MS or ML given my situation

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Apr 3, 2008 7:58 am

Hello all,

Long time reader first time poster.  I love the insight and contributions from posters on their replies.
 
Well, I have been at a major firm for my entire 11 year career and always worked with a large and successful group.  I have done it and do it all therefore have experience managing an entire practice from operations to marketing/prospecting to client relationship management to investment research and recommendations.  My entire career I have chose the safer route of earning a higher salary with the safety of a group.
Over the last two years I have grown tired of funding someone else's retirement and being a "capped" Junior Partner (we can go over my reasons and goals in another topic  lol).
 
But I am ready to make a move with the little book I have built for myself (unfortunatelly all assets/clients I have brought for the team is/stays with the team.
 
I am in final talks with MS and ML.  Both of which are good and reputable firms.  I am entering the training program in order to secure a salary for years 1 and 2.  I figure my asset base can get me first year production hurdles while I aggresively gather assets looking at year 2 and 3.
I am buliding my business plan and my # are aggresive and necessary based on where I want to be 3 years from now (mainly to make up some of what I will be losing in making the move).
Basic # are about 10-15M in assets generating about 92k in gross is what I plan on bringing over and hit the ground running not missing a beat.
 
My initial thought is that the "letterhead" at least initiall is secondary to actual branch - Manager, Other people in branch as my goal is to partner up after 1/2 years, firm technology.
 
I will be asking for the higher end of a trainee salary 70/85K and have been told those #s are not a problem.
 
Does anyone know or could tell me about MS Act for FAs that is intheir system?  I currently use Act on my laptop but would love something imbedded in the system for ease of management.

Any feedback, thoughts, ideas would be greatly appreciated.  Thank you again in advance.
Apr 3, 2008 8:35 pm

 Can't help you with MS act. However, If my reading comp is OK, you have eleven years of experience as a salaried junior group member? If so, that's invaluable experience that should go a long way towards putting you in the top quintile. One caveat, how involved were you in the prospecting? I ask, because prospecting is what your life is going to be about for along time to come. The good news is that you know exactly what you are getting yourself into. With your background you are worth every dime of the high end starting salary and should be able to write your own ticket.


Both MS and ML are good firms. of those two I'd go with ML. However, you left out my favorite firm for trainees, SB. I have no particular reason to pick ML over MS other than its best of class training program. That's not to say MS isn't also very good. It's a close enough choice to have other factors enter into the decision. BOM is the biggest factor. Also, some ML and MS offices have sales managers. I have little respect for these guys because in many cases they have never sold a thing yet in the byzantine world of brokerage management are put in charge of a sales force. Regardless, because of their power they need to be a major factor in your thought process. Support, and overall morale of the office should be weighed. As should be your seating arrangements. Next comes quality of life issues; commute time, office location, section of town, building access. Some of this stuff might sound overboard but its not. Want to go home for dinner and then come back to the office? An office location with an impossible rush hour commute cuts that possibility out of the picture. It's all subjective. but sometimes the little things count as much as the big.


Lastly, from your screen name I'm guessing you have a Jersey connection. If that means you're working in NJ you already know how tough the market is here. It doesn't get easier when you're trying to make your numbers to keep a seat. Eyes wide open. Good luck!
Apr 3, 2008 9:29 pm

My two cents, your in the toughest market there is. MS and ML are both top tier firms, arguably the best.  Your splitting hairs, go with the BOM and Sales Managers (if they exists). That's where you see the major differences.

You don't have to answer if you don't want too, but what were you "capped" at? Is it really that low, and nonnegotiable that you need to leave? I'm not trying to be a softy, or anti-conflict, just wondering why the need for the change. Seems like you had a nice little deal where you were. If you have the extra drive and entrepreneurial spirit to build your own book, great, I'm definitely not knocking you.

SB, UBS, are big on rookies joining "teams".  I would be appreciative to know what I'm walking into on that.

Didn't mean to hijack your post.


Apr 3, 2008 10:48 pm

Good replies by both, thank you and I appreciate it.

 
I will try to respond as honest and candid as possible and would appreciate further dialogue.
 
Well, I have been in a new group.  A large producing aggressive group.
I am the hybrid person in the heart of prospecting, gathering assets, client and investment management.  I do a little of each and do it well.
 
Im in a group where I know, and have been told, I will never become a partner.  Thats ok.
I achieve all my goals (prospecting, asset gathering, gross production).
 
If I am doing it for a group, I could certainly do it for myself.  There are many other reasons for this move; lifestyle and close to home, financial and the ability to get co. stock, pride of building and managing my own business.
I know where Ill be in 2-3 years at my current situation.  Who knows where I could be by making a move.
 
As I put my business plan together I realize I wont be doing anything different than I do now (70% prospecting, 30% client management, research, networking) except work a bit harder.
 
As for branches I am going with my gut and moving farther in talks with MS.  Im happy with how they have courted and been straight shooters with me.  The branch also has partnering opportunities via a connection they facilitated.
 
I figure I work 2 years to get a little ahead of where Im at now financially but owning a business.
 
I realize NJ is a tough market.  I go after IRA rollovers and competition is fierce. 
I also realilze I have a working mentality like no other and I work harder and smarter than 95% of people I know in the business.
 
 
Apr 3, 2008 10:53 pm
Insideman:

My two cents, your in the toughest market there is. MS and ML are both top tier firms, arguably the best.  Your splitting hairs, go with the BOM and Sales Managers (if they exists). That's where you see the major differences.

You don't have to answer if you don't want too, but what were you "capped" at? Is it really that low, and nonnegotiable that you need to leave? I'm not trying to be a softy, or anti-conflict, just wondering why the need for the change. Seems like you had a nice little deal where you were. If you have the extra drive and entrepreneurial spirit to build your own book, great, I'm definitely not knocking you.

SB, UBS, are big on rookies joining "teams".  I would be appreciative to know what I'm walking into on that

Yes, I am in a good position that many would love to be in.  My neighbor in the business wishes I traded him my position.  Fact of the matter is I believe I could be doiong the same, if not better, on my own.
When I mean "capped" is that I feel more like an "employee" than closer to a partner eventhough what I a huge part in the equation.
 
I called the SB office in area and it is such a small branch and the Manager doesnt have room for someone like myself.
Apr 4, 2008 8:47 am

Close to home? Well, Devil, I can't imagine there's much business to be had at the Blue Hole in Winslow NJ, due to it's status as a bottomless pit of crystal clear water and its reputation as a gateway to hell. But as Mrs. Leeds thirteenth child you would know better than I. Because of your appearance I would limit prospecting to the phone at least until people get to know you. And the midnight guest appearances at remote campsites have got to stop until you get things off the ground. And speaking of off the ground, the flying thing is a no-go for now. A good tailor can hide anything, including those wings. Finally, breathmints. People probably don't tell this to your face you being a devil and all, but everyone of the people you've met, who have survived their meeting with you,  has commented on your breath afterwards. There's just no polite way to say this, you have a breath problem. Ok, I said it, now the next hiker you acost pillage some Breathsavers.

 
OK,  a little Jersey Devil folk lore thrown in for good measure.
 
Seriously, you've got a great attitude to match the experiece. You're going to do very well! Welcome to the jungle!
Apr 4, 2008 9:27 am
BondGuy:

Close to home? Well, Devil, I can't imagine there's much business to be had at the Blue Hole in Winslow NJ, due to it's status as a bottomless pit of crystal clear water and its reputation as a gateway to hell. But as Mrs. Leeds thirteenth child you would know better than I. Because of your appearance I would limit prospecting to the phone at least until people get to know you. And the midnight guest appearances at remote campsites have got to stop until you get things off the ground. And speaking of off the ground, the flying thing is a no-go for now. A good tailor can hide anything, including those wings. Finally, breathmints. People probably don't tell this to your face you being a devil and all, but everyone of the people you've met, who have survived their meeting with you,  has commented on your breath afterwards. There's just no polite way to say this, you have a breath problem. Ok, I said it, now the next hiker you acost pillage some Breathsavers.

 
OK,  a little Jersey Devil folk lore thrown in for good measure.
 
Seriously, you've got a great attitude to match the experiece. You're going to do very well! Welcome to the jungle!
BondGuy,
As the biggest NJ Devils fan there is out there I appreciate your little folklore in the Devil.
As far as "close to home" I travel all over the state and go to prospects and clients so having an office close to home helps in many other ways.  But I am often, sometimes 2-3 times a week, up in northern NJ
On the other hand, I am nervous and excited to take the next step in my career.
Like I said, Ive been perusing the Forums for quite some time and love the knowledge and expertise that is here.  Now that I need some veteran "outside of the box" advice I appreciate every reply.
Thanks.
Apr 4, 2008 10:06 am

NJDevil,
Sounds like you're on the right track in terms of taking more control of your destiny.  Just don't delude yourself on the way, or you might derail your own dreams.

First, be aware of any restrictive covenants contained in the written agreements that might restrict your ability to try to take clients as you leave, even those that are "yours."  Don't expect that your former team or firm to sit idly by as you do that.  Far more likely they will attack you legally to make it at least more difficult and expensive to move clients.  This will be easier for them if you will not be able to immediately accept clients during this training period you mentioned (the details of which are unclear so I won't address further).  You may also find that some of "your" clients feel more comfort with the team than with you alone, so they may not follow anyway.  It happens.

More importantly, once you do get running at the new firm, don't be in too big a hurry to jump into another team.  While there may be benefits, there are drawbacks as well, especially in terms of building a business for yourself.  The B/Ds love teams because it makes for clients that are a bit stickier to the firm rather than the FA, so they promote them like crazy.  That doesn't mean you should rush back into another team where you give up some of the very benefits of self sufficiency you seem to be seeking.

Finally, be realistic about "owning a business."  You will not legally "own" a business or even your clients at MS or ML, or any of the wires for that matter - the firm owns them according to the contract you will be required to sign.  Of course in practice you can move most of them if you eventually go independent, but that is really the only way to truly "own" the business - by going independent. 

Given your experience and small but existing established client base, maybe you should be more seriously considering an independent B/D now, instead of simply jumping to another wirehouse team situation.  It's not for everyone, but it may be an option for you.  But you will need to make a big decision about your priorities: either you
put more value on owning a business, or you put more value on the
security of being paid a salary.  You can't have both, so make a
decision which is more important to you.

Apr 4, 2008 10:19 am
Morphius:

NJDevil,
Sounds like you're on the right track in terms of taking more control of your destiny.  Just don't delude yourself on the way, or you might derail your own dreams.

First, be aware of any restrictive covenants contained in the written agreements that might restrict your ability to try to take clients as you leave, even those that are "yours."  Don't expect that your former team or firm to sit idly by as you do that.  Far more likely they will attack you legally to make it at least more difficult and expensive to move clients.  This will be easier for them if you will not be able to immediately accept clients during this training period you mentioned (the details of which are unclear so I won't address further).  You may also find that some of "your" clients feel more comfort with the team than with you alone, so they may not follow anyway.  It happens.

More importantly, once you do get running at the new firm, don't be in too big a hurry to jump into another team.  While there may be benefits, there are drawbacks as well, especially in terms of building a business for yourself.  The B/Ds love teams because it makes for clients that are a bit stickier to the firm rather than the FA, so they promote them like crazy.  That doesn't mean you should rush back into another team where you give up some of the very benefits of self sufficiency you seem to be seeking.

Finally, be realistic about "owning a business."  You will not legally "own" a business or even your clients at MS or ML, or any of the wires for that matter - the firm owns them according to the contract you will be required to sign.  Of course in practice you can move most of them if you eventually go independent, but that is really the only way to truly "own" the business - by going independent. 

Given your experience and small but existing established client base, maybe you should be more seriously considering and independent B/D now, instead of simply jumping to another wirehouse team situation.  It's not for everyone, but it may be an option for you.  But you will need to make a big decision about your priorities: either you put more value on owning a business, or you put more value on the security of being paid a salary.  You can't have both, so make a decision which is more important to you.

Morphius,
Thank you for your comments.
Yes, I am realistic in my overall expectations and about owning the/a business.  Not actually owning but being able to run a/my practice I guess would be the best word.
 
As for grouping... not in a hurry but eventually some kind of partnership is what I will seek.  Only time will tell what opportunities are to be had and what relationships could work.  But my thought about a group is for many reasons; prospecting, marketing, running a business, client service, etc...  that eventually make clients stickier like you said.
 
My short-term goal is having security of being paid, being able to pay the bills, while I work on building a practice year two on based on my business plan.
 
Like you said, I dont want to delude myself and have been very cautious throughout my thinking and rationale.  At the end of the day I see those around me that are doing well and cant help but want to take that step.  I know what it takes and, most importantly, am willing to do what it takes.
The harder you work, the luckier you get.  Plus a little luck wont hurt! lol
Apr 4, 2008 10:49 am
NJDevil:
As for grouping... not in a hurry but eventually some kind of partnership is what I will seek.  Only time will tell what opportunities are to be had and what relationships could work.  But my thought about a group is for many reasons; prospecting, marketing, running a business, client service, etc...  that eventually make clients stickier like you said. 


Just to be clear, because it's an important distinction: clients of a team are sticker TO THE B/D.  This is not a benefit to the individual FA on the team. 


Apr 4, 2008 11:24 am
Morphius:


Just to be clear, because it's an important distinction: clients of a team are sticker TO THE B/D.  This is not a benefit to the individual FA on the team. 

Fair.  But that is not a worry in the short term for me.
I have other things to worry about  lol
 
Thanks again for your input.