Is this fair? LPL question

or Register to post new content in the forum

 

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.
Jul 16, 2010 10:24 pm

I met with an independent firm today - an LPL shop.  I'm new to independent channel and wanted to get your opinion on the comp we discussed, if fair or not.

Payout is 90% and the agency or branch fee for office space, supplies, osj oversight, etc is 25% of your net - net being after LPL takes all their fees, etc...

Fair?

Jul 16, 2010 10:54 pm

25% seems high to me.  I guess it depends on how much you will be grossing.  25% is a big chunk of dough if you're doing 500K.  Is the agency providing anything more than OSJ, office space and supplies?  If not, those are some pricey Bic pens....

Jul 17, 2010 12:14 am

I am at 15%. I think that number is very fair. What do you get for 25%?

Jul 17, 2010 10:48 am

Glad I chimed in, because I thought 20% OSJ/Branch space was high.... Now it seems that IS HIGH!

Jul 17, 2010 12:12 pm

[quote=clemente]

25% seems high to me.  I guess it depends on how much you will be grossing.  25% is a big chunk of dough if you're doing 500K.  Is the agency providing anything more than OSJ, office space and supplies?  If not, those are some pricey Bic pens....

[/quote]

I agree.

Jul 17, 2010 10:51 pm

Thanks - he explained that 10% is the customary OSJ fee and the extra 15% is for everything else, office space, marketing,  secretarial clerical staff, conference rooms, supplies, etc... basically all overhead.  And the 25% is AFTER all other LPL fees would be taken out.

Jul 19, 2010 1:49 pm

[quote=iceco1d]

Gettingstarted, I think you're confused about how the fees are taken out.  It's 25% of your gross, not your net. 

[/quote]

No I'm not.  At the end of the month - advisors are to add up all they have "netted" from LPL, insurance, etc, THEN take that and multiply by .25 and cut a check. 

Jul 19, 2010 3:00 pm

So, you do $20K in a month.  LPL pays you out at 90% (on your first 250K).  That leaves 18K.  Then, LPL takes out fees, E&O, technology, etc.  Let's just say another 1K in fees.  17K left over, of which you owe 25% to this agency you are talking to.  So, you'd net 12.75K, for a net payout of 63.75%.  Do I have that right?

There are certianly less expensive OSJ arrangements out there, the question is whether or not the "marketing support" is worth the extra $$ you will be paying.  A good marketing partner is worth its weight in gold.

Have you looked at any other indys?