CPA to EJ?
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I would do a little more research. I am at Jones currently. I wish I new then what I know now. I don’t know what I would have done differently, but I definately would have dug a little deeper into the financial planning world. Don’t expect to make much at jones your first number of years.
The challenge, as with any newbie in this business, is that it’s tought to start ou on your own without a major firm or quality indy firm to train you. It’s sort of like the CPA world. You really need about three years of good “äpprenticeship” before you really get it.
Tryin to build a tax practice from scratch (which he has probably not done before - he probably is an auditor) while also building an advisory practice from scratch will be an uphill battle, so you just need a lot of capital (or low cost of living) for a few years to get going. But the good news is, you can usually pick up a quick 100-150 tax returns (the cheaper ones) in your first few years if you work it hard. Nice thing about the tax business is that you can spend much of the "öff season" prospecting. However, you almost MUST have at least one assistant to be able to complete any volume of returns. But if you do it right, you can keep the number of returns you do small and manageable to generate some recurring cash flow, and over time build up your assets under management to the point where you can stop taking new returns and actually cut back through attrition and price increases. Doing tax returns is not a real fun business (for most).I agree with AG and ICE… You need to leverage your CPA status, not knock on doors like college kids do(me). Don’t diminish you stature because of firm policies.
I agree Wirehouse or Indy firm(while maintaining tax practice)[quote=Still@jones] [quote=82391]
"Here is how we explain 50-60% failure rates.... How do you plan to prospect?(I will await your response)" Well being from a non sales background, I was banking on EJ providing me the tools and recipe for success. It seems as if door to door has to be the largest portion, and most of my time up front will be pounding the pavement it sounds like. I do have a decent network of accountants and lawyers that I both work with and went to school with, but am not banking on that being a significant portion of assets. So I guess the answer is knocking on hundreds of doors hoping for maybe 5% of them being real quality contacts and building from there. Is that what you were looking for?[/quote]I went from CPA to an FA and let me tell you. Do not "bank" on anything with these firms, any of them. They are just a platform for you to sell you. Period. This is a sales job, make no mistakes about it. Leveraging your "network" is fine but if you are just starting out in this business, those CPA/Atty will pass you some business but need to do more prospecting on your own. This "sales" idea was a big shift for me vs. well mr. smith I have a public accounting/tax/SEC audit background...it means squat, honestly. I would look into what others have said in possibly joining a small cpa firm, and either joining their own investment wing in conjunction with still doing accounting work or start your own RIA (search the board on how to do it, i also suggest contacting Fred from Trade-PMR on this board) along with doing some work for a cpa firm. Speaking from someone who has made mistakes, you better makes sure you realize what you are getting into. There is a lot of BS on this board but there are a lot of great resources who speak the truth. Good luck
Thank you so much for the great replies!!! I am so greatful that I found this website as I was pretty much convinced I was making the jump to EJ. I do think that I need to leverage my CPA in a smarter way, so I am going to tell Edward Jones that I am no longer interested. Also, if anyone has any additional input I would love to hear it!
Regarding some of the posts, can someone maybe help me out with some of the acronyms/terms that you all use? Some that I am not familiar with are wirehouse and RIA. Sorry if I sound somewhat ignorant on the subject, but I just kind of fell upon this opportunity and it sounded great at first so I don't have much knowledge on the rest of the industry. I will continue doing research and am hoping to mesh the two careers into one to hopefully make some great money! Thanks again! j[quote=Squash1]
I am pretty sure you can only use the seminar rebate once a year(used to be at EDJ)... Plus I meant big seminars, 5000 mailings, 30 dinners, $1000 just for dinner type..
[/quote] Just to clarify, you can use the seminar reimbursement as often as you want. It has to be a qualified seminar that you're giving, but if you wanted to give the same seminar every Thursday, Jones would reimburse you 75% as a new FA for all of them.[quote=82391]Thank you so much for the great replies!!! I am so greatful that I found this website as I was pretty much convinced I was making the jump to EJ. I do think that I need to leverage my CPA in a smarter way, so I am going to tell Edward Jones that I am no longer interested. Also, if anyone has any additional input I would love to hear it!
Regarding some of the posts, can someone maybe help me out with some of the acronyms/terms that you all use? Some that I am not familiar with are wirehouse and RIA. Sorry if I sound somewhat ignorant on the subject, but I just kind of fell upon this opportunity and it sounded great at first so I don't have much knowledge on the rest of the industry. I will continue doing research and am hoping to mesh the two careers into one to hopefully make some great money! Thanks again! j[/quote] Let me get this straight ... you have an opportunity with a company ranked in the top ten places to work 9 out of the last 10 years; that, in a survey by this very site, has been ranked #1 for the last 17 years (beating the other firms that have been recommended to you - the wirehouses); and that was ranked best by JDP three out of the last four years ... because of things you read on a blog site? Exactly which firm do you think is better than the one that's ranked number one? And you're going to turn them down before you can even define RIA??? While people like Icecold can make it, I think even he would tell you that going independent RIA from the outset is truly stacking the deck against you. But hey, best of luck to you.[quote=LockEDJ][quote=82391]Thank you so much for the great replies!!! I am so greatful that I found this website as I was pretty much convinced I was making the jump to EJ. I do think that I need to leverage my CPA in a smarter way, so I am going to tell Edward Jones that I am no longer interested. Also, if anyone has any additional input I would love to hear it!
Regarding some of the posts, can someone maybe help me out with some of the acronyms/terms that you all use? Some that I am not familiar with are wirehouse and RIA. Sorry if I sound somewhat ignorant on the subject, but I just kind of fell upon this opportunity and it sounded great at first so I don't have much knowledge on the rest of the industry. I will continue doing research and am hoping to mesh the two careers into one to hopefully make some great money! Thanks again! j[/quote] Let me get this straight ... you have an opportunity with a company ranked in the top ten places to work 9 out of the last 10 years; that, in a survey by this very site, has been ranked #1 for the last 17 years (beating the other firms that have been recommended to you - the wirehouses); and that was ranked best by JDP three out of the last four years ... because of things you read on a blog site? Exactly which firm do you think is better than the one that's ranked number one? And you're going to turn them down before you can even define RIA??? While people like Icecold can make it, I think even he would tell you that going independent RIA from the outset is truly stacking the deck against you. But hey, best of luck to you.[/quote] C'mon Lock. He is still in the gathering information stage of his search....why would he want to make a career decision before he has all the facts. Whether the company is best in the industry makes no difference if the opportunity isn't right for him. BTW, they aren't best in the industry.....or maybe they are to the 385 people polled.....[quote=LockEDJ][quote=82391]Thank you so much for the great replies!!! I am so greatful that I found this website as I was pretty much convinced I was making the jump to EJ. I do think that I need to leverage my CPA in a smarter way, so I am going to tell Edward Jones that I am no longer interested. Also, if anyone has any additional input I would love to hear it!
Regarding some of the posts, can someone maybe help me out with some of the acronyms/terms that you all use? Some that I am not familiar with are wirehouse and RIA. Sorry if I sound somewhat ignorant on the subject, but I just kind of fell upon this opportunity and it sounded great at first so I don't have much knowledge on the rest of the industry. I will continue doing research and am hoping to mesh the two careers into one to hopefully make some great money! Thanks again! j[/quote] Let me get this straight ... you have an opportunity with a company ranked in the top ten places to work 9 out of the last 10 years; that, in a survey by this very site, has been ranked #1 for the last 17 years (beating the other firms that have been recommended to you - the wirehouses); and that was ranked best by JDP three out of the last four years ... because of things you read on a blog site? Exactly which firm do you think is better than the one that's ranked number one? And you're going to turn them down before you can even define RIA??? While people like Icecold can make it, I think even he would tell you that going independent RIA from the outset is truly stacking the deck against you. But hey, best of luck to you.[/quote] Well, to clarify I have been gathering information from as many people as possible on both sides of the industry, so please don't think I made a decision based on forum responses (however I do feel they were helpful). I happen to work for a firm right now that is always very highly ranked in those surveys as well, and I must say that I don't know how much those really mean. I think my opportunity is somewhat unique from most who join the profession in that many small CPA firms also have investment practices. I think my efforts will be better spent trying for one of those positions in which will not involve going door to door, and will allow me to earn a significantly better salary on the knowledge that I have, not the amount of people I can successfully sell to. It just really makes more sense to me at this point than going somewhere where my prior background and knowledge gained means absolutely nothing. To add a bit of information, I also have a degree in finance, and consider myself a fairly knowledgeable investor. Ideally I would love to go somewhere where those skills are worth something. I don't feel they are worth much at all at Edward Jones. Please correct me if I am wrong. Thanks again, jEDJ, the company, will look at your background and it might get you an interview easier than if you didn't have the degree and CPA certificate. Beyond that, they won't care if you had your CPA, because you won't be able to put it on your business cards. They won't care if you have a degree in finance either. You might as well have a degree in music theory for all they care.
What will matter to them after the initial interview process and exams is your ability to sell your products and services to potential clients. Having degrees, certifications, blah blah blah in this business is great. It makes you more knowledgable when working with your clients. It doesn't guarantee success or make it easier for you, however. You still have to convince hundreds of people that you can manage their money better than their current guy. EDJ cares how many times you can get that job done. Lots of really smart finance majors get into this business and can't ever figure it out. Just FYI, the only time you have to go door to door with Jones is during training. After that, if you can build your business without it, more power to you. Out of curiosity, what makes you a fairly knowledgeable investor?[quote=Spaceman Spiff]
EDJ, the company, will look at your background and it might get you an interview easier than if you didn't have the degree and CPA certificate. Beyond that, they won't care if you had your CPA, because you won't be able to put it on your business cards. They won't care if you have a degree in finance either. You might as well have a degree in music theory for all they care.
What will matter to them after the initial interview process and exams is your ability to sell your products and services to potential clients. Having degrees, certifications, blah blah blah in this business is great. It makes you more knowledgable when working with your clients. It doesn't guarantee success or make it easier for you, however. You still have to convince hundreds of people that you can manage their money better than their current guy. EDJ cares how many times you can get that job done. Lots of really smart finance majors get into this business and can't ever figure it out. Just FYI, the only time you have to go door to door with Jones is during training. After that, if you can build your business without it, more power to you. Out of curiosity, what makes you a fairly knowledgeable investor? [/quote] I agree with everything you said, and I guess the scary part is that not coming from a sales background is that I'm not certain of how well I could sell. I know I can learn everything quickly, but I feel like selling is something you have or you don't. As far as being a knowledgeable investor, the investment courses in college, lots and lots of research on investing and the markets in my own free time, and putting my learnings to the test by investing my savings into the market. It has been a slow learning process, but feel like I am probably more knowledgeable than the average financial advisor at this point (at least from the ones I have met, since they are more or less just salesmen). Being able to read the financials and understand the way different transactions affect them also is plus that I have taken from my accounting experience. But, like I said I am in the information gathering process. I honestly am looking at several career options now and trying to decide what the best path is for myself.[quote=noggin] [quote=82391]… so I am going to tell Edward Jones that I am no longer interested…
[/quote]
Seemed that way to me based on the statement. While my own time with Jones has a clock attached to it, I’d still be willing to defend the home team … and I’ll throw that “best in the business” thing in there, if only to beat WeddleMe to the punch.
To respond directly to “being a knowledgeable investor” … I don’t know that that is an essential requirement. In fact, it may be a hindrance. Let me explain …
As knowledgeable investor, your instinct will be to tell clients about how wonderful and intelligent your selections are. Here’s a hint: they don’t care. Worse yet, when some of your decisions fail then you too will be a failure - because your validity was built on sand. All of the “good investors” in my class at KYC failed at this job. The successful ones just did the job as described.
The job is about trust, it’s about being secure in your knowledge and sounding like you know what you’re talking about in around 10 seconds. A grasp of PE, Markowitz, alpha and bond convexity don’t mean squat. Your CPA degree will be huge in that arena (they’ll just believe you immediately) but I still think that trust is earned from the pupils out.
82391,
The only thing I will say (based on your posts only) is that you need to be careful about assuming that going to a CPA firm to do investment work will not involve you bringing in clients. I think many that try to get into this profession have the misguided notion that there are lots of clients out there for the taking, that will just be handed to you. Now, the case may be that a well-established firm could hire a newbie to help do some planning or something for existing clients, but if you think you are going to get some portion of the AUM fees to do it, you are probably wrong. You will likely be given a small-ish salary and maybe a bonus. For the most part, people in this business make a lot of money because they bring in a lot of assets (or have brought in a lot of assets already, or have bought a lot of assets, or have inherited a lot of assets from a relative (which you typically buy anyway)). My point is, there is a risk/skill/reward concept in our industry. You don't just get hired by a firm, handed $50mm and start collecting all the fees. It simply doesn't work that way. My point is not to steer you towards Edward Jones, or a wirehouse, or any firm in particular. Just remember, in order to earn the type of salary you would get working at a Big 4 (or is it Big 3 now?) firm, you actually have to earn it. At CPA firms, that usually involves lots of work and a certain degree of years. In our industry, it's about what you have brought in (sort of like law firms). And actually, the same can be said for your typical small local tax/CPA firm. The tax/CPA guy makes the money. He hires some grunts to prepare most of the returns and then he checks them (or he hires checkers). But he is being compensated for (1) taking the risk to build the firm, (2) having the skill to know the tax laws, keep up with laws, communicate and train his employees, and (3) bringing in the clients. I hope this makes sense and you understand what I'm trying to say. I really don't think it matters where you go, as long as you understand what the upside/downside is of each choice. If you just get hired by a local CPA firm to help their investment "arm" you will likely just be given a modest salary and some sort of bonus. Now as you develop, they may hand you some small clients and let you get compensated on it. And maybe you will be well compensated for clients you bring in. But at the end of the day, the bulk of your "excess" compensation (that is, above $100K or so) will be the result of your ability to bring in clients yourself. Of course, there are exceptions to all of this. But by and large, you are going to need to bring in your own clients to make a pretty decent living in this business.One caveat to my post above…taking that route - starting out with a small salary, doing some basic planning, and learning the business that way, may actually be more rewarding and secure than doing it the “typical” shotgun approach that most people use getting into this business (the “wirehouse” way that most of us experience). After a few years doing what I mentioned above, you could start to develop relationships, and start getting referrals, and networking, whatever. The downside is, those may not be “your” clients. They may be clients of the firm. And those clients may be pretty sticky to the firm, especially if they are tax clients. So just think about that.
[quote=B24]82391,
The only thing I will say (based on your posts only) is that you need to be careful about assuming that going to a CPA firm to do investment work will not involve you bringing in clients. I think many that try to get into this profession have the misguided notion that there are lots of clients out there for the taking, that will just be handed to you. Now, the case may be that a well-established firm could hire a newbie to help do some planning or something for existing clients, but if you think you are going to get some portion of the AUM fees to do it, you are probably wrong. You will likely be given a small-ish salary and maybe a bonus. For the most part, people in this business make a lot of money because they bring in a lot of assets (or have brought in a lot of assets already, or have bought a lot of assets, or have inherited a lot of assets from a relative (which you typically buy anyway)). My point is, there is a risk/skill/reward concept in our industry. You don't just get hired by a firm, handed $50mm and start collecting all the fees. It simply doesn't work that way. My point is not to steer you towards Edward Jones, or a wirehouse, or any firm in particular. Just remember, in order to earn the type of salary you would get working at a Big 4 (or is it Big 3 now?) firm, you actually have to earn it. At CPA firms, that usually involves lots of work and a certain degree of years. In our industry, it's about what you have brought in (sort of like law firms). And actually, the same can be said for your typical small local tax/CPA firm. The tax/CPA guy makes the money. He hires some grunts to prepare most of the returns and then he checks them (or he hires checkers). But he is being compensated for (1) taking the risk to build the firm, (2) having the skill to know the tax laws, keep up with laws, communicate and train his employees, and (3) bringing in the clients. I hope this makes sense and you understand what I'm trying to say. I really don't think it matters where you go, as long as you understand what the upside/downside is of each choice. If you just get hired by a local CPA firm to help their investment "arm" you will likely just be given a modest salary and some sort of bonus. Now as you develop, they may hand you some small clients and let you get compensated on it. And maybe you will be well compensated for clients you bring in. But at the end of the day, the bulk of your "excess" compensation (that is, above $100K or so) will be the result of your ability to bring in clients yourself. Of course, there are exceptions to all of this. But by and large, you are going to need to bring in your own clients to make a pretty decent living in this business.[/quote] I appreciate the lengthy post. I by no means expect to walk into an investment firm and expect for them to hand over 50MM in assets to let me manage and pay me as if they were my own. I do like the idea however, of starting at what you are calling a small-ish salary (which honestly probably wouldn't be much less than I make now) to gain experience and later on get paid to bring in clients. This really is not that different from that of a big 4 firm (yes, still big 4 even though KPMG is half the size of the rest) in that once you make manager you are rated on the work you bring in and compensated accordingly. It is not commission based, but moving higher than manager requires meeting certain revenue goals. Again I appreciate the posts, well other than the ones that try to pick apart pieces of what you say and don't give much clarity in their responses. Changing careers is an incredibly hard decision I must say!It makes more sense to be able to utilize a credible piece of your resume: your CPA. You need to go to a place that will allow you to market it and even practice as a CPA.
You want to know about RIA’s? PM me, or Fred from TradePMR or Zach Gronich at RIA in a box.
Those guys know what they are doing and won’t screw you over. Plus, Zach is a CPA and PFS, so knows the CPA side of the RIA world.
I have to disagree with Lock - it makes no sense for someone with a CPA to go there. Just as if you had a Ph.D. - you can’t put that on your business card either.
By having a CPA, it will make prospecting much easier, but not at Jones.
I think you just hit on exactly the way I am looking at it. My original post was concerned with finding out why so many fail at this career. By taking this approach, I can make some decent money with hopefully the same longer term potential of that of an Edward Jones associate. Obviously opportunites to make partner exist in CPA firms in which they would become "my" clients. That's an ambitious goal, but I wouldn't think any more ambitious than starting out from scratch with no clients and building a successful business of my own at a firm like Edward Jones. Definitely ideas to think about...One caveat to my post above…taking that route - starting out with a small salary, doing some basic planning, and learning the business that way, may actually be more rewarding and secure than doing it the “typical” shotgun approach that most people use getting into this business (the “wirehouse” way that most of us experience). After a few years doing what I mentioned above, you could start to develop relationships, and start getting referrals, and networking, whatever. The downside is, those may not be “your” clients. They may be clients of the firm. And those clients may be pretty sticky to the firm, especially if they are tax clients. So just think about that.
I agree with you Mo. Might be a good idea to go out and do some old fashioned interviewing at some local RIA or Indy firms (or CPA firms that offers investments). Not a job interview, but an informational interview to get their perspectives.
But definitely leverage that CPA certificate.
You're taking the analogy too far. By what your saying it is better to know nothing and hand the client an American Funds brochure than to know something about investing. Just because someone is able to rattle off the definitions of R-squared, P/E ratio, alpha, beta, etc. doesn't mean that they would actually do it in front of a prospect. Being a "knowledgable investor" is definitely not a hindrance as long as they don't spend 75% of a client meeting boring them to death with definitions of terms.To respond directly to “being a knowledgeable investor” … I don’t know that that is an essential requirement. In fact, it may be a hindrance. Let me explain …
As knowledgeable investor, your instinct will be to tell clients about how wonderful and intelligent your selections are. Here’s a hint: they don’t care. Worse yet, when some of your decisions fail then you too will be a failure - because your validity was built on sand. All of the “good investors” in my class at KYC failed at this job. The successful ones just did the job as described.
The job is about trust, it’s about being secure in your knowledge and sounding like you know what you’re talking about in around 10 seconds. A grasp of PE, Markowitz, alpha and bond convexity don’t mean squat. Your CPA degree will be huge in that arena (they’ll just believe you immediately) but I still think that trust is earned from the pupils out.