When do you throw in the towel?

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Dec 3, 2009 6:17 pm

 I am beginning to side with windy on this one. I just spent 2.5 hours trying to convice some guy with 5 grand to start a roth and contribute another 200 bucks a month. He currently contributes $500 a month to his "retirement account" as he calls it which is a savings account at the bank at .01 percent interest.  I answered every single question and situation he had come up with but he gets on the phone with his uncle who day trades and lost a bunch of money recently and said don't invest. So he went from signing to meh, I will call you. Mind you the guys goal is to retire in 24 years with 2 million... I showed him how to reasonably expect to get to 2 million investing for 35 years by maximizing his Roth and such. Its my own fault tho right? I almost wish EJ didnt give payouts on accounts less than 100k because these people are the hardest to win over and the payout is trivial at best.  But no not me, I think I can and should help anyone with interest in getting to retirement. If they arent ready to start a DCA within the first 20 minutes or have 50k or more to invest I am going to end the conversation, hand them another business card and tell them, "When you are serious about changing your retirement situation so that you can reach your goals, you have my number, I will be happy to help you. It was nice talking to you, goodbye." 

 
So how about you guys when do you end the appointment?
Dec 3, 2009 6:32 pm

it's called experience, and you're gaining more and more with every one of these types of meetings, don't sweat it and move the heck on. when i was building my book, i'd take anything, and sometimes at the cost of almighty time. those meetings suck, we've all had them.

Dec 3, 2009 6:37 pm

Well, I certainingly wouldn't waste more time with someone with that small of an account that is being difficult.  I don't mind helping those smaller accounts, but it's not worth it if they're constantly fighting you and your professional opinion. 

 
However, just because someone has over 100k doesn't mean they act any different.  They can be just as painfull.   Yes, you will make more so maybe it's worth a bit more of a fight to obtain them but those are not people you want to work with.  I have a client with 500k with me and probably 2mm investable assets that makes me jump through hooops to get new business.  I mean multiple meatings to go over the same concept or investment before pulling the trigger to do anything.  Last month I told myself I don't care to deal with this.  Even if it means missing out on 4k when he actually does something.  I told him call me when he's ready to sign papers and anything else can be disgussed on a quick phone call.  Your time is valuable and your clients/prospects should be told this and respect that.  If he wants to listen to uncle eddie, tell him good luck and show him the door. 
Dec 3, 2009 6:43 pm

Dont be so hard on yourself. Mr. Sunshine is right, you are learning and as time goes on you will figure out those arent worth it. Im at a bank and you get absolutely drilled if someone finds out you are trying to institute an account minimum. In the last 6 months I have been shuttling people to the no load in state 529 and the Scottrade down the street if they are under 25k. Tell the prospect that those places are the most cost effective way to go for their needs and tell them to use an age based plan or target retirement fund. I have actually had two guys say, "Well what dollar amount makes sense for me to work with you?" I say 50k and there you go, managed account minimum.

Dec 3, 2009 6:44 pm

Thanks guys. Really I just needed to vent, an easy sale turned out to be a disappointment. I agree that larger isn't always better Baldy, however, 4k net is worth a hoop or 3, for now at my stage. I just meant in general people without a decent amount of money to invest are usually new to the market and are intimidated or overly skeptical of a guy in a suit, so it takes longer to cultivate trust and or educate them on fundamentals.

Dec 3, 2009 6:49 pm
 
Dec 3, 2009 6:54 pm
fa09:

 I am beginning to side with windy on this one. I just spent 2.5 hours trying to convice some guy with 5 grand to start a roth and contribute another 200 bucks a month. He currently contributes $500 a month to his "retirement account" as he calls it which is a savings account at the bank at .01 percent interest.  I answered every single question and situation he had come up with but he gets on the phone with his uncle who day trades and lost a bunch of money recently and said don't invest. So he went from signing to meh, I will call you. Mind you the guys goal is to retire in 24 years with 2 million... I showed him how to reasonably expect to get to 2 million investing for 35 years by maximizing his Roth and such. Its my own fault tho right? I almost wish EJ didnt give payouts on accounts less than 100k because these people are the hardest to win over and the payout is trivial at best.  But no not me, I think I can and should help anyone with interest in getting to retirement. If they arent ready to start a DCA within the first 20 minutes or have 50k or more to invest I am going to end the conversation, hand them another business card and tell them, "When you are serious about changing your retirement situation so that you can reach your goals, you have my number, I will be happy to help you. It was nice talking to you, goodbye." 

 
So how about you guys when do you end the appointment?

The real issue is that you don't have a full pipeline.  If you did, you wouldn't have time to talk to a non-prospect for 2 1/2 hours. 
Dec 3, 2009 6:58 pm

Part of the reason that you lost this sale is that you were trying to compete with something with no investment risk, his bank account.   Turn the competition into something in which you get paid no matter what choice he makes. 

 
For instance, let's assume that you put together an American Funds portfolio.  You could have given him the choice between that and a fixed annuity.  Since his uncle told him not to invest, the logical choice would have been the fixed annuity.  You would have gotten paid, he would have gotten a much better rate of return.  It's the classic win/win.
Dec 3, 2009 7:05 pm

Thanks Ron when and if I institute an account min I will def use that. As for the pipeline situation, its not overflowing but there is more than enough bus to keep me and jones happy for now, its just that I'm naive enough to think I can close every appt I set. As far as annuities and fixed income goes I offered but his religion doesn't allow for insurance and or interest. He really isn't even supposed to be receiving the .0001 he is getting but its so small that he said it doesn't bother his conscious. It was seriously fine until Uncle Bob got involved... now he and his uncle want to sit down sometime. I really wanna blow them off or cancel last minute. Any thoughts?

Dec 3, 2009 7:15 pm

WTF???  His religion doesn't allow insurance or rate of return???  If he's not supposed to be getting the .00001% at the bank then doesn't that give you the answer as to why he won't invest with you?  If you get him 10% return he may have to renounce his faith.

 
What kind of f***ed up religion works like this?
Dec 3, 2009 7:17 pm

fa09, you're thinking like an employee.  If you are doing what you should be doing, you'll be far ahead of what you need to keep Jones happy.  It's still a pipeline issue.   If you had a full schedule, you simply couldn't be spending time with non-prospects.  What are you going to sell a guy who can't earn interest?  Why would you cancel last minute?  Does that mean that you don't have the balls to simply not set up the appointment?


Think like a business owner!
Dec 3, 2009 7:17 pm

He can't collect interest or insurance. He CAN INVEST in a company and share in its profits. So he can buy a stock or MF. You haven't encountered this before? I have a few prospects that are muslim, none that I have closed yet.

Dec 3, 2009 7:19 pm

Absolutely cancel.  Its a 5k account.  spend that two hours door knocking at it'll yield more long term than that guy.  You can still be professional and curious about it but I would let the guy know that is not how you conduct business. 

 
"Mr. Prospect, I understand that you repsect your uncle's opinion and that is fine.  However, based on our previous meeting, I think it is clear that you value his opinion in regards to financial planning more than mine.  I don't care to compete with his opinion on where you should or should not invest your money.  At this time, I don't think the 3 of us meeting together a value to any of our times as he has his opinion and I have mine.  I wish you both the best." 
 
I also like both of anonymous' posts.  Keeping working hard and build that pipeline and you wont want to fight for this type of account.  And have two ideas ready: Market and Fixed.  But honestly, this type of person would find reasons to not like your fixed idea too.  The maturity is too long, the rate is to low, I don't trust that insurance company, I'll keep it at the bank until CD's are back to 6% and then I'll invest,... you get the point.  These people are NEVER happy. 
Dec 3, 2009 7:22 pm

Thanks anon. That puts things in a better perspective. I didn't really have the time to meet with the guy for 2.5 hours but I got sucked in. I am ahead of goals by a few 100 percent however I could always do much better especially with the beginners goals Jones gives us the first 2 years.

Dec 3, 2009 8:37 pm

The guy is probly thinking why is a financial advisor wasting his time on someone with only 4k.

Dec 3, 2009 8:41 pm
fa09:

He can't collect interest or insurance. He CAN INVEST in a company and share in its profits. So he can buy a stock or MF. You haven't encountered this before? I have a few prospects that are muslim, none that I have closed yet.


 
If the mutual fund has some money in cash, isn't he earning interest? 
 
I need to make a profit.  If a prospect is difficult and won't be very profitable, I won't work with them. 
 
I have Muslim insurance clients.
Dec 3, 2009 8:58 pm
anonymous:
fa09:

He can't collect interest or insurance. He CAN INVEST in a company and share in its profits. So he can buy a stock or MF. You haven't encountered this before? I have a few prospects that are muslim, none that I have closed yet.


 
If the mutual fund has some money in cash, isn't he earning interest? 
 
I need to make a profit.  If a prospect is difficult and won't be very profitable, I won't work with them. 
 
I have Muslim insurance clients.
 
Me too...sold a $3 million buy-sell and $3 million individual term to a small business owner several months back.  He didn't have a qualm w/anything about it. 
 
Also, what would dividends be characterized as?  It's not price appreciation, but similar to interest in that its a relatively fixed % that an investor will be paid on their money quarterly or monthly.
Dec 3, 2009 8:59 pm

That's why I admire BioFreeze's business model.  He has a product.  He sells as much as he can to as many people as he can.  If the product isn't a fit, the person isn't a prospect.

Dec 3, 2009 9:33 pm

Don't waste time on DCA's unless they have at least $75K.. just because jones doesn't set minimums, doens't mean you can't..

Dec 3, 2009 9:49 pm

I wouldn't be so worried about setting account minimums while being a rookie at Jones, but I'd set a standard for the type of client you want to work with.  Dealing with narrow minded idiots that don't value your time or opinion and are difficult are not the type of people you want. 

 
Your first few years at Jones those smaller accounts are still good (assuming they are easy to work with)  because they allow you to practice face to face appointments, work on your presentations, builds some confindence because you opened an account from prospecting and also helps you pad those stats like new accounts opened,etc.  If you're doing well after a few years then maybe start being more selective on account minimums.