LPL Starting Costs

or Register to post new content in the forum

31 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 17, 2008 10:20 pm

I am contemplating making the move from a major b/d to LPL.  I am trying to get an estimate of the costs associated with getting my bizup and running.  Anyone done this recently and approximately how much did it cost to get up and running?

Dec 17, 2008 10:27 pm

7 dollars. Just kidding.


You really need to give some parameters to your question otherwise all you get is a WAG.

Dec 17, 2008 10:36 pm

Like Noggin is saying, you need to give parameters: Geography(rent/own), how nice you want to look, how big, how much help you need etc...

Dec 17, 2008 10:40 pm

Fair enough.  I was wondering what the fees at LPL are.  They advertise a 90% payout on annuitized products, but that's gross.  Net of costs, and what those ongoing costs are, I was wondering what the payout really is.  LPL has offerred me a few dollars to get my practice upo and running, but I have no idea how expensive it might be to do so.  I imaagine I have to buy my own computer, fax machine, pay for office space, as well as many other costs.  My question was really trying to further understand what costs (ongoing as well as up front) I should expect if I make the move.

Dec 17, 2008 10:45 pm

I am leaning toward working in an office with an existing LPL broker.  The rent is about $700 per month.  Initially we may hire an intern or part time person to open accounts and do other admin things.  Not sure about long-term.  I imagine as the biz grows, we'll have t ohire a full time Assistant.  Hope this helps.

Dec 18, 2008 12:30 am

I'm running about 86- 87% after ticket charges and SAM admin fees, and that's with getting into the 92% bonus bracket.  You can probably count on 4-5% expense for ticket and overrides.  LPL will do a sample run for you if you give them some information about the makeup of your book.

 
...and don't go cheap on your computer.  I'm on my 2nd notebook PC since I went independent and both times, I've spent some extra $$$ for a nice widescreen with a docking station and numeric keypad built in.  I carry this computer back and forth and have it linked to both the office and home networks so I can work both places.  This is particularly nice on snow days here in the midwest.
 
I also have a 2nd monitor (19-inch), so I can turn the screen around client presentations.  You might also want a color/laser fax/scanner/network printer, which can be had for less than a grand and is a very versatile machine.  What I've mentioned will run less than $5,000.  A file server is optional as far as I am concerned, but you do want a network printer as mentioned above.  Finally, I spent in excess of $10,000 for the furniture just in my office.  What else you curious about?
Dec 18, 2008 8:10 am
Indyone:

I'm running about 86- 87% after ticket charges and SAM admin fees, and that's with getting into the 92% bonus bracket.  You can probably count on 4-5% expense for ticket and overrides.  LPL will do a sample run for you if you give them some information about the makeup of your book.

 
...and don't go cheap on your computer.  I'm on my 2nd notebook PC since I went independent and both times, I've spent some extra $$$ for a nice widescreen with a docking station and numeric keypad built in.  I carry this computer back and forth and have it linked to both the office and home networks so I can work both places.  This is particularly nice on snow days here in the midwest.
 
I also have a 2nd monitor (19-inch), so I can turn the screen around client presentations.  You might also want a color/laser fax/scanner/network printer, which can be had for less than a grand and is a very versatile machine.  What I've mentioned will run less than $5,000.  A file server is optional as far as I am concerned, but you do want a network printer as mentioned above.  Finally, I spent in excess of $10,000 for the furniture just in my office.  What else you curious about?



Did you buy a Swingline stapler or some other brand?

Dec 18, 2008 9:36 am

Furniture for the office, like Indy said, will probably be the most expensive items(again depending on what you need). So figure $5K for equipment(laptop,printer,misc office supplies) and then another $3-10K on office furniture. (If you are just getting started I think you can spend a little less on the furniture and as you get more established upgrade)

Dec 18, 2008 9:38 am

If you're talking stapler's, is there really any other brand?

Dec 18, 2008 11:33 am

Having just moved to LPL, I can tell you that Indy's estimates are spot-on.  Net payouts will be in the 85% range.

 
As for start-up, we spent about $8K per advisor to get our office up and running.  There are other costs as well such as LPL's affiliation fee ($125/mo.), technology ($25-300/mo.), E&O ($512/Q), state licensing fees, an annual compliance fee (if you're OSJ), and one-time LPL registrations that cost about $1000.
 
All in all, our monthly nut is about $2500/advisor, but we have a really nice office.  For us, this business model made huge sense.  For example, if I do $10K gross in a month, I'm taking home $6K... as opposed to $3300 at my old BD.
 
 
Dec 18, 2008 2:51 pm

It probably also depends how many people are splitting the costs.  If you have 4 advisors and one assistant, it will be much more economical than if you have one advisor and 2 assistants.  This is where it pays for indy's to partner up - even if it's just an office-sharing arrangement.

Dec 18, 2008 10:06 pm

I would be renting office space in a shared office space building.  The office I owuld rent is about $600 a month, furnished.  I would have to buy equipment like fax/scan/copy maching, computer, etc.  Any ideahow much more a month I should expect in expenses from LPL?

Dec 18, 2008 11:23 pm
Hank Moody:
Indyone:

I'm running about 86- 87% after ticket charges and SAM admin fees, and that's with getting into the 92% bonus bracket.  You can probably count on 4-5% expense for ticket and overrides.  LPL will do a sample run for you if you give them some information about the makeup of your book.

 
...and don't go cheap on your computer.  I'm on my 2nd notebook PC since I went independent and both times, I've spent some extra $$$ for a nice widescreen with a docking station and numeric keypad built in.  I carry this computer back and forth and have it linked to both the office and home networks so I can work both places.  This is particularly nice on snow days here in the midwest.
 
I also have a 2nd monitor (19-inch), so I can turn the screen around client presentations.  You might also want a color/laser fax/scanner/network printer, which can be had for less than a grand and is a very versatile machine.  What I've mentioned will run less than $5,000.  A file server is optional as far as I am concerned, but you do want a network printer as mentioned above.  Finally, I spent in excess of $10,000 for the furniture just in my office.  What else you curious about?



Did you buy a Swingline stapler or some other brand?

 
Having pretty much lived Office Space at my previous employer, I bought not only a Swingline, but a RED Swingline.  No sense screwing around with a cheap, staple-jamming piece of crap.
Dec 18, 2008 11:38 pm
aande24:

I would be renting office space in a shared office space building.  The office I owuld rent is about $600 a month, furnished.  I would have to buy equipment like fax/scan/copy maching, computer, etc.  Any ideahow much more a month I should expect in expenses from LPL?

 
Not including the aforementioned ticket charges and override, $125 contract fee, $75 for Branchnet access, $10 bonding fee, $45 for S&P research, $30 for Zacks research, $35 for portfolio review tool, and $75 for portfolio management reports. E&O insurance is $512.50/quarter.  Other than the contract fee, bonding fee and the E&O, everything else is optional stuff that I've added, although I wouldn't want to run without Branchnet.
 
At year-end, you'll have to eat all your state and branch license fees (mine were $775).
Dec 19, 2008 10:03 am

What portfolio review tool are you using?

Dec 19, 2008 10:15 am
chief123:

What portfolio review tool are you using?

 
LPL has it's own PRT.
Dec 19, 2008 9:14 pm

Can any of you who have answered give any detail on the difference caused by being or not being your own OSJ on platforms that offer either option? How much does stand alone branch vs. osj matter in your situation?

Dec 19, 2008 9:22 pm

You will pay a 15% over-ride for home-office OSJ oversight.

Dec 20, 2008 11:50 am

That's if you want LPL to be your OSJ.  If you can find another LPL guy to be your OSJ, you can pay him/her whatever they want. When I first went with LPL, I paid $500/month to my OSJ (obviously much less than 15% of my gross).  Now, I have my 24, so I don't pay anything for OSJ services.

Dec 20, 2008 12:36 pm

Yup, Just get your Series 24 License within 90 (actually 120) days of coming aboard and you never pay any OSJ over-ride.