GP....Big Deal

From what I know the returns are quite a bit higher than you would have done with MER, AGE or RJF. (even after the discounted price on the stock) The risk in my opinion is not much different than the risk of the stocks. Even the LP (bond in drag to some) has kept up with the above mentioned stocks if not beating them. I don’t think you understand the “partnership money being held up” very well.

I know guys who were supposed to get LP money last time, did’nt get it. they may have gotten it by now…i don’t know

The earnings are accumulating in a pool to be paid at end of year. Not a bad deal.

Exactly right not a bad deal. An annualized return of 21% (through July)  w/no out of pocket $. As soon as the SEC makes up their mind about 12b-1’s and revenue sharing (which will affect many brokerages other than Jones) the LP offering will proceed.

give me an example of how much this is, per year or whatever…For a edj rep million dollar producer. Not THE Biggest producer in the company. But a Rep doing around 1 million a year, 20 year vet, what would his GP look like?

So, let me see if I understand you a bit. In your first post above you say that the GP is not a good deal and now you admit you know nothing about it! Typical of this board. Big difference between LP and GP. I have no GP so I can’t comment anymore that I already have. I am close to a million, not a 20 year vet and my annual income from LP runs about 40k-50k

Guest1,

Don't be so paranoid. when I was at Jones, I remember stories of GP's that seemed like a lot of money, but I was new in the business (so everything seemed like a lot) I don't recall what guys were getting who were bigger producers. I have a friend who is still at Jones who is constantly obsessing and bragging about GP money. I know at ML we have half a dozen guys here in my branch who get 300k - 500k per year in Merrill stock. (these are guys with LOS 20 or more, that obviously do 1.5 +)I was simply wondering if this is a similar gig to GP. I am not trying to be condescending. 

Guest1,

200k of LP generates 40-50k a year....same amount in your favorite "preferred" G+I fund is going to COMPOUND at around 9-10%.  Therefore the "bonus payout" you are receiving on your INVESTMENT (note, not given to you) is about $20-30k/yr....unless you are dreaming about going to STL and getting the brass ring the rest of us pay for, why do you stay?  It looks to me like the addtl 200k you are leaving on the table could pay for some nice trips...I will freely admit that I am frustrated right now....I am standing on the ledge--talk me down.

Ex, I hav only paid for 25% of the LP, the rest financed itself. It is not my role to “talk you down” I trust you can fiqure it out for yourself

That's called leverage...you paid for it by forgoing the earnings...try again.  The fact is the excess return is 10-15% per year...Indy's at your prod net $200k/ yr more than we do...no fuzzy math there.

Thanks, bro, for the push....

See ya…

[quote=ExNIRSS]

That's called leverage...you paid for it by forgoing the earnings...try again.  The fact is the excess return is 10-15% per year...Indy's at your prod net $200k/ yr more than we do...no fuzzy math there.

Thanks, bro, for the push....

[/quote]

lol.....welcome aboard!  The water's fine man....jump in!

I am standing on the ledge--talk me down.

[/quote]

Come on ExNIRSS! Where are you coming up with that kind math...you must be an ex-CPA or something!

[quote=Guest1]So, let me see if I understand you a bit. In your first post above you say that the GP is not a good deal and now you admit you know nothing about it! Typical of this board. Big difference between LP and GP. I have no GP so I can't comment anymore that I already have. I am close to a million, not a 20 year vet and my annual income from LP runs about 40k-50k[/quote]

If you're producing a mil and getting 40% or even 50%, you're still screwed next to the Indy getting 80% (after ticket charges) or more.  The $50K doesn't begin to make up the difference...not even considering the cost of overhead.

Besides, can you really put a price on your freedom?!!

Hey, frustrated!

I realize advanced math for you means anything where you have to take off your shoes, so I'll keep it simple....

Indy >>>> Revenue less expenses = take home pay

EDJ >>>>> Revenue less direct expenses (of which you are) = GP take home pay

Please don't throw me in the briar patch...

If your doing a million at wire, you are also getting some good size stock bonuses. I’ts a huge benefit over lifelong career. The Indy guys I know, after figuring their offices, payroll, and all expenses say they are closer to 60%.

If your Indy friends produce a mil and are only at 60%, they have some real cost control issues...

[quote=Indyone]

If your Indy friends produce a mil and are only at 60%, they have some real cost control issues...

[/quote]

And yet, even if they are at 60% with serious cost control issues, isn't that a little better than being at a wirehouse?

As a business owner in another industry, I get the Indy mindset. My own experience, with ML for the past couple of years has been great. (The business in general frustrates the hell out of me - but that has nothing to do with where I am). I was at ED Jones (where I have to believe the day to day life is similar to Indy) for 18 months, I thought I was going to jump out a window. It's like being in solitary confinement. Now if I had a book of a ton of clients that kept me busy, maybe I would have enjoyed the independence more. But, prospecting, having no business, in a brand new industry to me, it was not a productive atmosphere.

At ML, in my particular office, we have 60 Advisors, a lot with LOS 20 or more, a great director, strong market share in the community, a beautiful office. It's really a positive environment. I am surrounded by strong examples of where I want my business to be. Of 60 advisors -20 make 400k , another 20 or so are probably at 250k + 10 are above 500k the rest are somewhere 80k - 175k. I don't know how it works at INdy land, but there is quite a bit of succession planning within the brokers here.

You are at a very strong ML office! The one in my area looks nothing like that. Indy or Jones you must be a self-starter that does not need the motivation of others in your office to get you fired up and making the calls. I agree, it is sometimes the hardest part of this business.

Guest1, there’s one broker in a Jones office, and there may be just one broker in an indie’s office.  That is where any similarity between Jones and independents ends.  Clearly for you Jones is the greatest thing since sliced bread (and I’m happy for you), but to an entrepeneur, Jones is pure liquid hell.  So please don’t try to pass off the “being at Jones is just like being indy with great back office support” pablum…it’s simply not true.   

Starka, easy big guy! Don’t think I insinuated that at all. I don’t think ANYPLACE is the greatest since sliced bread. Every shop can improve and as an entrepeneur I have the control to do that for myself, my staff and my family. Please remove the chip from your shoulder as it is making a funny wrinkle in your coat.

No chip there, Guest1.  Simply correcting an error in your statement!

Which error would that have been?

You disagree that INDY and JONES are alike in the manner that you are in a office by yourself without the "water cooler" motivation to get you fired up? Because that is the only comparison to INDY and Jones I made.

I have to agree with guest1. He really did not draw any other conclusions, other than the physical nature of an ED jones office being like an Indy office. I think you went a little overboard STarka.

You’re certainly entitled to think that.

Starka, you mis-read my post. That is ok. Moneyadvisor, I am not use to anyone agreeing with me on this board. Don’t let it happen again! LOL

[quote=Starka]Guest1, there's one broker in a Jones office, and there may be just one broker in an indie's office.  That is where any similarity between Jones and independents ends.  Clearly for you Jones is the greatest thing since sliced bread (and I'm happy for you), but to an entrepeneur, Jones is pure liquid hell.  So please don't try to pass off the "being at Jones is just like being indy with great back office support" pablum....it's simply not true.    [/quote]

As usual Guest1 can't see the forrest through the trees, because he thinks he will be a LP one day or maybe a GP 

Starka you nailed it............

Moneyadvisor,

I am about to give you the best piece of advice you will get today.  If your ML office is as you say it is, you should stay.  Work hard, be in early (even if your just checking Fox News at 7:00 am) and leave late.  Try to do as much work IN THE OFFICE as possible.  WHY?  Because at ML, perception is EVERYTHING.  You need to look good and be around often.  Obviously you need to bring in some accounts to stay, but if you can just hang on long enough and get into some kind of formal partnership, you will be set for life.  Trust me, I've seen it.  I was at a mediocre ML office (market penetration 31%, WAY below average), so the opportunity wasn't there for me, but the main office in our complex...unbelieveable.  It might even be the office you are talking about, because it was just as you say. 

Many advisors at ML built their book on the "sit and swivel" method.  IF only they'd get rid of that darn FAC!  Talk about cutting your trainee's throats!

BTW, not that anyone cares, but I'm proposing on 3.2 million cash proceeds from real estate sale today!  Gotta love those c0mmercial lenders.  Wish me luck.

BankFC -

You NAILED it! That is exactly the atmosphere. It's the lottery system. Encouraging, yet frustrating at the same time.

Here are some interesting facts for all you Jones lovers and haters out there:

Recently the Saint Louis Business Journal ran an article on the highest paid execs in Saint Louis.  Jones had 5 of the top 10.  Not bad, but here is the kicker.  They only have to report their top 5 on their K1 report.  No other company in Saint Louis has anywhere near that many execs at the top of the pay scale.  WHAT WOULD IT HAVE LOOKED LIKE IF THEY HAD SHOWN THE 10 OR 20 TOP PAID GUYS AT JONES?

When all of you Jones brokers look at how much you are paying for heath care, office expenses, and the horrible retirement plan how does it make you feel that your hard earned money is making the rich get richer.  Also what about your clients having to pay for TOD fees. 

This is why you have not seen a big technology roll out at Jones, this is why you have not seen new departments created to look at more fee based planning.  It is because these things cost money and these top execs are not willing to take a pay cut to provide these services or benefits for the clients and their employees. 

Listen you Jones supporters can all take up for the firm, but how do you explain the FACT that unlike any other company in Saint Louis they have this many top paid execs when only the top 5 had to be listed.  AG Edwards CEO, which is also based in Saint Louis was ranked 38 and Stiefel Nicalaus was ranked somewhere close too.

If someone has an explanation other then that Jones is ran by a bunch of greedy executives who put on a good face for their IRs and their clients please let me know.  Would doing whats best for the clients and employees mean bringing your pay scale down to a more appropriate level where you still make a good living and share the riches to help reduce fees for the clients and increase the take home pay and benefits for the employees?

Even if you are a Jones supporter through and through you need to put these things in perspective.

GP...It is a BIG DEAL

An expensive deal that all the employees and customers are paying for.

I have always thought that the GP deal was a no brainer for the chosen few.  And it is a great carrot to keep the deluded clones repeating the company line(s), and paying the bills.

Here's a thought.  The GP's dont want fee based programs because then they would have to split the recurring revenue with the IR's.  With revenue sharing, they get to keep nearly all of it.  The only downside is that in order to make the deals sweet enough for the fund companies to pay the big kick backs, the selection of products has to be narrow to focus more dollars to fewer funds.

It  is obvious that the Jones line of, " these are the fund companies that pass our due diligence tests" is a bunch of crap.  The real reason behind the "preferred" funds is to leverage their relationships and maximize revenue sharing.  Otherwise a couple of fund families would have been fired 3 years ago... as they should have been.

But, the thing that gets me the most is the health ins.  Nearly every other large firm helps FA's with the cost of health ins, except Jones.  The only upside to that is that I bought it cheaper for me and my family privately when I was at Jones because I could get it better and cheaper on my own.  And that was one less thing I had to worry about when I went independant earlier this year.

Between health ins and 1350/mo for "technology and communications," no wonder Rich Malone makes so much money.

GP, to IR, bend over this is good for you and your client....my "5" mil is not enough for my family needs!  Gee,  maybe we need to reduce payouts again 

You've been bending over so long you don't know what way is up and out the door................but you keep taking it, must be you like it..................