pros: a $50MM office is a heck of a good start in the Jones system. you will pretty much skip the whole door knocking thing. you have an instant customer base (they aren’t your clients till they trust and value you).   even under the Jones transactional model it is probably producing @ $5-7K/month in trails. The benefits are obvious. and one of the greatest things is that you’ll blow right through the segments and within months be on your own firm broadcast explaining how doorknocking helped you go from new hire to segment 4 in only 12 months.   



Cons: if the office really was as advertised why has it been empty for “the past few months”? either some local struggling new FA would have taken it, existing FA’s brother would have taken it, or someone in the PASS (home office types who are waiting for a juicy opportunity) would have jumped all over it.



summary: sounds great, could be a great opportunity, but i’d want proof about the branch first.

I have a hard time believing that you have been recruited over the past few months to take over a $50M office.  At Jones, $50M offices are usually up for grabs for about 24 hours (if that).  They usually don't just sit open.

And, if the rep moved to another firm, and there were $50M in assets when he left, I can almost guarantee you it is NOT $50M now. If it has been a few months, there is probably less than $25M if the rep was decent at all.

If you are going to go to Jones, taking over an existing office is the best way to go.

Don't make a long term career decision based upon short term income.   In this case the income probably isn't that great.  Since the clients have no relationship with you, you'll probably lose half the assets.  Because of the Jones business model, you probably are talking about GDC of .25% on $25,000,000.  This gives a GDC of $62,500 and a payout to you of $25,000. 

This $25,000 is not free money.  You have to spend time servicing these clients.  There ain't no such thing as a free lunch.

If EJ is the best firm for you go there.  Otherwise, don't.  The 50M should not be a deciding factor.

OK, perhaps I misspoke about the exact details.  When Jones first contacted me, it was more along the lines of general recruitment.  I was transferring some assets away from them and the local rep who was losing the assets contacted me.  Several of the calls came from the home office and one woman mentioned a “unique opportunity” that would be coming up in the near future.  Sunday I received a voicemail from the local rep telling me that the office was available because the existing rep was moving out of the area.  Yesterday I received a voicemail from the home office and was told this opportunity was “first come, first served”

[quote=CareerChanger]OK, perhaps I misspoke about the exact details.  When Jones first contacted me, it was more along the lines of general recruitment.  I was transferring some assets away from them and the local rep who was losing the assets contacted me.  Several of the calls came from the home office and one woman mentioned a "unique opportunity" that would be coming up in the near future.  Sunday I received a voicemail from the local rep telling me that the office was available because the existing rep was moving out of the area.  Yesterday I received a voicemail from the home office and was told this opportunity was "first come, first served"


[/quote]

Yeah.......that's the ticket!

if its 50m, non-competitive you should probably grab it.

I just got off the phone with the Jones recruiter and the reality is that it is a 20-30 million office.  The rest of the assets have been taken over by other advisors in the area.  Of course the recruiter made the opportunity sound like the greatest thing since sliced bread, but having read numerous posts here about Jones, I’m a little leery.

Assuming the current broker is leaving the area but still staying with Ed Jones you should be able to talk to that broker to find out about the assets.  Shurely the broker will take some assets with them, how much? 

Then I would get it in writing that you will be taking the office and that Ed Jones won't split any of the assets off to other local brokers other than at the customer's request (most likely the other brokers in the area are all clammering to get a share).

Those are two issues I would be interested in.  Also, ask yourself how are you currently doing where you are at?  You are one year into an occupation that 85% of the people don't last three years.  $50M will come as close to guaranteeing that you will be able to make a living in this occupation as you can get, but comes with strings.    

[quote=CareerChanger]I just got off the phone with the Jones recruiter and the reality is that it is a 20-30 million office.  The rest of the assets have been taken over by other advisors in the area.  Of course the recruiter made the opportunity sound like the greatest thing since sliced bread, but having read numerous posts here about Jones, I'm a little leery.

[/quote]

If the vultures have depleted half the book in three days I would be very cautious.  Of course this still depends on your current situation. 

$30 million in old dead A shares is $75,000 a year.  At what payout? 40%?  and what about when the SEC eliminates 12-b-1 fees?  oops EDJ will be out in the cold.

[quote=vbrainy]$30 million in old dead A shares is $75,000 a
year.  At what payout? 40%?  and what about when the SEC
eliminates 12-b-1 fees?  oops EDJ will be out in the cold.[/quote]



To say nothing if the SEC decides to keep 12b-1 fee’s but eliminate revenue sharing.

See, this is how they lie to people. First they told you $50 million. That was

a lie. Now it’s $20 million. I’d get the previous brokers name and see if he

still works for Jones. Go to their website and plug his name in. I bet he

doesn’t.

Would you be interested if the call was about a 20 million office? If your successful where your at…why move for 20.  50, different story, but 20…not a chance.  Go ahead and work hard and continue moving assets away from Jones…especially with an open office…

[quote=vbrainy]$30 million in old dead A shares is $75,000 a year.  At what payout? 40%?  and what about when the SEC eliminates 12-b-1 fees?  oops EDJ will be out in the cold.[/quote]

$30mm in A shares is $2.25 gross in a VA. That's 30 years worth of 12b-1's in one day!

Do your research quickly and in depth.

Based on what little info we've got my guess would be that if you are currently hitting all of your numbers and on track to be successful it is probably not worth the headache. 

However if you are a marginal broker, (as many are) 20-30 million (if legit) is a large book from which to start and COULD make the difference between failure and success for some advisors. 

If you are going to do this, you need to do is quick, those assets won't stay forever. 

In my experience, EDJ was pretty good about keeping other brokers from poaching the office (after they were given whatever they were going to give). 

I would ask about the makeup of the book.  There could be A LOT of long term bonds in that portfolio.  I did something similar and had a $1MM client who I basically serviced for free, she had no interest in anything other than holding her tax free bonds.

Also, realize that if 1/2 of the book has been taken, it isn't the dead weight that they took, it will primarily be good accounts.

I echo what has been said before about only taking this if you feel you are marginal to make it in this biz.  EDJ is not the easiest place to make it.  You will no longer have nontraded REIT's, most annuities (other than A Share products from 4 companies) or wrap accounts.  That's a big hinderance to building a business in my opinion. 

On the other hand, if you are struggling, taking over a $20MM book can be pretty appealing. 

If you were taking accounts FROM Jones, why would you want to go TO Jones?

Look at it this way, you have probably been taking dead assets away from the EDJ office.  You have been uncovering the other assets those clients have (which the previous EDJ broker did not uncover).  Chances are Jones has been giving out the "active" accounts to the other offices for fear of losing the clients (hence the drop from $50mm down to "$20-30mm").  So most of what will be left are "inactive" accounts.  But that does not mean all bad things.  There are going to be a lot of good prospects in that list of $20mm.  I had a $5mm Goodknight, which were basically all crappy, inactive accounts.  I tell you, I worked those dogs and uncovered some gems.  Not enough to live on, but enough to help keep me going through the first year.  Unless you are REALLY ripping it up where you are, I would strongly consider it.  If you can't make it in this business with a $20mm headstart, you won't make it anywhere.  Just make sure the Jones model works for you first.

I tell you, I worked those dogs and uncovered some gems

There are always gems to be found in the dogs.  That doesn't make them worthwhile to pursue.  Would you have made more money if you went after other business with the time spent on the dogs?

It's tough to turn chicken sh*t into chicken salad.  I look at a lot of what we do like the old game show "Let's make a deal".  I'd rather go for the complete unknown of curtain #2 then trying trying to make money from the goat that I won with curtain #1.