Going Indy out of the gate

or Register to post new content in the forum

39 RepliesJump to last post

 

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Dec 23, 2006 10:17 am

I could use some advise.

I am going into the FA biz and have not been in the FA biz previously and need to decide on the best course of action for the future.

My background is in extensive sales/sales mgmt with some entrepreneural efforts that have paid off well for me.  I am relatively well versed in investments as it has been a passion of mine for about 18 years.

My immediate to intermediate goals are to have my own FA office ASAP.  The one minor detail I lack is experience.

What would be the best method for me to obtain the needed education and experience?

I have considered going to work for firms like EJ, for the training.  Would it be worth it?

Another option is a casual FA friend has offered to sign me under his B/D at 70% payout, for 2 years and provide me training.  After the 2 years are up, I am on my own at 90% payout with LPL.

My concern is will his training be enough?  Is there a way to subsidize it concurrently?

So that the context of my situation is well understood, I am a 40 year old and do not need income at this time and have funds set aside for marketing to attract new clients.

Another concern is branding and credibility. Will my short tenure in the business create a problem with client acquisition?

Dec 23, 2006 10:33 am

When I began with EDJ, I went around trying to sell everybody on the great reputation of Jones; however, when I made repeat contacts with my prospects, I realized that noone remembered the firm I was with.


To answer your question, I now realize that "branding" is very unimportant in this business.


People will do business with a financial advisor they like and can trust. Period.


Dec 23, 2006 10:46 am

Macdaddy,



Consider working under an independent, I know of several who offer you free office/ secretary / phone etc and pay 65% payout

Dec 23, 2006 11:09 am
Borker Boy:

When I began with EDJ, I went around trying to sell everybody on the great reputation of Jones; however, when I made repeat contacts with my prospects, I realized that noone remembered the firm I was with.


To answer your question, I now realize that "branding" is very unimportant in this business.


People will do business with a financial advisor they like and can trust. Period.




Well that is a relief!  I was hoping this biz was more about relationships and trust vs branding and a big name.

Dec 23, 2006 11:12 am
bankrep1:

Macdaddy,



Consider working under an independent, I know of several who offer you free office/ secretary / phone etc and pay 65% payout



I am assuming you are speaking specifically of independents in your area?  The current deal in question with the guy I know does not include the office/secretary/phone, etc.

Can I find these guys in my area?  What is the best way to approach them? 

Dec 23, 2006 3:15 pm
MacDaddy:
bankrep1:

Macdaddy,



Consider working under an independent, I know of several who offer you

free office/ secretary / phone etc and pay 65% payout

I am

assuming you are speaking specifically of independents in your area? The

current deal in question with the guy I know does not include the office/

secretary/phone, etc.Can I find these guys in my area? What is the best way

to approach them?





Pick up the phone and ask.

Dec 23, 2006 5:07 pm
Starka:




Pick up the phone and ask.





Which is good practice anyways.



: Bonus points if you can sell them a muni bond or CD


Dec 23, 2006 5:09 pm

...ask and ye shall receive...


That's a tough call from my perspective.  Almost without fail, I recommend against attempting going independent right out of the gate, although you present a less common startup opportunity that may just work pretty well if you paddle hard from the outset.


Although I question their methodology at times, I think you would get pretty good training at the outset from Edward Jones.  The question in my mind is if it's worth going from 70% to 40% for.  I could be completely wrong about it, and the independent you are talking to could be a wonderful mentor, but I doubt he/she has a formal training program for new representatives.  If he/she is like me, you'd be fine...I very much enjoy educating/mentoring (thus all my posts to these forums) and I've had pretty good success mentoring new reps in my previous non-indy life.  Unfortunately, I suspect that I am in a minority and that most indy reps like running their own business without a newbie bothering them with a lot of questions.  On the other hand, if you are a good self-starter, you would probably be well ahead on your goals by working with an independent.


As far as supplemental training, I would search this forum for "books" as there are several good ones recommended from time to time.  I think Jeff Cadeiux even has several listed on his website.  Two of my favorites are Ron Carson's "Tested in the Trenches" and Bob Fragasso's "Starting Your Own Practice".  Not entirely coincidentally, these guys are both independent advisors with LPL.


There are all sorts of free trade magazines (including Registered Rep) that you can devour.  If you're real ambitious, you could contact the College of Financial Planning and enroll in their CFP program, with the goal of obtaining your CFP once you pass the test and possess the necessary experience.  I don't know how hard you want to work, but if you did a lot of education and worked your business hard, you could work/study 80 hours a week easily.


Wherever you end up, promote yourself...not the company.  The company is just there to provide back office support.  That way, if you make a change later, it's not so traumatic for you and your clients.


It's not really an answer, but given your eventual goals and entrepreneurial past, and my personal distaste with changing firms, I would probably lean more toward affiliating with an independent, particularly if he/she enjoys, and is good at, mentoring.

Dec 23, 2006 5:13 pm

...and if you want to find local LPL reps, go to the LPL website and look for reps by zip code.

Dec 23, 2006 7:35 pm

he is a LPL rep, I would call main office of LPL they know who these guys are because he acts as the OSJ for all the reps in his office what state are you in?

Dec 23, 2006 9:02 pm

Like Indyone, my concern for you would be getting out of the gate. Jones

woulod give you a good education, teach you how to get a client base

quickly, but that's about it. If you are really a self-starter, can learn and

adapt quickly, and will take advice well, then going with Jones may just

complicate your ultimate desire to be Indy. Since you said funds are not

an issue, you may be able to build your book correctly right from the

beginning (most of us have had to take pretty much anything we can in

the beginning so we can eat). Build a nice combo of commission and fee

biz, with quality clients. If you can learn how to do that on your own,

then I would say go for it!

Dec 24, 2006 8:18 am
Indyone:

...ask and ye shall receive...


That's a tough call from my perspective.  Almost without fail, I recommend against attempting going independent right out of the gate, although you present a less common startup opportunity that may just work pretty well if you paddle hard from the outset.


Although I question their methodology at times, I think you would get pretty good training at the outset from Edward Jones.  The question in my mind is if it's worth going from 70% to 40% for.  I could be completely wrong about it, and the independent you are talking to could be a wonderful mentor, but I doubt he/she has a formal training program for new representatives.  If he/she is like me, you'd be fine...I very much enjoy educating/mentoring (thus all my posts to these forums) and I've had pretty good success mentoring new reps in my previous non-indy life.  Unfortunately, I suspect that I am in a minority and that most indy reps like running their own business without a newbie bothering them with a lot of questions.  On the other hand, if you are a good self-starter, you would probably be well ahead on your goals by working with an independent.


As far as supplemental training, I would search this forum for "books" as there are several good ones recommended from time to time.  I think Jeff Cadeiux even has several listed on his website.  Two of my favorites are Ron Carson's "Tested in the Trenches" and Bob Fragasso's "Starting Your Own Practice".  Not entirely coincidentally, these guys are both independent advisors with LPL.


There are all sorts of free trade magazines (including Registered Rep) that you can devour.  If you're real ambitious, you could contact the College of Financial Planning and enroll in their CFP program, with the goal of obtaining your CFP once you pass the test and possess the necessary experience.  I don't know how hard you want to work, but if you did a lot of education and worked your business hard, you could work/study 80 hours a week easily.


Wherever you end up, promote yourself...not the company.  The company is just there to provide back office support.  That way, if you make a change later, it's not so traumatic for you and your clients.


It's not really an answer, but given your eventual goals and entrepreneurial past, and my personal distaste with changing firms, I would probably lean more toward affiliating with an independent, particularly if he/she enjoys, and is good at, mentoring.



...knock and the door shall be opened...

Thanks for the sound advise, Indy.  I will spend some more time with this gentleman to see if he has the makings of being a good mentor.  Also I will check out some other firms that might offer a me a similar mentoring relationship with an option to fully solo in 2 or 3 years.

I have checked out the books you have mentioned, and will be purchasing them.

With regards to becoming a CFP.  Is this a difficult test to take?  It appears that thru the College of Financial Planning homestudy course that it takes a minimum of 3 months of study, per thier schedule to test.

Is this a program that actually provides education that is applicable? (if you know what I mean).  In other words, would I walk away from this program empowered with the knowledge, or will I more or less just become more credible to my clients because my business card says "CFP"?

The FP that I have referred to does not have his CFP and says that he has yet to have a client ask him if he did.  However I will say that his bread and butter clients are the typical mom and pop retirees.


Dec 24, 2006 8:27 am
Broker24:

Like Indyone, my concern for you would be getting out of the gate. Jones

woulod give you a good education, teach you how to get a client base

quickly, but that's about it. If you are really a self-starter, can learn and

adapt quickly, and will take advice well, then going with Jones may just

complicate your ultimate desire to be Indy. Since you said funds are not

an issue, you may be able to build your book correctly right from the

beginning (most of us have had to take pretty much anything we can in

the beginning so we can eat). Build a nice combo of commission and fee

biz, with quality clients. If you can learn how to do that on your own,

then I would say go for it!



I am looking at this business like an investment.  If I put money into proper marketing, after I become competent in FP, then the rewards should yield a lifetime residuals that, in theory, should only grow from the outset.  With that in mind, I am not opposed to spending $50-100K during the first two years in targeted marketing to build the business.

Dec 24, 2006 3:20 pm
MacDaddy:
Broker24:

Like Indyone, my concern for you would be getting out of the gate. Jones

woulod give you a good education, teach you how to get a client base

quickly, but that's about it. If you are really a self-starter, can learn and

adapt quickly, and will take advice well, then going with Jones may just

complicate your ultimate desire to be Indy. Since you said funds are not

an issue, you may be able to build your book correctly right from the

beginning (most of us have had to take pretty much anything we can in

the beginning so we can eat). Build a nice combo of commission and fee

biz, with quality clients. If you can learn how to do that on your own,

then I would say go for it!



I am looking at this
business like an investment.  If I put money into proper
marketing, after I become competent in FP, then the rewards should
yield a lifetime residuals that, in theory, should only grow from the
outset.  With that in mind, I am not opposed to spending $50-100K
during the first two years in targeted marketing to build the business.





You're cute. You want this to be self-financing, given the poor
sucess-rate in this business you don't want to be in the hole from the
outset.



About the only course I would take is a Dale Carnegie course. That is really worth it.

Dec 24, 2006 5:26 pm
AllREIT:
MacDaddy:
Broker24:

Like Indyone, my concern for you would be getting out of the gate. Jones
woulod give you a good education, teach you how to get a client base
quickly, but that's about it. If you are really a self-starter, can learn and
adapt quickly, and will take advice well, then going with Jones may just
complicate your ultimate desire to be Indy. Since you said funds are not
an issue, you may be able to build your book correctly right from the
beginning (most of us have had to take pretty much anything we can in
the beginning so we can eat). Build a nice combo of commission and fee
biz, with quality clients. If you can learn how to do that on your own,
then I would say go for it!



I am looking at this business like an investment.  If I put money into proper marketing, after I become competent in FP, then the rewards should yield a lifetime residuals that, in theory, should only grow from the outset.  With that in mind, I am not opposed to spending $50-100K during the first two years in targeted marketing to build the business.



You're cute. You want this to be self-financing, given the poor sucess-rate in this business you don't want to be in the hole from the outset.

About the only course I would take is a Dale Carnegie course. That is really worth it.


Cute? 


What I am is serious.  As a seasoned and financially independent full time investor and entrepreneur, I can invest into my business with disposable income via marketing efforts for client acquisition.  What is cute regarding this business model?


Should I instead slug away with sub par and discouraging results for a number of years with no marketing, when I can afford to market and build my business at a faster rate?


Dale Carnegie is good, but more for those with no sales experience.  As I stated earlier, I was formerly very successful in sales and sales management, therefore Carnegie would be at the bottom of my list.

Dec 24, 2006 6:59 pm

"What I am is serious.  As a seasoned and financially independent
full time investor and entrepreneur, I can invest into my business with
disposable income via marketing efforts for client acquisition.  What
is cute regarding this business model?"



Because everyone in this business has the same model, and 90% of them
fail. You use alot of jargon. This business is not like working a coke
machine where you put in $0.75 and get a cold soda, every time.



"Should I instead slug away with sub par and discouraging results for
a number of years with no marketing, when I can afford to market and
build my business at a faster rate?"



You're going to find that the ROI on marketing is very low. Why do
brokers make such a fuss about cold calls, door knocking,netowkring,
direct mail etc? Because they are cheap and therefore ROI is low but
acceptable



The people you want as clients, (HNW types) are not acessable via the
normal marketing channels. At the upper levels this is a referral based
business. Untill you build up a personal network of happy clients you
have a hard row to hoe. Financial products are bought not sold.



"Dale Carnegie is good, but more for those with no sales experience.  As
I stated earlier, I was formerly very successful in sales and sales
management, therefore Carnegie would be at the bottom of my list."



You come across as arrogant, harsh and unwilling to listen. Dale Carnegie might help you. 

Dec 24, 2006 8:27 pm

Jargon, what jargon?

90% fail because they are under the financial gun to "make it or break it" and must put food on the table or they lack tenacity, ambition, and people skills.  That is not me. 

I do not find your advise valuable, so please help someone else.  I am not arrogant, I am experienced, and have stated only what is necessary to put my situation into proper context.

I am however, soliciting those whose advise is worth listening to, such as Broker24 and Indyone or anyone else willing to help.

This business is NOT just about High Net Worth Clients.  My friend grosses $400K on mom and pop retirees as the bulk of his business, with the occasional 3-5 mill client peppered in.  He is happy and content with this level of productivity and does little to expand his practice.  FYI, he did obtain a 5 mill client through advertising in "The Christian Blue Pages".  So marketing can and does work(this is one infinitesimal example), along with other obvious methods like networking.

Dec 25, 2006 12:27 am

I do not find your advise valuable, so please help someone
else.  I am not arrogant, I am experienced, and have stated only
what is necessary to put my situation into proper context.





You don't even have your series 7!



Arrogant yes, experienced no.

Dec 25, 2006 9:56 am
AllREIT:

I do not find your advise valuable, so please help someone
else.  I am not arrogant, I am experienced, and have stated only
what is necessary to put my situation into proper context.





You don't even have your series 7!



Arrogant yes, experienced no.



You are entitled to your own opinion.

Again, I will ask, please stop wasting my thread space with  pointless arguments.   I want  this thread to be of substance not slanders.

Dec 25, 2006 6:27 pm
MacDaddy:
Broker24:

Like Indyone, my concern for you would be getting out

of the gate. Jones

woulod give you a good education, teach you how to get a client base

quickly, but that's about it. If you are really a self-starter, can learn and

adapt quickly, and will take advice well, then going with Jones may just

complicate your ultimate desire to be Indy. Since you said funds are not

an issue, you may be able to build your book correctly right from the

beginning (most of us have had to take pretty much anything we can in

the beginning so we can eat). Build a nice combo of commission and fee

biz, with quality clients. If you can learn how to do that on your own,

then I would say go for it!

I am looking at this business like an

investment. If I put money into proper marketing, after I become

competent in FP, then the rewards should yield a lifetime residuals that,

in theory, should only grow from the outset. With that in mind, I am not

opposed to spending $50-100K during the first two years in targeted

marketing to build the business.





Mac, contrary to what you think, you're not the first to come up with that

particular strategy. (Although if it works for you, you'll be the first to

succeed.) You see, just about all of us at one time or another have

thrown money at marketing strategies that just didn't pan out. Unlike

many businesses, there is no direct correlation between ad dollars spent

and new money coming in. Witness the dearth of financial services

advertising by individuals as compared with other industries. The only

ads seen on TV for example are run by the big nationals, and even then

they are the "warm and fuzzies" and not the "come in today" seen in other

businesses. And trust me, no matter how much "extra cash" you have,

you won't outspend Merrill Lynch.



At the end of the day, the only advisors that are successful over time are

those who build a business over time, one client at a time.



Oh, and by the way...you do come across as arrogant whether or not that

is your intent.



Best of luck to you.