EDJ...30 months out and wanting out

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Oct 18, 2008 3:16 pm

I took over an office...of course  I am the 5th broker in 7 years. I am doing okay but they are adding two new offices in my area...I am very tired of trying to bring in new business.  I know they say you can make a lot of money..since my salary has been gone my checks are very small most months.  Even the good months are small by the time everything comes out of them. I am above standard  The networking piece is okay BUT the door knocking sucks!!! I actually hate door knocking on residential. (small buiness owners are great, most of them are chamber members.)...I have 2 questions


1. How much if I switch to a bank or another firm would I owe EDJ? (can't find my origianal contract)
2. Is there any way to have a salary and some commision?  What options are there for me?
 
 
Oct 18, 2008 4:14 pm

I'm not an EDJ employee although I did at one point go through their interview process and recall the fact that a) there is no non-compete and b) there is a three-year period before which you will owe the firm 'training costs.'   They're coming after a friend of mine for 75k who took his licenses elsewhere. Since you're only six months away, why not take that issue off the table by waiting six more months. Having done the work of a full service environment, I would not move that book into a bank. Depending on your assets brought in and in the office you inherited, you may have a good situation at a wire which would provide a two-year base. Or just go indie and bump up your payout. No door knocking at a bank but much more restrictive environment.

Oct 18, 2008 4:18 pm

I asked a similar question -- what options are there -- in a post a couple of weeks ago. 'What Else is there' was the topic. It got some good responses.

As for question No. 1, it is probably best to ask an attorney. I think -- I think -- you are off the hook for training costs after three years.

Oct 18, 2008 4:52 pm

Yur friend who left that is looking at 75k how many months out was he? Thanks I will look at the "what else is there" thread..


I am just tried of a lot of things at jones...most of all the good old boys club.
Oct 18, 2008 6:43 pm

With just 6 months to go, you could probably negotiate it down. When you get the attorney's paperwork from them, make sure your attorney answers it. It will probably be like 15-25K. They can probably negotiate it down to like 5-7K. Hopefully your new BD will pick that up (you shoudl negotiate that into new contract).



FYI - you're still going to need to prospect. The bank is no Golden Goose. Even Top Producers still prospect. You don't have to doorknock, there are many other ways to do it. But it sounds like you haven't developed those other processes yet (seminars, networking, referrals, etc.).

Oct 18, 2008 8:43 pm

I have been doing seminars and have been very sucessful with networking. I just can not stand door knocking...My numbers are fine according to their standards. It just when your town has been door knocked by 4 other brockers it is not very effective....My referrals are starting, I feel if the market was to turn around this would also help...it has been a rough 18 months. I have just had my two best month ever....Starting at zero every month ...actually I start in the hole ever month, because of office expenses and postage, this is really hard to take.

I understand that when you make more money your expenses do not go up as much as the money you make. When you are new the percentage of what you make each month that goes to expenses is really high.
Oct 19, 2008 7:32 am

My friend quite after 7 months in. He left because they were jerking him around on getting his office even though he hit the required numbers to do so. A partner in a nearby branch objected to the location or had some other conflict. I don't believe your contract states that the 75k decreases proportional to your time served; it may be 3 years or nothing, so why not just wait it out. That said, I don't know a single person who has ever paid up to EDJ, and a couple who haven't even been asked to after leaving despite an affiliation with a subsequent firm.

Oct 19, 2008 9:37 am
xbanker:

My friend quite after 7 months in. He left because they were jerking him around on getting his office even though he hit the required numbers to do so. A partner in a nearby branch objected to the location or had some other conflict. I don't believe your contract states that the 75k decreases proportional to your time served; it may be 3 years or nothing, so why not just wait it out. That said, I don't know a single person who has ever paid up to EDJ, and a couple who haven't even been asked to after leaving despite an affiliation with a subsequent firm.





X, your facts are actually off a bit. Plenty of people get the attorney letter. Many pay up. Most negotiate it down. And the contract does pro-rate the amount owed.

Oct 20, 2008 10:06 am
monopolybet:

I have been doing seminars and have been very sucessful with networking. I just can not stand door knocking...My numbers are fine according to their standards. It just when your town has been door knocked by 4 other brockers it is not very effective....My referrals are starting, I feel if the market was to turn around this would also help...it has been a rough 18 months. I have just had my two best month ever....Starting at zero every month ...actually I start in the hole ever month, because of office expenses and postage, this is really hard to take.

I understand that when you make more money your expenses do not go up as much as the money you make. When you are new the percentage of what you make each month that goes to expenses is really high.
 
I feel ZERO pity for you on the doorknocking thing.  Within a 1-1.5 mile radius of my office are 12 EDJ FAs.  6 of them have been out under two years and are doorknocking.  That doesn't count the other 6 who have been through here in the last several years.  If you don't like doorknocking residentials, figure something else out.  BTW, moving to a different firm or a bank is a short term fix. 
 
And your thought process on the market going up tells me you don't understand this business at all.  If there was ever a time to suck it up and go ring your neighbor's doorbell its right now.  Stop reading this, grab your notbook and go ring the doorbells.  People are hungry for information.  Willing to talk to you.  The longer this market stays down, the better for you.  
 
If you don't want to doorknock, do a ton more seminars.  One a week.  They don't have to be big and fancy, just somewhere that people can go to hear what's going on in this market.  If you haven't found the Outlook and Opportunities seminar and presented it to your clients and their friends yet, do it now. 
 
You are three years out.  Your paychecks aren't supposed to be big yet.  If you didn't understand that going in, then you either didn't do your homework or you only heard what  you wanted to hear from the recruiter.  It SUCKS building a business.  Any business.  So quit whining and get back to work. 
Oct 20, 2008 12:27 pm

Geeze, GREAT POST SPIFF!  Goodluck Monopoly, I think the 7/11 by my house may be hiring.

Oct 20, 2008 5:50 pm

That was a great post, Spiff. Well done.

 
 
Oct 20, 2008 8:36 pm

Thanks spiff...I will give it another try..to get out there more, and less in front of the desk...as far as the better market..is not so much for new people, but people who (especially new people under 25 k put in an A shares) whose accounts have done nothing but go down..takes a while to figure out that you won't get hit by a car when you cross the road if you offer a b or c share option on small amounts!!! Just realizing that the people you invested in the market, could have been a little more defensive in the portfolio...knowing as a newbie you do not know it all...It keeps me up at night...sorry I sounded so lazy..mostly I am afraid of making a mistake....I really want to do my job well.  I guess I am just frustrated and very discouraged. I did not know how hard this job is and trying to provided for a family and another baby on the way!!

Oct 21, 2008 7:54 am

Spiff is right short term, wrong long term. Right that you do have to suck it up and do a very hard job. Wrong in that I've seen many bright, hard-working, decent people wash out at Jones -- so what they're doing to develop their advisors doesn't seem to be working. You don't see this in other industries. Even military boot camp instructors do a better job getting their trainees into the field.


Oct 21, 2008 9:09 am
"I've seen many bright, hard-working, decent people wash out at Jones -- so what they're doing to develop their advisors doesn't seem to be working. "
 
It's not just Jones - it's the entire industry.
Oct 21, 2008 9:27 am
buyandhold:

Spiff is right short term, wrong long term. Right that you do have to suck it up and do a very hard job. Wrong in that I've seen many bright, hard-working, decent people wash out at Jones -- so what they're doing to develop their advisors doesn't seem to be working. You don't see this in other industries. Even military boot camp instructors do a better job getting their trainees into the field.


 
You're right.  We don't know how to do anything right.  We don't know how to recruit, hire, and train anyone to be successful.  Nobody ever makes it at Jones.  The good ones all leave and go independant.  The bad ones stick around and sip the kool aid all day long.  We suck.  Spears is right.  I'm leaving.  I think I'll go join Primerica. 
Oct 21, 2008 10:00 am

ej is about to see the biggest departure rate ever seen in this environment. the transactional broker will starve. noone wants to invest so the commission broker is done.

Oct 21, 2008 10:04 am

It took you long enough to admit it spiff.  I, however, would suggest a smooth transition for you to "AMWAY"....good luck and good selling.

Oct 21, 2008 11:31 am
ezmoney:

ej is about to see the biggest departure rate ever seen in this environment. the transactional broker will starve. noone wants to invest so the commission broker is done.

 
??
 
EZ, were you aware that we have grown 9%+ this year?  When is this "departure" anticipated?
Oct 21, 2008 11:35 am

And on the "commissioned broker is done" thing....

 
I personally dislike the commission model.  But to be honest, I don't think it will EVER be dead.  There are many, many, many people out there adamantly opposed to paying fees.  Now, for people that want a true "advisory" relationship where they are actually getting something for their fees - yes.  But not all clients want or need that.  And one thing that will prevent this from happening - there are probably as many CPA's that support the commissioned model as not (and that oppose fees).  And as we all know, CPA's are the "respected voice of reason" for many clients.
Oct 21, 2008 12:25 pm
ezmoney:

ej is about to see the biggest departure rate ever seen in this environment. the transactional broker will starve. noone wants to invest so the commission broker is done.

 
So, if transactional brokerage is done, why are my clients buying all these great muni bonds this week?  Oh yeah, because I'm calling them to tell them to buy them.  I'm creating transactions.  Hmmm...doesn't sound like starving to me.  And we haven't even mentioned the stocks my clients are buying.  No one wants to invest?  Really?  Buffet must be a complete idiot.  And my clients who are following his advice seem to be bringing serious money to the table. 
 
But, in case you're right, since you so often are, I'll brush off my resume.  Maybe I can use spears as a referral on my Amway resume.  Or maybe he can just sign me up under himself.