I don’t think there is any other career that can beat this, that is if the FA can handle the initial weeding out process.

I agree with many of the posts on here. I started mid 20s. Now early 30s. I would not do again at that point in my life. Too many lumps taken and too many years invested to quit now. It is to the point I earn (by my standards) a decent living. I bet I am 5-7 years away from making 150-200k everyone talks about. If I had taken the a different career track in my other field of study, I would have made about the same by then and more money along the way. I just hope the 20 after that make it all worth it. Don’t disregard what NASDNewbie writes about. Many of his posts seem pretty grounded compared to the true Newbs that critque his comments.

peanutbroker, it's time for you to switch careers.   You've worked 5-7 years and you're still 5-7 years form making 150K?  This is the wrong career for you unless you jump out of bed everyday excited for the day. 

Switch careers to something that you enjoy doing.  You'll be much happier and you'll make more money.  The skills that you have acquired will be very helpful in whatever comes next.

It sounds like your income is around what a 1st year rep in my firm makes.

[quote=anonymous]

peanutbroker, it's time for you to switch careers.   You've worked 5-7 years and you're still 5-7 years form making 150K?  This is the wrong career for you unless you jump out of bed everyday excited for the day. 

Switch careers to something that you enjoy doing.  You'll be much happier and you'll make more money.  The skills that you have acquired will be very helpful in whatever comes next.

It sounds like your income is around what a 1st year rep in my firm makes.

[/quote]

And what type of firm are you with?  How long had you been out when you first entered $150,000 on a tax return?

Our typical first year guy makes about $75,000.  I'm guessing that this is around where he is since he sounds to be around 7 years in and is still 7 years from $150,000.

On occassion, someone will make 6 figures in their first year, but not too often.   $150,000 is typically attained in year 3 or 4. 

I would assume that you were at this level in your 2nd year since you made your firm's president's club. 

I'm with a major insurance company and their B/D.  It seems to just be a much easier way to make a decent income in the early years and very large incomes when one becomes experienced.

Agreed anon it is easier to make big money with insurance. But at the end you dont really HAVE those clients. It’s more or less a one shot deal.  Why waste all that effort so that when you become an FA not too many of your ins clients would come to you (the ex-insurance sales man).

brothak, if you think that it's a one shot deal, you don't understand the business.  What makes you think that someone who works for an insurance company is not a FA?  Even if someone started just selling insurance, why would they ever become an ex-insurance man?  After all, is a FA who does not handle insurance as a significant part of their practice, a very good FA?

If I made a switch to ML or someplace similar, my payout on investments would be about half of what I currently make and my payout on insurance would be about 25%.

The reality is that the investing public does not think much of insurance sales people--most folks would rather go to the dentist than have an insurance salesman in their living room.

People who end up at a place in their life where they have meaningful investable assets came out of college and became aware of the caste system that is present in the financial services industry--consequently they know that the chances of getting good investment advice from their insurance salesman are almost non existant.

That said I do agree that those higher up the totem pole don't pay enough attention to insurance.  I am a good example--like all rookies I got my Life and Health license and I dutifully renewed  it.  I also only thought of insurance if the client happened to ask if I knew somebody who could sell him a life insurance policy.

I fancied myself as being better than the insurance agents--I was, but that's no reason to leave money lying on the table.

"The reality is that the investing public does not think much of insurance sales people" 

I wouldn't argue against that point.  However, if I do business as "Anonymous Wealth Management" and my B/D is owned by an insurance company and someone else does business as "Smith Wealth Management" and their B/D is owned by LPL, the investor doesn't know the difference, nor do they care.  They just know that I'm their financial advisor and their friend, colleague, boss, etc., referred me to them.

"I fancied myself as being better than the insurance agents"

I don't blame you for not selling insurance.  The wirehouse environment makes it unprofitable for reps to sell protection.

I'm willing to give you the benefit of the doubt that you weremore successful, dressed better, more knowledgeable, smarter, harder working, more ethical, gave better service etc, etc. than the insurance agents.   However, the one thing that you were not is "better".  They protected your clients and you did not.

I don't want to get into a pissing contest about insurance.  My point of view is that it is something that we all know we need, and we all are easy targets when the time is right.

I believe that insurance agents are order takers as much as salesmen--the client is very receptive so all the salesman has to do is not piss them off somehow.

That is not the case with investments.  If for no other reason that the Financial Planning 101 teaches that getting your insurance in place is the first step.

How many young college graduates have been told, "Well, you could always sell insurance......"

"I believe that insurance agents are order takers as much as salesmen"

This is very true for property and casualty, but not true at all for life and DI.

The top insurance guys sell tons of whole life insurance.  Nobody "orders" whole life insurance.

[quote=anonymous]

Nobody "orders" whole life insurance.

[/quote]

And nobody should buy it--the insurance industry is not where you should turn with your investment dollars.

As A.L. Williams would say, "Buy term and invest the rest."

NASD, who mentioned anything about buying whole life with investment dollars?  A quote like this shows that you have very little knowledge on the subject. 

[quote=anonymous]

NASD, who mentioned anything about buying whole life with investment dollars?  A quote like this shows that you have very little knowledge on the subject. 

[/quote]

gassspp............

you dare question the wisdom of a fella' who dresses up his dog while on vacation, who also smuggles it into restaurants and unto airplanes, and also works part time for free in an ice cream parlor (while wearing his "brokers suit") without a health card?

what's wrong with you?
do you not recognize genius?

anonymous…I have been in the business less than four years. Maybe I should have been a a little less dramatic. Income for this year will be somewhere around 65 - 75k. I am sure it is much easier to make the bigger money dropping everyone’s money into 7.5% payout bonus annuities and 10% payout EIAs. I do bunches of CDs and bonds that pay less than 1.5%. Plenty of funds and stocks as well that pay a bit better of course too. I don’t do many VAs or EIAs, don’t find much use for them. Although have liquidated plenty of them as many of those insurance guys put those things into IRAs with the only justification for the extra cost is the death benefit. I imagine my production would be lots hirer if I got a 7-10% payout on every client, but I figure that eventually my clients will get wind of what is going on and my business will suffer in the long term. Some other advisor may review their account and say, “Why are you paying 3% annually for that investment when you could be paying only 1%. The only thing that you get for those extra insurance charges is that death benefit. Are you sure that it is worth the extra $6000 you are paying the insurance company every year to own that mutual fund through the insurance company? Why don’t we cut out the middle guy and go straight to the fund company and save you a lot of money.” I don’t want to lose accounts because I was greedy up front. $500k into A share funds = $8k gross. $500k into VA = $37.5K gross. It is not hard to understand why people at your insurance firm make so much so early.



The point of my first post was that it is harder to start in your twenties, although it can be done. I really like what I do, don’t want to change. It is just difficult starting from scratch with nothing but a company’s name behind you and a fairly good trainig program. I would not do again, if had to start mid twenties. I would wait a few years.

peanutbroker, my firm doesn't use bonus annuities nor do we use EIAs.  Our insurance income comes mainly from life, DI, and LTC insurance.  Less than 10% comes from traditional fixed annuities and  variable annuities.   The ones that we usually use only pay 3%. 

".. as many of those insurance guys put those things into IRAs with the only justification for the extra cost is the death benefit."

From this quote, it is safe to assume that you don't understand the living benefits of variable annuities.

Do the living benefits come at the expense of total return?

[quote=NASD Newbie]Do the living benefits come at the expense of total return?[/quote]

Absolutely. Just like your home and auto insurance comes at the expense of your total return on your human capital. You didn't know that?

[quote=peanutbroker]anonymous...I have been in the business less than four years. Maybe I should have been a a little less dramatic. Income for this year will be somewhere around 65 - 75k. I am sure it is much easier to make the bigger money dropping everyone's money into 7.5% payout bonus annuities and 10% payout EIAs. I do bunches of CDs and bonds that pay less than 1.5%. Plenty of funds and stocks as well that pay a bit better of course too. I don't do many VAs or EIAs, don't find much use for them. Although have liquidated plenty of them as many of those insurance guys put those things into IRAs with the only justification for the extra cost is the death benefit. I imagine my production would be lots hirer if I got a 7-10% payout on every client, but I figure that eventually my clients will get wind of what is going on and my business will suffer in the long term. Some other advisor may review their account and say, "Why are you paying 3% annually for that investment when you could be paying only 1%. The only thing that you get for those extra insurance charges is that death benefit. Are you sure that it is worth the extra $6000 you are paying the insurance company every year to own that mutual fund through the insurance company? Why don't we cut out the middle guy and go straight to the fund company and save you a lot of money." I don't want to lose accounts because I was greedy up front. $500k into A share funds = $8k gross. $500k into VA = $37.5K gross. It is not hard to understand why people at your insurance firm make so much so early.

The point of my first post was that it is harder to start in your twenties, although it can be done. I really like what I do, don't want to change. It is just difficult starting from scratch with nothing but a company's name behind you and a fairly good trainig program. I would not do again, if had to start mid twenties. I would wait a few years. [/quote]

Young man, "payout" is what the firm pays you. "Commission" is what the product pays. I sell VA's. The commission is 7.5% and my payout is 90%. For every million dollars in premium, the commission is $75,000 and I get paid $67,500.

Since you THINK you are in the same business as everyone else, you should study the vernacular.

[quote=knucklehead]

[quote=NASD Newbie]Do the living benefits come at the expense of total return?[/quote]

Absolutely. Just like your home and auto insurance comes at the expense of your total return on your human capital. You didn't know that?

[/quote]

The point is that when a financial advisor grasps for security instead of total return they are short changing their customers.

Most people are anticipating a far greater overall return than you're generating--they are slowly becoming disappointed and will eventually become angry.