some of the guys will stuff down your throat and use that info to your advantage.[quote=Spaceman Spiff][quote=3rdyrp2][quote=Spaceman Spiff]
Then get them to their goals quicker. You're not going to find opportunties with global infrastructure, ChIndia, base metals, communication & technology inside American funds or Advisory Solutions. You can buy ETF's all you want in regular brokerage accounts but will clients be ok with paying commissions on every trade? How can you possibly do whats best for a client if you can't use fee-based accounts that allow you to actually pick the investments. Your fee based model is basically a retirement lifecycle mutual fund. - You can keep telling people that it's a retirement lifecyle mutual fund, but you'd be incorrect. For many reasons I won't go into here. [/quote] Advisory Solutions is a retirement lifecycle fund. EDJ gives out the % for the aggressive model and you are handcuffed to whatever % they put in Large, mid, small cap, international, bonds, whatever. Then quarterly or whenever they rebalance back to whatever the %'s are supposed to be. Just like if you buy a Fidelity Freedom 2040 fund, they are already weighted based off a pre-determined model, then rebalanced back to that model quarterly or whenever. Maybe Advisory Solutions has more fund families than a lifecycle fund but that doesn't mean its better. It just means those funds have a special revenue sharing agreement with Jones.Seriously? You really believe that's true? You know how I found these forums? Through the EDJ intranet. I don't believe it has anything to do with being scared. I think it has more to do with being comfortable. [/quote] Spiff, You are welcome to your own interpretation but when that is EXACTLY what they tell me, I take it at face value. They tell me they are scared, I believe them. I don't think anyone is comfortable with where they are given the market enviroment over the last 12 months.[quote=noggin]BTW, I talked to someone from my old Region at Edward Jones yesterday. Last week, 2 Seg 5’s jumped to LPL!!! I am glad for them, both great guys. They will do well. The reason that more people don’t jump is the fact that they are scared to. They don’t have access to the information that this forum provides. I, for one, am thankful for hearing both sides and allowing me to make up my mind rather than just hearing 1 side( EDJ) and trying to make up my mind. Thanks.
I’ll just slip in my $0.02…
As far as the "scared" comment.....it's true. Maybe "Scared" isn't the right word, but let's just say "not comfortable or confident enough about what lurks around the corner to do anything about leaving". I think many, many FA's (Jones and elsewhere) would answer "YES" if you asked them if they would like to be transported 1 year into the future when they are indy and everything they wanted to transfer has come over, they are now running their own business, and are earning 75% more net (i.e. from 100K to 175K). Maybe "comfortable" as Spiff said, is also part of it. As far as the Advisory Solutions "Lifecycle fund", I think this is a little bit inaccurate (though I understand the point). Let's just examine for a minute....many RIA firms that I am aware of run model portfolios. Typically there are 4-6 different core models (let's just talk about core, tax-deferred account models), ranging from aggressive to conservative, and sometimes including an all-equity and a "capital preservation" model. Most of them stick to a rather pre-defined asset allocation strategy. They may flex internal allocations at times between asset sub-classes (i.e. Emerging/Developed/Value/Growth/LC/SC, etc.), but for the most part, most firms that I have seen do not run ecclectic tactical models (I did not say NONE) with wild swings between asset classes. Within the Jones models (custom), you only have to stick to the macro-allocations (i.e. Income, G&I, Growth, Aggressive). But you can allocate between large-cap, small cap, emerging, value, growth, etc. however you see fit. There are some limitations - no more than 25% in one fund (reasonable), no more than 10% in any one "niche" investment (real estate, commodities, EM), and there is some limitation on high-yield bond funds (I forget what it is). So this is a little bit limiting, but most of the time most reasonable asset allocations are not allocating much more than that anyway. And sicne we are operating under their RIA umbrella, there is a level of prudence that must be used. I can't imagine going in fron of a panel and explaining why I had my client in 50% commodities when they blew up. And you can use any of the funds you want within their program. Yes, I wish we could utilize non-style box funds (i.e. Global Allocation funds), but there are a lot of damn good funds to choose from, as well as most of the ETF's you would need. As always, not perfect, but far from a "Lifecycle Fund".Why are people not comfortable? How hard is it to leave? It’s the same, EXCEPT better. If you leave in January, you’ll be able to get most of your clients transferred pretty quickly. Get it done!
I don’t get it. What is different? Nothing. You basically just make more money.
I don’t know why people would be scared, or uncomfortable. When you look at your commission screen, do you think, “wow, if it wasn’t for Jones, I wouldn’t have made half of that”?
I’ll tell you what folks, if you aren’t happy at Jones, LEAVE! It is better. There is no reason to stay if you are NOT happy. If you are happy, then wish those who leave the best of luck and get out and start knocking on them doors!
Mo, I am just saying that I know many people that have no idea what the transition would be like. All they hear is how high the ticket charges are, how none of your clients come with you, and how expensive it is to pay for employer FICA (yes, much of this is spewed by Jones). So most of them don’t bother looking any further, as they KNOW what they make NOW, and they are comfortable not changing. Not that it’s RIGHT, it’s just how it is.
And as you might have gathered, I am speaking for others on this...Good post B24 This is about as right on as it gets.
Also on Advisory Solutions, the Jones FA’s are touting two things 1. How much better off their clients are due to re-balancing in the down market, and 2. How much it impacts the adviser’s bottom line. They do not talk about most of the other real benefits of working on an advisory fee, because they do not really understand this isn’t how the rest of the world does it.
This reminds me of an abusive relationship where the abuser says and does whatever they can to undermine, belittle and scare. I don't know if it is a conscious thought process, but it has the same effect.
For those reading this thread... I'll remove some of the mystery--which hopefully removes some of the "fear".
1. Not all of your clients will come with you. The average is around 70-75% of your total assets. Jones will tell you it's less. It's not. I was able to get 92% of all the assets. This was due to proper preparation (about six months--although you can do it half that time) and set up of a new office, taking my BOA with me, etc... 2. Do not underestimate the loyalty your clients have towards you. They are your clients. NOT Jones clients! They do business with you because of the value you bring to the table. They like you and they trust you. With that being said...some clients you did not expect to come along with you will and some you might think of as "sure things" will remain at Jones. Some might come 6 months later--although the bulk will come over right away. 3. Preparation is the key. That will determine whether you are able to bring 60% or 90%. Most FA's prepare--but some just are more creative and more organized than others. Talk to others who have left before you. Most will be glad to help you develop an action plan. 4. The payout facts: At RJ (which is not the highest payout for indy--but was the closest thing to Jones I could find as far as strong compliance, great back office support etc..) after ticket charges, technology fees, E&O, etc... I average about an 80% payout. From that 80%, I then pay my rent, utilities, staff people (I have two--but one works 20 hours per week) etc... My net/net as it's often called averages around 65%. At Jones during good bonus periods, I would average around 45-50%. During little or no bonus periods, it was closer to 35-38%. On average, it's about a 20-25% higher net/net payout. (and I'm leaving out RJ deferred comp ((which is free to me--as well as stock options)) likewise, I am leaving out the Jones profit sharing plan). So, for me if I did 900k this year, I take home about 180k-200k MORE at RJ versus Jones. Now, If your doing less production, that number will go down; however, your overhead will also be less. Use the 80% figure to start as it's fairly accurate for everyone. So, if your doing 500k gross, you will end up with close to 400k net from Raymond James. From that, you pay all of your personal office bills. Hope that makes sense. Remember, you are running a business and deciding which expenses are worthwhile and which ones are not--is entirely up to you. Then again--if you are coming from Jones, you probably already know a great deal about what your overhead might be. Hope this helps shed some light on what some of the costs might be and you can apply these numbers to your own practice. ps. I will add that going independent after spending a decade at Jones was easily the best business decision I have ever made. ZACKOHe speaketh the truth. Enough said.
[quote=zacko]
For those reading this thread... I'll remove some of the mystery--which hopefully removes some of the "fear".
1. Not all of your clients will come with you. The average is around 70-75% of your total assets. Jones will tell you it's less. It's not. I was able to get 92% of all the assets. This was due to proper preparation (about six months--although you can do it half that time) and set up of a new office, taking my BOA with me, etc... 2. Do not underestimate the loyalty your clients have towards you. They are your clients. NOT Jones clients! They do business with you because of the value you bring to the table. They like you and they trust you. With that being said...some clients you did not expect to come along with you will and some you might think of as "sure things" will remain at Jones. Some might come 6 months later--although the bulk will come over right away. 3. Preparation is the key. That will determine whether you are able to bring 60% or 90%. Most FA's prepare--but some just are more creative and more organized than others. Talk to others who have left before you. Most will be glad to help you develop an action plan. 4. The payout facts: At RJ (which is not the highest payout for indy--but was the closest thing to Jones I could find as far as strong compliance, great back office support etc..) after ticket charges, technology fees, E&O, etc... I average about an 80% payout. From that 80%, I then pay my rent, utilities, staff people (I have two--but one works 20 hours per week) etc... My net/net as it's often called averages around 65%. At Jones during good bonus periods, I would average around 45-50%. During little or no bonus periods, it was closer to 35-38%. On average, it's about a 20-25% higher net/net payout. (and I'm leaving out RJ deferred comp ((which is free to me--as well as stock options)) likewise, I am leaving out the Jones profit sharing plan). So, for me if I did 900k this year, I take home about 180k-200k MORE at RJ versus Jones. Now, If your doing less production, that number will go down; however, your overhead will also be less. Use the 80% figure to start as it's fairly accurate for everyone. So, if your doing 500k gross, you will end up with close to 400k net from Raymond James. From that, you pay all of your personal office bills. Hope that makes sense. Remember, you are running a business and deciding which expenses are worthwhile and which ones are not--is entirely up to you. Then again--if you are coming from Jones, you probably already know a great deal about what your overhead might be. Hope this helps shed some light on what some of the costs might be and you can apply these numbers to your own practice. ps. I will add that going independent after spending a decade at Jones was easily the best business decision I have ever made. ZACKO [/quote] That's crap. I'll bet RJ doesn't send you your print cartridges automatically when they are running low.WHATEVER. Does it matter? Is Zacko, BigCheese, Uwec saying anything newsworthy that someone contemplating leaving Jones hadn’t thought of already?
An awful lot of pixels wasted, seems to me. However, I'd agree with Luv to this extent: enough has been said on this topic. As Jimbo says ... time to get back to work.[quote=LockEDJ]WHATEVER. Does it matter? Is Zacko, BigCheese, Uwec saying anything newsworthy that someone contemplating leaving Jones hadn’t thought of already?
An awful lot of pixels wasted, seems to me. However, I'd agree with Luv to this extent: enough has been said on this topic. As Jimbo says ... time to get back to work. [/quote] LockEDJ, It must still be news to the EJ folks...because they are still there!Really?? It's been years since I have posted on the topic.
I'm just happy to help folks put down the glass of kool-aid and have an independent thought.I enjoy these threads but at times I’m trying to figure out what the debate is. Everything Zacko says is right on, and is not exaggerated in the least. I, too, will say that leaving Jones after about 7 years was the best move I could have ever made, and though I wasn’t in a position to do so any sooner, had I been, I would say I wish I would have done so sooner!
let’s end this thread, it’s so dead.
Well the truth is when you’re on the fence at Jones you are constantly second guessing yourself. It’s important to keep a steady diet of the truth running on these forums as those considering the jump need a reminder as to why they’re making the right decision.
Are you suggesting that those EDJ supporters aren't telling the truth?
I believe that Spiff doesn't feel he's inflating the truth. In fact he has admitted that part of his gig is to continue to see if he can get our goats by baiting us. What a waste of pixels as LOCKED put it. I believe Spears hit the nail on the head. It's not worth it anymore to continue the dialogue. Big Cheese, foot, is done trying to be the balance that is so lacking IMO. It just isn't productive and frankly I should have realized it long ago. Zacko, Luv, Uwec, good luck if you continue. It's too bad that this forum has sunk to this. Years ago when I started there was real value to participating.Steady diet of truth might be the most difficult thing for a lot of folks. It’s a fact that independant advisors get a higher payout than wirehouse or regional advisors. It’s not a fact that Jones in particular is an evil company who is trying to screw everyone out of their hard earned money. What typically happens in these conversations is that “truth” morphs more into personal opinion or preference.
When I made my move 6 plus years ago, this forum was very helpful to me. I recall back then-- talking with others who had made the leap to independence before me. They helped give me the confidence and understanding that helped me make “my move”.
I hope all of you understand that I am therefore happy to give back. This is my reason for participating in this forum. My intention is not to bash Jones (although it is fun and I sometimes cannot contain myself) We can get product information everywhere, we can get sales ideas from just about anywhere--however, where else can a Jones broker openly ask questions and get so many responses from competing views? The latest Jones regional meeting? His regional leader? Of course not.... The Jones FA is kept in the dark more than any financial advisor at any firm. Underneath the opinions and the mudslinging, there have been truths revealed in this forum which have made a difference in the careers of of many people. I know this to be true as I have talked to some of you in person and even more on the phone. Being happy in your workplace and knowing you have it pretty darn good is truly a great joy. ZACKOSocrates said, "An unexamined life is not worth living." This is true no matter where you work or what you do. You put additional risk, time and effort into your business as an independent in order to make the money you do. Is your time worth that money? Maybe but not necessarily. The juice isn't always worth the squeeze, regardless of what you say. For me, it may well be at some day. But be advised that the additional time spent balancing my books might just as well be spent ... being with my children, volunteering my time at a church, or simply spending more time prospecting. But that said, let me examine my own life. You examine yours.Well the truth is … you are constantly second guessing yourself. It’s important to keep a steady diet of the truth running on these forums as those considering the jump need a reminder as to why they’re making the right decision.
Socrates said, "An unexamined life is not worth living." This is true no matter where you work or what you do. You put additional risk, time and effort into your business as an independent in order to make the money you do. Is your time worth that money? Maybe but not necessarily. The juice isn't always worth the squeeze, regardless of what you say. For me, it may well be at some day. But be advised that the additional time spent balancing my books might just as well be spent ... being with my children, volunteering my time at a church, or simply spending more time prospecting. But that said, let me examine my own life. You examine yours.[/quote][quote=LuvIndy]Well the truth is … you are constantly second guessing yourself. It’s important to keep a steady diet of the truth running on these forums as those considering the jump need a reminder as to why they’re making the right decision.
I spend more time with my family than I did when I was at Jones, and make more money.
[quote=Moraen]
[quote=LockEDJ][quote=LuvIndy]Well the truth is … you are constantly second guessing yourself. It’s important to keep a steady diet of the truth running on these forums as those considering the jump need a reminder as to why they’re making the right decision. [/quote]
Socrates said, “An unexamined life is not worth living.” This is true no matter where you work or what you do. You put additional risk, time and effort into your business as an independent in order to make the money you do.
Is your time worth that money? Maybe but not necessarily. The juice isn’t always worth the squeeze, regardless of what you say. For me, it may well be at some day. But be advised that the additional time spent balancing my books might just as well be spent … being with my children, volunteering my time at a church, or simply spending more time prospecting.
But that said, let me examine my own life. You examine yours.[/quote]I spend more time with my family than I did when I was at Jones, and make more money.[/quote]
Do ya count this forum your family? 1000+ posts in under a year probably does not include time with ya family.
While Moraen may disagree with your opinion, I’m sure that his day, and mine, just got a little brighter by seeing your post. On behalf of the rest of RegRep, thank you.
Or you could hire an accountant and a bookkeeper to balance those books.
Some guys like fat chicks. I know you have heard the saying that some guy some where is tired of the girl they are with. So why do they stay? Because it is their perception that it is more difficult or expensive (“cheaper to keep her”) to move then deal with the current situation if they are unhappy at all. Like I said, some guys like fat chicks. Just accept it and move on?
[quote=DD] [quote=Moraen]
[quote=LockEDJ][quote=LuvIndy]Well the truth is … you are constantly second guessing yourself. It’s important to keep a steady diet of the truth running on these forums as those considering the jump need a reminder as to why they’re making the right decision. [/quote]
Socrates said, “An unexamined life is not worth living.” This is true no matter where you work or what you do. You put additional risk, time and effort into your business as an independent in order to make the money you do.
Is your time worth that money? Maybe but not necessarily. The juice isn’t always worth the squeeze, regardless of what you say. For me, it may well be at some day. But be advised that the additional time spent balancing my books might just as well be spent … being with my children, volunteering my time at a church, or simply spending more time prospecting.
But that said, let me examine my own life. You examine yours.[/quote]I spend more time with my family than I did when I was at Jones, and make more money.[/quote]
Do ya count this forum your family? 1000+ posts in under a year probably does not include time with ya family.[/quote]
I’m sorry I didn’t hear what you said, I was too busy staring.
Thank you. God bless you and may you live a long and prosperous life.
P.S. It took me 15 seconds to type that.
That means if I had posted 2000 posts in the last year, I would have spent 8.3 hours posting.
8.3 hours for the entire year. That means I have spent .091% of my time on these boards.
Sorry, I won't play. You and I both know that the reason you spend more time with your family today is far more correlated to your time in the business than where you work. I'm sure every FA that started when you did spends more time with their family than they used to. You earn more because you 1> Risk more, and 2>Take on the responsibility to work on things you don't have to work on at Jones. Both your points are flawed, but of course you knew that when you wrote it.
I spend more time with my family than I did when I was at Jones, and make more money.
Sorry, I won't play. You and I both know that the reason you spend more time with your family today is far more correlated to your time in the business than where you work. I'm sure every FA that started when you did spends more time with their family than they used to. You earn more because you 1> Risk more, and 2>Take on the responsibility to work on things you don't have to work on at Jones. Both your points are flawed, but of course you knew that when you wrote it.[/quote][quote=Moraen]
I spend more time with my family than I did when I was at Jones, and make more money.
Lock - outsourcing the things Jones does for you is cheaper than having them do it for you. That's just a fact.
Where is the risk? I have the same amount of risk on my own that I have at Jones. What additional risk am I taking?
Edward Jones benevolent protection? Having experienced it, it's not something that I miss.
But, you are correct about time in the business for sure.
Zacko is right on in terms of his “giving back” message. It too is what keeps me coming back here. That and I agree as well I get some great laughs when I see the things that are so JONES that you can smell it a mile away. There are all kinds of peeps in the Indy world, but fairly consistently the ones that used to be at Jones are a cut above the rest.
Lock- I spend more time at home now than I used to because I don’t have meetings any more. If you just spend the days you used to be at meetings with Jones at home that’s another 4-5 days a year, if not more.
I def work less than I did when at Jones--last year and first 3 months of this year being the exception--due to market conditions.
To do payroll and pay bills, it takes me about a total of an hour per month...maybe slightly more if I am paying my quarterly payments to the IRS. Def worth the extra 150-200k I make. In fact, since being indy--in the six years I have probably netted close to one million dollars more than if I were at Jones. That is a staggering number to me and it's made a big difference in how I live my life. Overall, I have much more free time. They key is knowing how to run your business and when it's ok to back off some. That's true whether at Jones or at your very own indy office. Have a nice weekend all. It's 2pm -and I'm leaving for the day ZACKOWhere is the risk? Let’s assume that for five or six months your (brand new) office isn’t profitable. Happens, doesn’t it? All the time.
I go out on my own ... let's say in March, right after my contract ends. The market contracts. My rent's still due, I still have to pay for my software, I still have to pay my monthly EO. Your proximity to success blinds you to this, I'm sure. Whether there is some arbitrage between what it would cost you to do things and Jones to do things, I won't argue.[quote=LockEDJ]Where is the risk? Let’s assume that for five or six months your (brand new) office isn’t profitable. Happens, doesn’t it? All the time.
I go out on my own ... let's say in March, right after my contract ends. The market contracts. My rent's still due, I still have to pay for my software, I still have to pay my monthly EO. Your proximity to success blinds you to this, I'm sure. Whether there is some arbitrage between what it would cost you to do things and Jones to do things, I won't argue. [/quote]If you aren't producing enough after three years or so, doesn't Jones fire you? I don't have the risk of getting fired.
I guess to each his own. I never saw it as a risk to leave. Seemed more risky to stay, especially with my loud mouth.
OK - well, the only "meetings" I have are with my clients. I don't "volunteer" now for the good of the region and that $hit ain't changing any time soon. Should I stay at Jones, my business plan is pretty simple. Get 200, $100000 households all in AdSol at 1.35%. Meet with them quarterly, in 45 minute intervals; start work at 9 and leave by 3. End the workweek on Tuesday at 3 PM. Allow my BOA to work 40 hours a week. Make $110K a year and go on two trips a year. Let Jones pay the heat, make sure the toilets are cleaned, advertise on national TV, pay most of the cost of my seminars. If I go Indy, I can come close ... but the minimum work level goes much, much higher especially if I want an office or heaven forbid someone to man the office on Wednesdays, Thursdays and Fridays while I'm living my life.Lock- I spend more time at home now than I used to because I don’t have meetings any more. If you just spend the days you used to be at meetings with Jones at home that’s another 4-5 days a year, if not more.
So like zacko, I'll give back. Don't accept the hype pumped by indy's - and I say that as someone that in all likelihood will go that route. You can live the simplest, easiest life possible at Jones. You only need 200 accounts. Get one a week for the next [edit: four]years, and never work again in your life.
So Lock, I’m guessing you’re a big fan of Science Fiction…
I'm just working towards my dream, bud. I started on this vision 2 months ago and I'm 8% down the road. The sales I've booked for December and January put me already at 15%. Tell you what; I've shared my goals and how I'll get there. You tell me your goals and how you'll get there, and we'll compare notes in a while. Love to hear your vision.
But in the meantime, as I know you're a great Jones basher and indy path lover, please do tell how you can achieve the lifestyle above in the independent world. Because I love just straight fiction.
My GDC is $270K on the scenario above; using your payout today I’m at $135K - but let’s use the higher payout structure. Admin costs in my area run an easy $30K, plus benefits. Lets say $40K. Renting a smaller office (600 square feet), about $1800 including heat in my northern hemisphere town.
I haven’t paid for anything beyond opening the door, and I’m at less than $120K. Haven’t gone on a trip, need to make sure my books balance. I imagine you pay for technology costs, EO. And that’s being paid at the higher rate - at the lower payout of 50% I cannot afford the administrator. It’s really a needless exercise.
Ice - you’re preaching to the choir. I think I’ve got about the strongest offer I could imagine out there, and I checked everyone. Made my DD trips, contacted my friends at LPL, at banks, spoken with the micro-indy. The point I was trying to make is that dumbed down, Jones makes the most risk-less opportunity.
It’s not even close. When you factor in potential loss of client base in a transition, factor in lost productivity in a transition - running an Indy doesn’t hold a candle to the scenario above.
Locked - just a couple of observations; you should not need a FT assistant. My BOA works 30-35 hours and there are two of us in my office. The reason is we are very self-sufficient. If she worked 20 hours just for me, that would still be fine. Hire someone PT (if at all), no benefits. As far as rent - $36/sq.ft.? You’re not looking hard enough. Don’t be fooled into thinking you have to be on the town square. Unless you are IN a major city, I can’t imagine paying more than $18-20/sq.ft.
Lock, I believe strongly prospective clients are much more willing to come to me as an Indy than they were as Jones guy. Ask your clients how many of them think they have Edward Jones products (regardless of what you’ve told them) and you’ll be amazed. I know I was when I left.
LuvIndy - I don't believe I'm flattering myself in saying my clients are loyal, but I plan for the worst case scenario.
Early in my career, I worked towards what I thought would annuitize my income, Jones-style. Those strategies (like CMO's feeding AIVSX/AMECX, or short term ladders in $5K increments, or DCAs into a diffuse group of mf families) simply don't translate very well into the Indy platform. So today I'm building an ark of AdSol's, that truly reflect my own take on the world and that do translate. But it doesn't mean attrition won't exist. Regards B24, heat alone in my town costs $400 a month for any reasonable space. There isn't a "town square", just the town (LOL). There's approximately 10 office spaces for rent; it's not too hard to exhaust the possibilities! But realistically, neither your point nor Luv's nor Ice's challenges the overriding point: For a simple platform, such as I've laid out, you cannot beat Edward Jones. It can't, because you have to account for lost productivity, lost accounts, increased effort/initial expense. If you can comfortably live on $100-120K a year, don't want to take on risk, want to work around 10 hours a week, have someone else to rely on when you're on vacations or simply not in the office. Not every strategy automatically works for independents, just because the payout can be higher. That's the original point I was making, by saying that you need to examine your own life and your goals.Lock - I admire what you are doing. Bravo.
Lock - There is more risk in working for a firm. Hands down. You can be fired. If you own your own, you can’t. Simple as that.
What happens if Jones one day decides to slice anybody with three years of service and grossing less than 400k (not likely, but possible)? How will you transition then, with no prep?
The risk of being a W-2 employee is ALWAYS higher than working for yourself. Our profession is set-up to be independent.
C'mon Morean. We're both well aware that EJ's "carries" underperforming FA's, often for as long as a year. There's one guy that's still with us that's been averaging $18 a month in commissions ... for six months.
What happens at CIR, or LPL? When the bills start piling up to pay EO/tech/etc, do they miraculously fail to run your credit card for those bills? The very core meaning of independent is they have no vested interest in making sure I make it. I'm just an income stream to them. Jones may indeed fire FA's ... but not before extensively giving them one-on-one assistance and making every possible effort to insure their success. Their concern, their vested interest in my success makes a difference between my world and yours. And frankly, it's why working at Jones is worth a premium to your world. To me, today. Because being independent, by definition, means I don't want to be part of a group of 12000 and get the support that that brings. **** I'm sure by now, you've read the RR rankings. What struck me wasn't how well Jones did (a foregone conclusion), but how self-immolating the competition responses were. Wow. If you hated it that bad, leave.This is quite the curious statement, when the fact of the matter is that until recently most RRs work for firms and in particular wirehouses. Far, far more AUM are accredited to the wirehouses than to independents, no? At least, that's my understanding of the numbers. The Internet, in it's many forms, is changing access to things like information and technology and allowing the Independent model to finally compete against wirehouses. While the future may be, I don't see how history is even marginally on your side on this.Our profession is set-up to be independent.
I agree to an extent. There are just as many people that like the comfort of a big firm vs. what they perceive as a "lone wolf". Yes, it is simply perception, but unfortunately, that's reality in some people's eyes. I have had a few people transfer to me (completely unsolicited) from a friend that left Jones to go with Cambridge. Despite me telling them that their investments were just as safe there (I have no real interest in taking his clients), they were too nervous about it. And he was not going to change a thing about their investments (yes, AF), nor did I. I have also had two people come to me unsolicited over the past 6 months that told me they just looked me up because their parents, uncle, friend, etc. use Edward Jones and only say good things about them. I also think Indy's get a little bad rap sometimes due to the whole "Madoff effect". You hear too many stories about rogue brokers embezzling/stealing from clients, and moree often than not, they are indy brokers. On the other hand, there are a lot of people that simply don't trust the motives of "branded" brokerage firms. Despite firms' best efforts, everyone knows they are motivated by commissions (fees, etc.), and not really concerned with the clients, per se (not to say the individual FA's are at fault). People also worry about being stuffed with "firm sponsored" investments, underwritten IPO's, etc. So I think it works both ways. At the end of the day though, I think a well-run indy firm has a better shot at marketing than some of the branded firms these days. And considering you only need a fraction of the clients as an indy that you would at a captive firm, the cards are stacked in your favor.Lock, I believe strongly prospective clients are much more willing to come to me as an Indy than they were as Jones guy. Ask your clients how many of them think they have Edward Jones products (regardless of what you’ve told them) and you’ll be amazed. I know I was when I left.
[quote=B24]
I also think Indy's get a little bad rap sometimes due to the whole "Madoff effect". You hear too many stories about rogue brokers embezzling/stealing from clients, and moree often than not, they are indy brokers...[/quote] Funny to mention this; just last week, a very loyal client of mine literally asked me ... "how do I know you're not just like this Madoff guy?". I don't know that any of us are free from such a paintbrush, ever. Somebody, somewhere is wondering that even when they don't ask.[quote=Moraen] Our profession is set-up to be independent.
This is quite the curious statement, when the fact of the matter is that until recently most RRs work for firms and in particular wirehouses. Far, far more AUM are accredited to the wirehouses than to independents, no?
At least, that’s my understanding of the numbers. The Internet, in it’s many forms, is changing access to things like information and technology and allowing the Independent model to finally compete against wirehouses.
While the future may be, I don’t see how history is even marginally on your side on this.[/quote]
I think our profession is set-up to be independent because of how we work with our clients. Much like attys or CPAs.
Our value is in our knowledge, not in products. For instance, a drug rep can’t go independent. Or any other factor of production that is a driver of revenue.
All of the firms tout how “you make your own schedule” sort of thing.
Hell, Jones is even quasi-independent.
As for the other things. Yes, Jones does carry the losers. But for how long. What happens when they decide to let the chaff loose? That is always a possibility. Or cut your payout? “restructure” your bonuses. All of these things are possibilities that I don’t have to contend with.
It’s more risk-averse to be indy. E & O - that’s a joke right? If anybody is paying more than $2k a year for E & O they are getting robbed.
Technology, etc is all a lot cheaper, even with Jones’ economies of scale or any other firm (I’m not singling out Jones here).
Office space can be found quite easily in my area (I know your area may be different, so I won’t comment on your personal situation), but it is more likely that it most areas, it is not difficult to find nice office space for pretty cheap rent.
And the risk of clients not coming over? The ones that stay at Jones (or the wire) - good riddance. They weren’t “your” clients anyway if they stayed (that said, I’ve had people come over a year later - decided they were in fact my clients).
I don’t think the argument that it is riskier to be independent holds a whole lot of water (I almost said “hole”, and then I would have been outed as Windy). The first few months felt like it. But now… no possible way it is better to be working at another firm.
[quote=LockEDJ] [quote=B24]
Funny to mention this; just last week, a very loyal client of mine literally asked me … “how do I know you’re not just like this Madoff guy?”.
I don’t know that any of us are free from such a paintbrush, ever. Somebody, somewhere is wondering that even when they don’t ask.[/quote]
This is easy to fight.
“Mr. Client, you get two statements. One from my firm and one from where your money actually is. You pay me for “advisory” services. You don’t pay me to keep your money for you. Trust me, you’d be paying me a lot more for that risk.
If the statement I send you doesn’t match up with the one the custodian sends you, well then you know something is fishy, don’t you?”
Zacho, Thanks for starting a great thread and nice job handling the Spacehead. He has teed off on me a few times. Although he denies it I still think he’s a EJ home office troll.
Wire Advisor, Indie, Jones Kool Aid drinker, bank rep, and regional FA, we all have one thing in common - We all have overhead. The difference with independence is control of how your overhead is spent. As an indie, you hire who you want, your vacations aren’t taxed, and you are the decider (to quote GW). I did the math and came to believe the $200k plus UBS kept from me gave me little value. I was paying to much and getting to little. I reached the same conclusion when I left Jones to go to PaineWebber. I left Jones because they wouldn’t let me move my office closer to my home (family obligations required it). The only way I could move was to give up my clients and my resulting profitable office to start from scratch again. So much for Jones being family friendly.
I just want to ask JONES FA’s one question, “Did you do the right thing for the client every time this year?” If you can answer yes to that question then stay at EDJ. I’ve been indy for 3 years now and I can finally say, “I did the right thing for the client, every time this year!” When I was at Jones, I could never say that. I was always looking for the biggest commission, miss breakpoints, etc.
Wow, that's not a violation of FINRA rules...I just want to ask JONES FA’s one question, “Did you do the right thing for the client every time this year?” If you can answer yes to that question then stay at EDJ. I’ve been indy for 3 years now and I can finally say, “I did the right thing for the client, every time this year!” When I was at Jones, I could never say that. I was always looking for the biggest commission, miss breakpoints, etc.
Lock,
If having a 20 to 25 million dollar office is your goal--you might not make the minimum production requirement at some indy firms. Jones would be the better choice since they are paying your rent and for your assistant which consist of the majority of your office overhead. So, you are correct. The breakeven is around 250k with a full time assistant with benefits. And, your sort of in that grey area.
This is a great business to be in when you are succesful. And, I'm not exactly sure why you think getting two taxable trips a year and 100k per year net is actually "succesful". It's a mediocre goal at best and would be considered substandard by many myself included. In fact, I am glad that there are advisors like you out there--because it is less competition for me. Thank you for existing and setting your personal success bar so low.Actually, Zacko (I agree with you), this is one of the reasons Jones is so successful - many of their FA’s are in places where making 100K net is like winning the lottery. One of my training partners lives in an area in the midwest where she is like the only game in town. Her (average sized) house cost her $110K. Her husband works for the local phone co., and has a great pension (he can retire at like 55) and fully-paid benefits. She is making like $100K at Jones (she grosses like 250) and living the dream. Between her and her husband they earn about 140-150K. Funniest part - she was a BOA for like 12 years and was making $8.50/hr. (my BOA makes $18 and has worked for Jones 4 years). So she went from $18K per year to $100K, two trips, 5 times the profit sharing, and profitability bonuses (her office rent is like $450, her BOA makes like $8/hr.).
So we have to put some of this in perspective. This woman (and I like her very much) could NEVER go independant. She is a wonderful person, but she pretty much sells CD's, bonds, and mixes in some American Funds. She would not know the FIRST THING about actually running a business. I am guessing there is a LOT of this across the country. It is one of the really nice things about the firm. It gives a lot of people an opportunity they would have NEVER had in a million years where they are. Just something to think about.Lock - First, I hope you were halfway kidding with your dream scenario back there. Second, if you aren't, I agree with Zacko on this one. You wouldn't be allowed to stay at EDJ forever under that scenario. You wouldn't even be doing Seg 4 numbers, and they're getting to the point that they're not going to let you be a perpetual Seg 3. I'd say $20MM in Advisory is a nice goal for the next 3-5 years, but it shouldn't be the end game. If you're searching for a nice end goal, shoot for 350 of those $100K clients. Sure, you'd have to work an extra day a week, but you'd be at Seg 5, extremely profitable, bonusable, LP eligible, AND taking two trips a year. How much more fun could you have on those off days if you had a little extra jingle in your pocket?
My personal goal would be more like 100 clients with $1MM in AUM with me, half of it in Advisory, half of it in other stuff. $675K from Advisory and maybe another $250-400K from the other stuff. I get my ring with the big sapphire in it and Jones is happy. From that point on I would only take referrals that met my $1MM criteria. Any exceptions (or problem clients) would eventually get booted to my GKNs. If you're going to stay at Jones, at least take advantage of the opportunities that are here. Otherwise, find an indy in town who would let you shack up with him and work your plan there. I think if you kept it basic enough you would have more money. If you have to travel, buy a timeshare.Personally, I think if you worked 2 days a week, clients would start to get annoyed (assuming you did not have a registered partner, just a BOA). Maybe not right away, but eventualyl, the word starts to spread that you’re never in the office. I have picked up two clients like this recently - granted, the woman FA is close to retirement and probably doesn’t care anymore, but the point is, my two clients (they are friends) have told me flat out “we really like her, but she never calls back, and she’s never in the office anymore. We always have to talk to her partner, who we really don’t like at all”.
Honestly, what the hell would you do with 3 days off a week? I guess I actually like work too much to take 3 days off. I can see taking off Fridays, maaaaaybe 2 days, but I would have to have a small client book for that (like 100 clients max)."You wouldn't allowed to stay at EDJ forever" ... this is joke, right? Literally - I mean, I just looked - 76% of my region is not averaging significantly more than $20K a month.
While Weddle's made noises about getting everyone to Seg 4, the goal remains being profitable in your office. As a sub-36 month/Seg 2 guy I'm generating around a 10% profit. At $20K, my location margin exceeds 45% so I don't think I'm in too much trouble there. Should the time exist where I needed to make more, my Jones business plan certainly allows me enough space to achieve it. Between yourself and Zacko, feel free to maintain a superior attitude. I neither need to add to Space's LP offerings nor live in Zacko's house. Personally, I think it's sad you both seem to value your work so much that you can't see the importance of a 10 hour work week. I value my relationships with my clients, and my time with my wife and my family. I build my business because I'm a competitive mfer, and so all I've ever known is growth. I will ultimately cap that growth; spend significant time with those clients I want; and cherish my family.…Honestly, what the hell would you do with 3 days off a week? …
Increase my level of activity on Reg Rep forums, of course …
I can only recall having Ice’s scenario occur twice in my career. I don’t think I could handle it with a 100 clients/households…
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Reasons to leave Jones besides the money:1. No one calls you when you have a good month, because no one cares
2. No one calls you when you have a bad month, because no one cares 3. When someone comes to you to add $5,000 to their portfolio, and they don’t have Roth IRAs, you only open one of them, because you don’t care how many accounts you open in a month, and no one else does either, and when one account serves the need, one account is all you open. 4. You can send an e-mail to a friend at another firm without wondering who is reading it 5. You can call a friend at another firm on your office phone without wondering who might look at the phone bill at the end of the month. 6. You can decide which vendor events to attend without considering “should I be seen there” or “should I NOT be seen there.” 7. You can transfer in client assets and charge an advisory fee and not worry about selling it by the last Tuesday of the month 8. No incentive to recruit others, unless you want to OSJ them 9. You can buy sports tickets with business funds and go to events with attorneys and accountants that you refer business to, and vice versa, and you enjoy hanging out with them. I should have probably had 10 for a Letterman list. This isn’t supposed to be funny. These are all of the reasons (that I can think of now) that I am happier than I’ve ever been since leaving over three years ago, and none of them have to do with money.
Lock,
I work 30 hours per week and can take time off when I feel like it. I take 3 or 4 vacations per year. I can talk to you this way because I have over a 100 million dollar book and have earned the right to do so.Like I said ... feel free to have a superior attitude towards me. I appreciate the fact that you've worked hard; quite honestly, I do and I value the information that I get from seasoned financial advisors like yourself. Personally, I'd like to think that my value system would prevent me from belittling others, or at the least recognizing when I was defending an unsavory attitude. Maybe I give myself too much credit. And I'll repeat ... it's truly sad that you cannot find the value in a ten hour workweek or for someone that believes that's a great goal. Best of luck to you and I look forward to seeing your posts.…I can talk to you this way…
I'm sure your clients would also appreciate the "value" of your ten hour work week.
Fact is, I enjoy coming to the office at 930AM everyday and leaving at 3:30 or so. Maybe I'll take a few Friday's off here and there. But--there is no way you can run a professional investment office by working ten hours per week. And certainly not at Jones. It's laughable. And, if you have that attitude now--you will never make it. As far as belittling you--it's nothing personal. I just think you sound like an ass.[quote=zacko]
Lock,
I work 30 hours per week and can take time off when I feel like it. I take 3 or 4 vacations per year. I can talk to you this way because I have over a 100 million dollar book and have earned the right to do so.[/quote] Prove it Everyone is a rock star on the internetYou can run a valuable business working 10 hours a week at Jones. I know a guy who only came in on Wednesdays, and worked until noon. Every week. Buie Martin.
You can do it as an indy as well if you hire the right people.
I think you guys are giving Lock a hard time just because he’s positive about Jones, which I don’t think is right.
Lock has contributed quite well to the forum in your absence zacko, and while most here admire what you’ve achieved, it doesn’t make Locks’ accomplishments any less valuable.
That said, Lock - I still think you are missing the boat about being Indy. Apples to apples, it doesn’t make sense to stay at Jones. Ever.
Well, it’s possible to achieve it as an independent … and I don’t think I hide my intentions regarding what I’ll do after my contract ends.
Mostly, I'm mentally posturing here about the 10 hours thing, thinking a bit outloud. Functionally speaking it's my goal to work less, focus on a small group of not-nessarily-high-net worth clients that want my brand of service. I appreciate the other side of the coin. I know what it's like to be driven. I'm just driving hard in a different direction.zacko - Buie is retired now as far as I know. He was traveling in my state. Jones was paying him as a consultant.
The fact of the matter is that it is possible, and Lock could achieve that goal.
Given the level of competition in Southern California a 10 hour work week would not be advisable. What if a competitor bringing that up? This likely would not be a positive conversation for you.
Maybe if you worked 5 days, 2 hours at a time (which defeats the purpose). If you set the tone, clients can work with something reasonable.I’m guessing lock has a cell phone? Heck he might even have one of the fancy ones with e-mail. I’ll go out on a limb here … while he’s sitting by the pool or on the golf course I bet he gets service and could answer it.
I run my business by appointment only. You don't have an appointment I don't see you. However, everyone of my clients has my cell number and knows all calls will be returned by end of day. Lock could run his business the same way and only be in the office 10hrs a week. His clients would never know and as long as he trained his assistant and rewarded her it would stay that way. Make it happen bro! Don't listen to the haters running terrible businesses that require them to be in the office 40hrs per week. Live the dream.[quote=LockEDJ]
"You wouldn't allowed to stay at EDJ forever" ... this is joke, right? Literally - I mean, I just looked - 76% of my region is not averaging significantly more than $20K a month.
While Weddle's made noises about getting everyone to Seg 4, the goal remains being profitable in your office. As a sub-36 month/Seg 2 guy I'm generating around a 10% profit. At $20K, my location margin exceeds 45% so I don't think I'm in too much trouble there. Should the time exist where I needed to make more, my Jones business plan certainly allows me enough space to achieve it. Between yourself and Zacko, feel free to maintain a superior attitude. I neither need to add to Space's LP offerings nor live in Zacko's house. Personally, I think it's sad you both seem to value your work so much that you can't see the importance of a 10 hour work week. I value my relationships with my clients, and my time with my wife and my family. I build my business because I'm a competitive mfer, and so all I've ever known is growth. I will ultimately cap that growth; spend significant time with those clients I want; and cherish my family. [/quote] Please tell me that you aren't equating location margin to profitability while crafting your master plan. If you are, you need to sit down with your mentor and have him explain how your P&L works. If you're still Seg 2, your office isn't profitable. Is it possible that you are THE ONE GUY in the firm that has the lowest rent, BOA salary, and other overhead? Sure. My guess is though, you're not. Just so you know, you won't really be profitable at $20K a month either. Most folks break even somewhere around there. As to your region, if it's like mine, you probably have a bunch of new folks out 5 years and under, with a healthy dose of vets out 7 years plus. I know it doesn't look like a big difference, but the difference between $20K a month and $27K a month in the Jones system is huge. Not just from the dollars in your pocket standpoint either. It's the difference between a mediocre producer who's just keeping himself off the radar screen and a good producer who's living the Jones dream. Raise that bar to $30K and you're a king.Is 144K net now considered a king?
[quote=LockEDJ]
As a sub-36 month/Seg 2 guy I'm generating around a 10% profit. At $20K, my location margin exceeds 45% so I don't think I'm in too much trouble there. Should the time exist where I needed to make more, my Jones business plan certainly allows me enough space to achieve it.
[/quote] 20,000 Gross @ 45% location margin = $9,000 Location margin Gross: 20,000 Deductions Payout (8,000) Tech Fee (1,250) Rent (500) at least BOA (1,500) at least ($9.00/hr) Benefits (1,000) at least (profit sharing, health ins, ER FICA) Other Exp xxxxxx Total Exp (12,250) Margin $7,750 So I am estimating low on everything, and not including any "other" expenses (phone, supplies, licenses, CAM, utilities, etc.). Based on that, you are already short of your 45% margin. How's that work again?The magazine says average production at Jones is $213K, and $41M AUM… I bet that is high considering all the new people they have… My guess would be more around $150-180K and $20-30M AUM
[quote=B24][quote=LockEDJ]
As a sub-36 month/Seg 2 guy I'm generating around a 10% profit. At $20K, my location margin exceeds 45% so I don't think I'm in too much trouble there. Should the time exist where I needed to make more, my Jones business plan certainly allows me enough space to achieve it.
[/quote] 20,000 Gross @ 45% location margin = $9,000 Location margin Gross: 20,000 Deductions Payout (8,000) Tech Fee (1,250) Rent (500) at least BOA (1,500) at least ($9.00/hr) Benefits (1,000) at least (profit sharing, health ins, ER FICA) Other Exp xxxxxx Total Exp (12,250) Margin $7,750 So I am estimating low on everything, and not including any "other" expenses (phone, supplies, licenses, CAM, utilities, etc.). Based on that, you are already short of your 45% margin. How's that work again? [/quote]Maybe he doesn't have a BOA.
Love the hours worked conversation..... I probably work less than any million dollar producer I know. Have two great assistants and like the business, so I enjoy my 30 hours. And NO CLIENTS have my cell phone and I never call the office when I am on vacation. When I turn the key and leave--I am done until I return....period. I enjoy my personal time that much more because I seperate work and play. Also enjoy work more as a result. I could work less and some weeks I actually do. My view is I don't think anyones goal in their first couple of years of business should be to eventually work ten hours per week. The focus should be on building a succesful practice and gathering assets.
It's funny to hear all of you discuss how many hours you would "like" to work. Yes, Lock could achieve that goal as easily as anyone else. I don't know his work ethic or how seriously he takes building a successful investment practice. If you work hard and you work smart--this business is full of wonderful rewards--financial and otherwise. In the first two to three years, it's tough. But, like I have heard a time or two before--if it were easy...everyone would do it.[quote=Squash1]The magazine says average production at Jones is $213K, and $41M AUM… I bet that is high considering all the new people they have… My guess would be more around $150-180K and $20-30M AUM
[/quote] I would estimate around 170-190K. Jones' average production is misleading though. If you exclude all the newbies (well, like half the firm), the average production is probably more like $400K. And the average AUM at the END of 2008 was $37mm (off their financial Statements). Average velocity is probably around 0.5%, which would equate to about $185K production. And since velocity of newbies is usually higher than vets (becuse of so much new money coming in, in relation to total AUM), the average would likely be slightly higher than this. Bottom line is that Jone is a firm of about 6,500 "real" producers. The other 5-6,000 are new or underperformers.Actually, I was just looking at our Financial Statements again. If you include fee-based revenue (AUM fees and 12b-1 revenue), the number is actually about $250K per FA in revenue (actually it was $266K, but that was 2007). Maybe $213K was 2008 numbers. AUM per FA dropped from 48mm in 2007 to 35mm in 2008.
The $185K only includes trade revenue (commissions).I’ve redefined what I call “work” time because I do enjoy my time in the office more now than I used to. I am nearing the point where things are running the way I want them to, and about to hit the breakout point where all additional revenue is just hitting my bottom line (beyond the typical 40% payout level). Like Zacko clients RARELY hear from me out of the office, and definitely do not have my cell phone. Staff is trained to deal with the majority of issues without me. It’s rare that they need to call me for an “emergency”.
Whoever is paying $9 an hour for a BOA should be embarrassed. Are you running a sweatshop or a financial services business?
[quote=Spaceman Spiff]
If you're still Seg 2, your office isn't profitable. [/quote] [quote=B24] How's that work again? [/quote] I could go into a long harangue about my location margin, but either you believe me or not. My location margin, YTD, is nearly 10% of GDC but with what I expect to be a pretty good December, it wouldn't surprise me to hit 12% for the year. I know when I compare myself using the FA Rankings report I'm doing well against my peers, my region and considering service time, nationally. I've run cost-effective businesses before, so I know my way around a bit. Anyway, that's my story and I'm sticking to it.I think Jones has done it's FAs a great disservice by reworking the P&L to make it "friendlier". It more than likely appears on paper that your office is operating at a profit to Jones. A couple of years ago, you'd still be in the red and would be that way until you got to averaging above $15,000 a month or so.
If it were me, I wouldn't be focusing on my location margin YTD. I'd be looking at the Bonus Period To Date and trying to figure out how to get it above $23,000. That in addition to the meeting/exceeding/below standard line on your Performance Chart are really all that you need to be looking at. Do you not care about the bonuses? LP? Profit sharing? All of those things mean I get to retire sooner and not work any hours a week. The higher I can make them, the quicker I get there. I'd rather spend time with a rich happy wife in retirement than with a penny pinching one now.[quote=Spaceman Spiff]
I think Jones has done it’s FAs a great disservice by reworking the P&L to make it “friendlier”. It more than likely appears on paper that your office is operating at a profit to Jones. A couple of years ago, you’d still be in the red and would be that way until you got to averaging above $15,000 a month or so.
If it were me, I wouldn’t be focusing on my location margin YTD. I’d be looking at the Bonus Period To Date and trying to figure out how to get it above $23,000. That in addition to the meeting/exceeding/below standard line on your Performance Chart are really all that you need to be looking at.
Do you not care about the bonuses? LP? Profit sharing? All of those things mean I get to retire sooner and not work any hours a week. The higher I can make them, the quicker I get there. I’d rather spend time with a rich happy wife in retirement than with a penny pinching one now. [/quote]
I’d rather spend my retirement with a rich younger version of my wife. Shut up Spaceman Queef
Spiff-
Regarding the great disservice to FA's, could you highlight for us old ex-Jonesers the new bonus grid. My understanding is that there are more levels (as many as 10 tiers). What is the current bonus %? Is the 23K you are referencing the first tier? Sounds as if they are keeping more of the bonus pool for themselves...It's not really that much different than before. There are now 10 bonus brackets instead of 5. Your bonus is based on location margin instead of profitability. They're generally the same thing, just the terminology is a little different.
How do you figure that the firm is keeping more of the bonus pool for themselves? My comment about the disservice to the firm is that I have heard what Locked says about being profitable from other new FAs. With the P&L the way it was when you were here, you basically had to hit Seg 3 before you showed a positive number on the location gain line. And until you were in the low to mid 20's that number wasn't big enough to even worry about. From what I've heard from newer FAs in our region, they can start seeing positive numbers on their P&L in Seg 2, like Locked is. Jones may be trying to send a more positive message by way of the P&L, but if a lot of folks start to think like Lock is, that he can make it at Jones at $20K a month, we're in trouble.Few things:
Locked, so your margin is 10%, not 45%? OK, pretty close. It has nothing to do with believing you. I think you just don't know what you're talking about. 2nd: I pay my BOA $18.50, not $9.00. But since I have no idea where Locked works, I didn't want to assume when I was doing that little analysis. 3rd: Cheese, the big difference between Location margin and the old "profit" formula, is that you no longer get a corporate overhead allocation on your P&L. So the expenses on your P&L are strictly office expenses. That's why the first bracket you have to hit $23K for the trimester to get a bonus. I assume this sort of represents the corporate overhead amount that has to be overcome to actually have some profit contribution to the firm. And incidentally, it was an accounting requirement that forced them to take the corporate allocation off the P&L and call it "Location margin".[quote=B24]Mo, I am just saying that I know many people that have no idea what the transition would be like. All they hear is how high the ticket charges are, how none of your clients come with you, and how expensive it is to pay for employer FICA (yes, much of this is spewed by Jones). So most of them don’t bother looking any further, as they KNOW what they make NOW, and they are comfortable not changing. Not that it’s RIGHT, it’s just how it is.
And as you might have gathered, I am speaking for others on this...[/quote]Maybe they actually enjoy being at Jones. Just a thought. Seems simple enough. Not everyone strives to be independent.
[quote=grimlog]
[quote=B24]Mo, I am just saying that I know many people that have no idea what the transition would be like. All they hear is how high the ticket charges are, how none of your clients come with you, and how expensive it is to pay for employer FICA (yes, much of this is spewed by Jones). So most of them don’t bother looking any further, as they KNOW what they make NOW, and they are comfortable not changing. Not that it’s RIGHT, it’s just how it is.
And as you might have gathered, I am speaking for others on this...[/quote]Maybe they actually enjoy being at Jones. Just a thought. Seems simple enough. Not everyone strives to be independent.
[/quote]
I agree completely. And "better" is subjective. But only if you know what the options are.
I am a complete greenhorn, interviewing with Jones currently. What would you be paid if you were to bring in 1 mill/year in gross, all accounts you set up? Would that be good? Mind you I am an architect making this transition, and I have no financial experience whatsoever.
[quote=grimlog]I am a complete greenhorn, interviewing with Jones currently. What would you be paid if you were to bring in 1 mill/year in gross, all accounts you set up? Would that be good? Mind you I am an architect making this transition, and I have no financial experience whatsoever.
[/quote]
Do you mean, $1million in production (what clients pay in commission or fees) or $1 million in assets?
You will starve if you only bring in $1 million in assets.
$1 million in production - it will vary. Spiff, B24 or rankstocks can tell you better what a $1 million producer will make (all things combined).
Keep in mind that it is extremely unlikely that you will make this much early in your career.
Personally, I would have stayed an architect.
[quote=B24]Few things:
Locked, so your margin is 10%, not 45%? OK, pretty close. It has nothing to do with believing you. I think you just don't know what you're talking about....[/quote] Is there some confusion regarding YTD and monthly numbers? I thought that was pretty clear for those that actually read what I wrote. But hey, whatever. It only shows that the person that didn't know what they were talking about in this situation was you.There is no business for architecture. No one is building. Going from 3-4 plans a month to zero in no time during the collapse. Unless I want to work 18 hours a day like I did for only $.50/sqft down from $2.50-$5.00/sqft
So, to make about 100k or so a year what do you have to do in AUM, means assets under management, yes?
Thanks ice, makes sense. I had no idea. Thank you for your time.
About $40,000,000 in AUM…at Jones. There are things about EJ you don’t need to know right now so I’d stay off here if I was you. EJ is a great place to start so just do what they tell you and follow the formula. When you’ve been there 3yrs…come back and we’ll tell you all you need to know. I’m not kidding!
I am not even hired yet. I have researched the position quite well and
it seems everyone wants to reinvent the wheel. I don’t know nuthin, so
I will drink the proverbial koolaid and work the wheel already there.
Thank you for your input, but I will mirror what Ice said. There is a good deal of info here. I think I can handle it, boss.
I’m just suggesting that he doesn’t need to fill his head with EJ negativity but needs to follow the formula…then we can open his eyes later.
Spiff–
If and when you get your junk bond--I mean LP. You won't be able to keep it when you retire. It's taxable federal and state as ordinary income each year. So, when the tax laws change here in a bit--close to half of what you earn on the LP will go back in taxes. Great deal? no.... but it's dangled like a carrot in front of you your whole career there. The GP's can defer part of their return and the GP returns are far greater. The amount that goes into profit sharing is pretty weak also. Other non-indy firms have much better benefits than Jones from what I have seen. Don't let them tell you what wonderful benefits you have--because you don't. My indy benefits ended up competing fairly well against my Jones benefits, which actually surprised me. I think if you compare with an "open mind", you will find that it will be difficult to stomach a long term career at Jones. You actually work like an independent, but aren't getting paid like one.@Uwec:
Wow, are you that arrogant that you make statements as if I am a fool of some kind that cannot think for himself? Were you a politician before you were a financial genius? Are you a Marxist or something? I brush of negativity, things are what you make them. You assume to many things to be good at sales. You probably talk yourself out of 80% of your potential.
I know what you meant, uwec. My point is that if you don't make it to 5 years in the first place, opening your eyes to other channels is irrelevent. And I truly believe this forum exponentially increased my early success in this business. Grim - slow down there bud. After you read a few dozen threads on this board, you'll understand what he was getting at in regards to Jones. He was just trying to be helpful, no malice intended. I just happened to disagree with his original advice.[/quote][quote=uwec1986]I’m just suggesting that he doesn’t need to fill his head with EJ negativity but needs to follow the formula…then we can open his eyes later.
I understand, but this is text, hard to discern intent. Seems "as if" if you know what I mean.
Ya’ll have a great day and I wish your coffers full o’ money. Sorry Uwec, took you out of context, my bad. []) Cheers, mate! I have to drive my kid to school. Cya, thanks for the advice.
[quote=LockEDJ][quote=B24]Few things:
Locked, so your margin is 10%, not 45%? OK, pretty close. It has nothing to do with believing you. I think you just don't know what you're talking about....[/quote] Is there some confusion regarding YTD and monthly numbers? I thought that was pretty clear for those that actually read what I wrote. But hey, whatever. It only shows that the person that didn't know what they were talking about in this situation was you.[/quote] OK, so you had one $20K month, and didn't have a BOA to pay yet. I can see how you get to 45%. Nobody can do 45% margins on 20K per month for a year at Jones. That would mean ALL of your expenses other than your commissions would have to be $40K or less for the year. Almost mathematically impossible unless you are hosting a Goodknight and they are taking the office overhead on their P&L. Or you don't have a BOA. Or you don't pay rent. Oh, and the tech fee of $15K backs your expenses down to $25K for the year. Back out the mandatory benefits (ER FICA and profit sharing), and you are down to $16K....to pay for rent and a BOA (and all the misc. expenses). The math starts to get a little fuzzy now, huh?....... You're barking up the wrong tree....Ty…Grim…that was the point I was trying to make.
Grim...Nobody has bashed EJ more than me, I would just hate to see someone allow themselves to get caught up in defending EJ at the start of their career. A new guy needs to believe that EJ is the best thing since sliced bread the first 3 years out. If he focuses on how the company might be screwing him, it will hurt his work. I know, Grim, you're an adult but the negativity about EJ will hurt you at this stage. I was not being arrogant at all, just trying to help. It's a great business but very very tough to survive the first two years. With the market down, it's a awesome time to start...you'll look like a hero no matter what equities you put your clients in. Make sure you don't confuse brains with a bull market. Good luckOops…I meant to start with “Ty…Ice”
It’s my job to be arrogant…not yours UWEC!
My bad!
Thanks guys for the insights. I understand there may be negative aspects to EJ, and how can I defend what I don’t understand yet or have even experienced? I can’t and wouldn’t even attempt to. For one thing I am certain, there are more negative disgruntled post from those who could not succeed, and probably because the lack of skill and mental fortitude. I may end as one of them and I may not. All I can control is me. I will do my best to achieve my goals and I am sure there will be barriers, but not giving up and following through to the light at the end of the tunnel is how success is made. I have done before, I can do it again. Not trying to be victorious is worse than trying your best and best and failing. You can’t win if you don’t play. The great philosopher Bosho once said, “A flute with no holes isn’t a flute, a doughnut with no hole is a Danish.”
grim - not to be a d!ck, but i have to disagree with uwec a little. make sure you keep your eyes open.
Jones is a great place to start, but it is easy to drink a little kool-aid. there are some people that are very successful that left Jones and are disgruntled.
There are some very unsavory aspects in CERTAIN AREAS of Jones. You may have a great region. But some didn’t.
[quote=Moraen]grim - not to be a d!ck, but i have to disagree with uwec a little. make sure you keep your eyes open.
Jones is a great place to start, but it is easy to drink a little kool-aid. there are some people that are very successful that left Jones and are disgruntled.
There are some very unsavory aspects in CERTAIN AREAS of Jones. You may have a great region. But some didn’t.
[/quote]
Tell me where the Utopia of firms is and we can all work there! Nothing is without its spot of bother.
I’m in PHX.
[quote=grimlog]
[quote=Moraen]grim - not to be a d!ck, but i have to disagree with uwec a little. make sure you keep your eyes open.
Jones is a great place to start, but it is easy to drink a little kool-aid. there are some people that are very successful that left Jones and are disgruntled.
There are some very unsavory aspects in CERTAIN AREAS of Jones. You may have a great region. But some didn’t.
[/quote]
Tell me where the Utopia of firms is and we can all work there! Nothing is without its spot of bother.
[/quote]
PM me. You can come work for me at my utopia of firms.
Grimlog- Your experience at Jones can vary widely according to your region. Some regions are very good some are not. Some RL’s are good ones and others not at all. FYI, in my old region, my RL defrauded numerous investors, therefore my experience was not that great.
That experience does not mean that every region is that way, just be careful who you listen to in your region. Try to educate yourself outside of the parameters of EJ, there are numerous ways to do this. Become an educated financial advisor, educating yourself is more than going to lunch with the American Funds wholesaler........Thanks. I may take you up on it when my eyes are opened!
But for now, I will take my lumps and grind through the rights of passage.
At least you have the right attitude. It is good to be king of your own firm, trust me I did it for 9 years.
Anyone know if Phoenix Edward Jones is a good area, lots of retirees and lotsa money here in the valley.
grim,
I like your attitude. If you practice what you preach--you will be successful. ZACKORegarding the P&L, Jones did the right thing on their change. It eliminated the disadvantage that high expense locations had in the past. Back then if you had to do 18k just to cover local expenses (high rent, high staff pay), you were paying a larger amount to the mythical “home office” charge. The branch that covered expenses was paying less in “HO” overhead charge. Therefore to get to dollar 1 of profit, the high expense guy had to get to well over 18k, as opposed to say 10k. The high expense branch had paid WAY more into the coffers by dollar 1 of bonus compared to the low expense branch.
I believe this new system has rectified this.
[quote=zacko]Spiff–
If and when you get your junk bond--I mean LP. You won't be able to keep it when you retire. It's taxable federal and state as ordinary income each year. So, when the tax laws change here in a bit--close to half of what you earn on the LP will go back in taxes. Great deal? no.... but it's dangled like a carrot in front of you your whole career there. The GP's can defer part of their return and the GP returns are far greater. The amount that goes into profit sharing is pretty weak also. Other non-indy firms have much better benefits than Jones from what I have seen. Don't let them tell you what wonderful benefits you have--because you don't. My indy benefits ended up competing fairly well against my Jones benefits, which actually surprised me. I think if you compare with an "open mind", you will find that it will be difficult to stomach a long term career at Jones. You actually work like an independent, but aren't getting paid like one.[/quote] This may be the most blatently untrue thing you've ever said on these boards. You keep LP until you die or sell it. It doesn't suprise me that other firms have great benefits. I don't remember ever bragging about EDJ's benefits. I actually think that a lot of top firms have better benefits than we do. I have a buddy who works for UPS - pension, 401k matching, paid medical benefits. I think his benefits are better than mine. You're barking up the wrong tree with that comment. Nice try though. As to being able to stomach a career at EDJ? As far as I'm concerned right now, not a problem. But would you expect anything different from me?You know, the more I am removed from Jones and the toxic waste dump that was my region, the less bad things I have to say about them.
Spiff - I say keep on keepin’ on! If it floats your boat, go for it.
As for any newbies starting, great place to work. I’ll only tell you what my grandfather told me: when you philosophy and the company’s philosophy are no longer in sync, leave.
To keep the LP you have to meet Jones definition of retirement. It takes into consideration your tenure and age. If you don’t meet their definition then you’ll have to sell it back.
So spiff can you enlighten us please…
If the bonus bracket is 25% (currently what is it?)and you have 10 grids starting with profit computed today differently (you say more fairly) are the grids till at 6500 of profit? Could you illustrate what the grids look like today at the current bonus percentage. I being the skeptic think they might be taking advantage of the FA for their benefit. Prove me wrong!As a W-2 employee--with a 38% average net payout, you would expect benefits competitive with other firms who have similar compensation platforms. I'm glad you agree on the inferiority of EDJ's benefits. I always thought that during my time there. Not a reason to leave, but collectively adds fuel to the fire which will burn you in the end spiffy. I was always told(while I was at Jones)--if you are making a good living, you can afford most of your own benefits..... but then again, I have come to expect nothing less from Jones.
Are you sure you aren’t talking about GP? You can’t keep your GP when you retire or past age 60 or 65 I believe, but you still become an SLP.
There's a big long letter on Joogle that basically says that you are generally allowed to take your LP with you when you leave Jones as long as you don't retire and go to work at another firm or in another capacity that Jones would construe as competition. Also, if you reach the vesting schedule which is 45 years old with your age and years of service totaling 65 years, you can keep it too as long as your not going to work for the competition. So, for me, at 45 if I stay at Jones for the rest of my career, I'll retire with my LP. As far as I know, they've always let retiring LPs hold onto what they've got. That's one of the reasons they get a pass from most Jones employees on not matching more in the 401K.[quote=BigCheese]So spiff can you enlighten us please…
If the bonus bracket is 25% (currently what is it?)and you have 10 grids starting with profit computed today differently (you say more fairly) are the grids till at 6500 of profit? Could you illustrate what the grids look like today at the current bonus percentage. I being the skeptic think they might be taking advantage of the FA for their benefit. Prove me wrong![/quote] It has nothing to do with you being a skeptic and more to do with you outright hating everything associated with EDJ.It has nothing to do with you being a skeptic and more to do with you outright hating everything associated with EDJ
Anyone at Jones care to tell the rest of us (objectively) about the bonus plan... 1- What is the firm bonus percentage currently? 2- What is the initial bonusable revenue necessary to hit the first grid? 3- What are the increments for each grid (there used to be 5 grids now there are 10)? I would prefer anyone other than Spiff respond. It appears he is reading way too much into my question. For the record... I don't hate EDJ. I am skeptical about any plan being in the FA's best interest. I just have a feeling that this new plan favors the owners.Spiff: Those are the restrictions I mentioned. Not that big of a deal, but I started at EDJ when I was 22. I left at 33 with $40k in partnership. I was still a long way off from being able to qualify to keep it.
So I sold back my $40k, went to LPL and 14 months later I have a business that can be sold for greater than $500k.Just a couple of points:
Most of the vets I know that are bonused said the grid pretty much works out the same way now as it did before. The calc is different, but it ends up about the same. Trust me, they all scrambled to compare pre-change bonus to post-change bonus, and they were all fine with it. I think the only people that would see a significant change (more than 5% up or down, and that's 5% of their previous bonus, not 5 bonus percentage points) were the people that had really high branch costs (they would make out better), and people that had really low branch costs (they would make out worse) compared to the average at the firm. But most people were going to be within a few hundred dollars up or down, depending on whether you fell above or below the average cost line. Bascially what they did was eliminate the Home Office allocation based on office size, and just require a straight $23K in positive "Location Gain" each trimester (so 8K per month) before your bonus kicks in for all branches. I have no idea what their true intentions were, but as I said, I have not heard a single complaint about the new bonus structure from anyone. Of course, I live in a high-cost area, so it's possbile that most of them ended up the same or better. Firm Profit Margin Firm Bonus Level Location Margin $0-$23,000 $23,001-$33,000 $33,001-$43,000 $43,001-$53,000 $53,001-$63,000 $63,001+ 5.00% 1 0% .5% 1.0% 2.0% 3.0% 4.5% 5.75% 2 0% 1.0% 2.0% 4.0% 6.0% 9.0% 6.50% 3 0% 1.5% 3.0% 6.0% 9.0% 13.5% 7.25% 4 0% 2.0% 4.0% 8.0% 12.0% 18.0% 8.00% 5 0% 2.5% 5.0% 10.0% 15.0% 22.5% 8.75% 6 0% 3.0% 6.0% 12.0% 18.0% 27.0% 9.50% 7 0% 3.5% 7.0% 14.0% 21.0% 31.5% 10.25% 8 0% 4.0% 8.0% 16.0% 24.0% 36.0% 11.00% 9 0% 4.5% 9.0% 18.0% 27.0% 40.5% 11.75% 10 0% 5.0% 10.0% 20.% 30.0% 45.0% This chart is per tri-mester (4 months), not per month. So just roughing it out, a $1mm producer would see a bonus of about $85,000 per year in the 6th bonus bracket (we have averaged about the 6th bonus bracket for the last 18 years, with some wide swings).Ice-
You right on the money. LPL is no better. B- It seems like the bonus has been reduced. I remember when bonus represented 25% of pay. In your scenario 85K bonus and 380K its a little over 22%. Before I hear from you know who...its not down that much!!! What about the 500K producer, do they feel the same? I try so hard to be balanced. Really I do.[quote=zacko]
grim,
I like your attitude. If you practice what you preach--you will be successful. ZACKO[/quote]By definition, every word that comes out of my mouth is a promise, - Brando, the Freshman.
Thanks Zacko. You are right, our actions define who we are. One may talk a good game, but do they play it the same?
[quote=BigCheese]Ice-
You right on the money. LPL is no better. B- It seems like the bonus has been reduced. I remember when bonus represented 25% of pay. In your scenario 85K bonus and 380K its a little over 22%. Before I hear from you know who...its not down that much!!! What about the 500K producer, do they feel the same? I try so hard to be balanced. Really I do.[/quote] I honestly don't know either way. But I am telling you the honest truth when I say I have not heard anyone complain. I was simply picking a bonus bracket out of the air. If you were in the 8-10 brackets, it would clearly be much higher. And who knows, profit on a $1mm office might be much higher. I was doing some REAL rough estimates (based on wages and rents in my area, which are in the highest bracket in the country). And the producers I am referring to, most are under 650K. But who knows, some of them seem too dumb to bother comparing, so maybe you're right. But if it's down, it's VERY slightly. Even when the change first came out, I did the math on various production numbers, and it was almost identical. Trust me, if I felt it was a real downward adjsutment, I'd have no problem calling them out on it.You know who is going to keep quiet on this one and hope that rank or ytrewq or hulk shows up to shut him up one way or the other.
In regards to the Jones bonus system: In 2002 I had a great year at Jones. I did close to 900k that year because of a few large accounts that came in. I worked very hard that year because of the market conditions. It was a rough bear market–so there was no bonus–that’s right ZERO. My branch had approx 300k profit. I was stuck with a 38% payout. Doug Hill made slightly more money in 2002 than he did in 2001. Some of the vets will remember this… It was then when I decided enough was enough. There were articles written about “Mass Exodus” at Jones.
They also postponed the LP because of the legal troubles and the bear market. So after ten years at Jones and grossing over 500k for my last 5 years, I had 30k in LP. I probably mentored half a dozen or more FA's, interviewed a couple, and was a mentor trainer for the region as well. I participated in conference calls to help the region, called individual reps who were struggling. Basically, I let myself get taken advantage of and do hours of work for Jones for free. So, excuse me if I speak out a bit.... And, I will tell my tale of woe and despair wherever I go.The whole point of the story is that you can’t depend on bonus payouts to be part of your income on a regular basis. If they are available good for you… My net since moving from Jones to LPL is now 72% after I pay my costs. That is on every dollar of production. That is always going to be better for me and my family than the 38.5% that I was getting at Jones before I started calculating the other costs that I had at Jones.
Yeah your right, 2002 was a "great year" with a low net payout for anyone who had a "great year" And, a great year for the top GP's at Jones.... with Doug Hill getting a pay raise. 1300 IR/FA's left Jones the next year in 2003. Over 12% of the greatest salesforce and number one company to work for? I guess they don't include such articles in their reprints?
2 straight trimesters was 8 months...so it's close to a year and it included my best trimester ever at Jones with no bonus. The other two were low bonus brackets. The fact remains, even IF Jones were in the top 50% bonus bracket, I would have still fared better as an indy, although the numbers would have been closer. Trust me Space, I do remember both the good and the bad from Jones. However, the more I am reminded of the past -- The more I become thankful for the present. It's not even close. ZACKOExactly. The clones remain clueless defenders of what they are told to be true rather than what is actual fact.
Spiffy,
Are you Rick S. in FL?I have to side with Zacko on this one. One of the hardest parts about Jones’ compensation system is not really being in control of your bonus. Yes, you control your production, but that’s where it ends. My mentor is having a breakout year, and he will have next to no bonus this year. He is obviously not happy.
I guess my biggest concern is, as I continue to grow my fee business, I don't want to get in the situation where I have, I don't know, say $450K in recurring revenue, and one year I make $240K, and the next year make $180K because of the market or Jones' financial results or whatever. I can accept lower pay due to market changes in my AUM. But I can't accept lower bonuses due to Jones hiring 1500 newbies and having to train them and pay them. Not when the base pay starts at 40%. If it were like 50% and then bonus above that, well then I would look at it as more of a firm profit sharing contribution. But 40% is too low if you can completely wipe out the bonus of a million-dollar producer. In some ways, I think there should be some additional payout grids for higher producers, at the expense of bonuses to lower producers. Even though I am not close to that level yet, I just think it's wrong for $500K+ producers to have the same payout as a $100K producer in a bad year when there are no bonuses (or even low bonus brackets).Correct B24. That's what irritated me.... I was receiving the same payout as a second year broker although I was grossing over 70k on average per month. Now, I am getting my own "bonus" with every ticket I place. Same payout on A, B, or C shares also---it's a leap ahead in every way. That's the entire point of starting this thread--and that's why "I am still thankful after six years away from Jones"
Yes, we are quirky migone.[quote=zacko]
Yeah your right, 2002 was a "great year" with a low net payout for anyone who had a "great year" And, a great year for the top GP's at Jones.... with Doug Hill getting a pay raise. 1300 IR/FA's left Jones the next year in 2003. Over 12% of the greatest salesforce and number one company to work for? I guess they don't include such articles in their reprints?
2 straight trimesters was 8 months...so it's close to a year and it included my best trimester ever at Jones with no bonus. The other two were low bonus brackets. The fact remains, even IF Jones were in the top 50% bonus bracket, I would have still fared better as an indy, although the numbers would have been closer. Trust me Space, I do remember both the good and the bad from Jones. However, the more I am reminded of the past -- The more I become thankful for the present. It's not even close. ZACKO[/quote] Yep, Doug Hill did get a raise in 2002. The first one in a couple of years. His salary went up from $175K to $181K. Barely a cost of living raise. His GP payout went up by about $100K, which was a 3.5% increase from 2001, but a 43% drop from 2000. Not that I feel terribly sorry for anyone making $3 mil a year, but just to give the folks some persepective, I thought I might share that piece of info. I'd bet that if Doug knew it upset you so much, he would have skipped over that .02% bump in his compensation for the year. I'm not going to take the time to double check your facts on the attrition that year. I'll take your word for it. The question is, how many of those folks were New FAs who just simply didn't surivive the bear market? You make it sound like all of those folks left the company to find greener pastures at places like LPL and RJ or other brokerage firms. I don't think that was the case. I'd bet a lot of those folks left the business altogether. I'll say it again, like I did in maybe my second post in this thread - congrats. I'm happy that you're happy at RJ.Glad you have finally recognized that RJ and LPL are greener pastures.... and to think it took 32 pages!
I think about 1/3 left for other firms--and the other 2/3 were noobs. I didn't like the fact that Doug Hill got a pay raise at all during a year where no bonus was paid to the hardworking IR--who are the sole source of revenue for the firm. Firm revenue was down 20% if not more and he gets an increase in his personal pay? His income did of course double in 2004 to over 7 million which was the year he was forced to step down by regulators. After multiple trips to the home office, the only GP that I ever really respected was Tom Bartow. He might have been a liitle off center--ok--more than a little..... but he actually cared more than most. And--although I didn't know it at the time, I learned alot from him.[quote=zacko]
Glad you have finally recognized that RJ and LPL are greener pastures.... and to think it took 32 pages!
I think about 1/3 left for other firms--and the other 2/3 were noobs. I didn't like the fact that Doug Hill got a pay raise at all during a year where no bonus was paid to the hardworking IR--who are the sole source of revenue for the firm. Firm revenue was down 20% if not more and he gets an increase in his personal pay? His income did of course double in 2004 to over 7 million which was the year he was forced to step down by regulators. After multiple trips to the home office, the only GP that I ever really respected was Tom Bartow. He might have been a liitle off center--ok--more than a little..... but he actually cared more than most. And--although I didn't know it at the time, I learned alot from him.[/quote] You obviously have a reading comprension problem...Spiff said...and I quote " left the company to find greener pastures at places like LPL and RJ or other brokerage firms"...that doesn't mean that they actually found greener pastures there...just that that was what they were looking for! For a million dollar producer like yourself, you sure must have a bug up your ass to come on here and bash like you do. My question for you is...did you start your career at EDJ? I agree with you about Bartow...he is a lunatic, but has lots to teach![quote=zacko]
Glad you have finally recognized that RJ and LPL are greener pastures.... and to think it took 32 pages!
I think about 1/3 left for other firms--and the other 2/3 were noobs. I didn't like the fact that Doug Hill got a pay raise at all during a year where no bonus was paid to the hardworking IR--who are the sole source of revenue for the firm. Firm revenue was down 20% if not more and he gets an increase in his personal pay? His income did of course double in 2004 to over 7 million which was the year he was forced to step down by regulators. After multiple trips to the home office, the only GP that I ever really respected was Tom Bartow. He might have been a liitle off center--ok--more than a little..... but he actually cared more than most. And--although I didn't know it at the time, I learned alot from him.[/quote] It must have killed you that a guy like me got a pay raise in 2002 then too. Mine would have been a higer percentage than Doug's, though. Maybe about 4.5-5%. But that's because I got a cost of living and a merit increase. I was such a good little home office employee. Are you reading the 10-K? Are you missing the part about Doug taking a $2 MILLION cut in his partnership earnings between 2000 and 2002? And you're going to complain about him getting a 3% raise ($6000 and some change) on his personal salary? It wasn't until 2005 that his total compensation his $7 mil. In fact, in 2004, when you said his income double, according to the 10-k, his total icome dropped down to $1.8MM. I believe that was the year that he took $3MM out of his own pocket and kicked it into the uwec whistle blower fund. I'm not a big Doug Hill fan. I liked Bachmann, love Weddle, but was indifferent to Hill. I think he's much more effective now that he's not the MP than he was. If you want to use his salary as one of the reasons you left EDJ, great, more power to you. I don't see it as the evil GPs trying to screw the FAs. Evidently you do. We'll have to agree to disagree. foot - no, I'm not in FL.Where's my piece of the Whistle Blower Fund?
Salvador Dali has this great painting called The Persistence of Memory. It’s the one with the clocks that look like they’re melting over the cliff. I love that painting. Mostly because it reminds me that we don’t always remember things as they really were, but more in the way that we want them to be.
Spiff- It was your friend the revenue sharing whistle blower who asked you if you were located in Florida. I remember distinctly you are one of the chosen on a street corner in or around SL. I just wanted to comment that everyday you impress me with your vast knowledge. Now we are reminded of your love of art...and Jim Weddle. And then you end with the most intelligent statement in the history of mankind which is highlighted above. Cuts both ways.[quote=BigCheese]Salvador Dali has this great painting called The Persistence of Memory. It’s the one with the clocks that look like they’re melting over the cliff. I love that painting. Mostly because it reminds me that we don’t always remember things as they really were, but more in the way that we want them to be.
Spiff- It was your friend the revenue sharing whistle blower who asked you if you were located in Florida. I remember distinctly you are one of the chosen on a street corner in or around SL. I just wanted to comment that everyday you impress me with your vast knowledge. Now we are reminded of your love of art...and Jim Weddle. And then you end with the most intelligent statement in the history of mankind which is highlighted above. Cuts both ways. [/quote] ....BC....you crack me up!I was just wondering, O gods O FA Forum, are you ever proactive about this stuff, meaning to say forget the past and look forward to the future? You know, maybe be positive, and support each other in your efforts? Just a thought.
Go ahead and laugh away…
I have my behavioral call on Tuesday. What should I expect to be asked? We’re not talking nudity and bowls of jello, farm animals, and such are we? What kind of behavioral ?'s
lets stop with the ej threads. they’re so boring, as is the firm itself and their simple minded reps.
Hey, there is a fantastic persuasive argument to desist. Insult some people and then request that it ends. Generalize a group of people and ask that no one offers a volley? Yeah, let’s see how that goes. Sorry, but you are so exciting and intricate in your thinking. Tell, us, oh complex minded easy$$, uhmm prostitute, what do you have to say that is so exciting?
Kool Aid-
It's called sarcasm. And yes, I started my investment career at Jones durring the mid 1990's. I started my office in a town where I knew no one, and built my office to the second highest grossing office in my state over the next ten years before leaving for much greener pastures. In fact, I own the pasture now. I bash where and when it is completely deserved--but hopefully, it's taken lightly and some find benefit.Source URL:https://www.wealthmanagement.com/forums/whats-firms/jones-rjfs-thankyou