First 10-20

Most would be family and close friends.

And your own account of course.

I got some of mine through referrals, walk-ins, and just asking people to do small business with me.

I don’t recommend starting with family & friends.  If something goes wrong with those accts, it makes for tense family gatherings, etc.

jas1032

Advertise in the local paper.  Run a couple of seminars.  Work the phones. Join every club in your area.  I would hesitate to learn on your family.  Not a good situation when things go wrong.

Don’t listen to exEJIR.  Go for your family and friends.  If you don’t have confidence and can’t ask for help when  you need it, don’t take ANYONE’s money.  I have asked all family and friends.  Just take it slow and do what is right.  For these accounts, just ask yourself if you would do the same thing with your own money.

Just curious Kargon, how long have you been in the business?

jas1032

Confidence is great and if that all it took to be a good financial advisor everyone would be successful!  Most people understand that with experience comes knowledge.  There isnt a book you can read to give you the knowledge you will obtain after doing this for several years.  All im trying to point out is that you do not want to piss off family members because you made a rookie mistake.  After a few years your family will see that your doing fine and they will want to deal with you. 

jas1032

Until you've been in this biz a few years, I wouldn't take on family and friends.  Lots of chances for mistakes due to lack of experience. 

I know it is a long cycle, but if you could wait until you have seen a complete market cycle, you'll understand what I mean.  Time in this biz is the key.

[quote=exEJIR]Just curious Kargon, how long have you been in the business?[/quote]

This biz, almost a year, so not long.  I have been sales prior for 10 years.  I have accounts with all of my friends and family.  Why wouldn't they trust me over a stranger?  I know them better than anyone else in the biz and I talk to them more than their current or some other advisor.  Plus, I am confident in what I recommend to my clients.  I am upfront about everything, including that my firm may be more expensive than their online account, but I tell them what they get for their money.  Does that online brokerage firm call you when there's a problem or when a stock is upgraded?  Well, I do.

If you are nervous about going after friends and family, at least get an account open and have them transfer a small portion of their assets so you can show them what you can do for them.

If you don't have confidence with friends and family, then how can you be confident with strangers.

Believe me, I don't have a problem with confidence.  But, typically what you do have is an unrealistic expectation that they are your best clients simply because they are friends/family.

If it's working for you that's great.  I just wouldn't recommend it to everyone.  Just like you wouldn't recommend every investment to EVERYONE.

P.S.  Don’t confuse confidence with arrogance.

I was just wondering if you were going to place an ad in the paper, what does yours usually say? How many responses on average do you get in return?

I started out doing tax work for a few years first.  When I reached a decent level of tax work I started to bring the investment options.  I now have over 400 tax clients I am working with and they all trust me with their other investments.  It was easy to get them to sign a change of broker form for most of their investments to get a good base started.

It might be something to look at (My BD caters to reps that do tax work), that way their was no problem with other business.

[quote=exEJIR]

Believe me, I don't have a problem with confidence.  But, typically what you do have is an unrealistic expectation that they are your best clients simply because they are friends/family.

If it's working for you that's great.  I just wouldn't recommend it to everyone.  Just like you wouldn't recommend every investment to EVERYONE.

[/quote]

My friends/family are in no way my best clients, I would just say that I talk to them the most.  My best clients are actually those who have been referred to me so far.

And, no, I don't recommend the same investment to everyone.

I typically try to dissuade family and friends from doing business with me. I have a few but typically their expectations are unrealistic and they are more difficult to get them to listen. A prophet has no regard in his own country…

I would be a great candidate to handle everyone’s friend and family that they are not up to advising. Of course a commision split would be worked out …

noggin: I typically try to dissuade family and friends from doing business with me. I have a few but typically their expectations are unrealistic and they are more difficult to get them to listen. A prophet has no regard in his own country...

----------------------------------------

Amen, noggin. Amen. 

I knew a couple of guys who really stuck it to thier families. 

1. was a bet-the-ranch recommendation on CBS Sportsline during the dot-com bubble

2. other shafted his father in law in Russian G-bonds when they collapsed in the hedge fund meltdown

#1 is now divorced and is selling Lexus.

Don't kid yourself, family money can be hard to get.  A guy in my office has been in the business for 2 years and hasn't been able to get his family's money yet.

I know several others who brough over all of their family members and then they didn't make it in the business.

I didn't actively solicit family accounts until my 4th year in the business, when I knew I was going to make it.  I didn't want to anger my in-laws.  Now if the family comes to you, that's fair game.

[quote=skeedaddy2]

I knew a couple of guys who really stuck it to thier families. 

1. was a bet-the-ranch recommendation on CBS Sportsline during the dot-com bubble

2. other shafted his father in law in Russian G-bonds when they collapsed in the hedge fund meltdown

#1 is now divorced and is selling Lexus.

[/quote]

I know a guy (no longer in the business) whose parents joined a lawsuit against him for unsuitable option trades. He tried to put the best face on it, saying he was following firm advice, but the panel said the qadvice wasn't so much the problem as the unsuitable clients he did it with. Result, the firm settled, went back at him for part of the money and ran him out of the business 

Regarding family and friends,

For some of us younger reps, it can be hard.  We lack the experience and long-term credentials that people who've been in the business for a number of years have.  While they may trust us, but they know we may have next to nothing experience in managing people's money. 

...just my opinion, not that I haven't tried to solicit my family/friends.

I wouldn’t go after family and friends at first in building the business.  Cold call face to face is how I did it.  It’s tough but wait to bring them on board.  They will come over in time.

[quote=SonnyClips]I've been reading this for a while. Some good advice about not doing business with families how about some on how to get business with strangers. I've been courting a number of civic positions, volunteer stuff, just to build my profile. I know it couldn't hurt but what have y'all experienced as far as real business from this kind of stuff. Everything I have volunteered for is stuff I like so that isn't a big deal.

Best,
Sonny[/quote]

Exactly the way it's suppose to be done. Make yourself the resident expert in these groups and let the business come to you. It's a slow build, but you will get business from it. Keep to groups, and causes that you believe in. This way, if nothing else, you are doing good or having fun. Maybe both!

[quote=SonnyClips]Always good to get some positive reinforcement. Hey thanks for the cold call script too, in the prospecting 101 thread. Are your cold call lists general zip code phone book derived or does your firm provide rookies lists bought from third parties, ie like all the people in the 90210 zip who have bought Camrys or Volvos?

Best,
Sonny [/quote]

The firm has supplied lists screened by age, location, income and net worth. These lists aren't any better than self generated lists of calling A neighborhoods from the reverse directory. I haven't bought a list for myself in a couple years. The last one was from CIS in New York. They do a good job. Since the DNC rules have come into effect they supply DNC screened names. Still, if you use them, I'd screen the names again. Our phone system does this for us, so we're covered.

Industrial directories are also good sources of names.

Another thing to do is to go down to your local government store. Pick up the cenus tract income info. Cross reference against a reverse directory, what you are looking for are A streets in B and C neighborhoods. Preferably in older areas. These people aren't getting their fair share of attention from investment professionals. No Govt store, no problem. This weekend take a ride. Have a tape recorder or writing pad handy. Find nice neighborhoods in not so nice places. Public libraries have reverse directories if you don't have one or can't afford one. I spend a lot of time at the library.

While at the library another good refernce book is the Dorlands Medical Directory. It's a comprehensive list of doctors. Names,addresses, area's of specialty, school and year of graduation. Lots of info to figure out a plan of approach, if just calling them doesn't suit you.