Indies: Join a company or make ur own?
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Lets list out the pros and cons. Or just your thought on it.
Pros of joing an indy company:
Everything is ready to go.
Cheaper since sharing the company.
Cons of joing an indy company:
Not the way YOU want it.
Doesnt have your name on the company.
Pros of making your own company:
Your in power and run the business how you want it
Cons of making your own company:
Stress of starting your own company
Spending money for everything that is needed.
you can talk about your decision on either or. Why you decided to join a independent company rather to start one up yourself
[quote=brothaK]
Lets list out the pros and cons. Or just your thought on it.
Pros of joing an indy company:
Everything is ready to go.
Cheaper since sharing the company.
Cons of joing an indy company:
Not the way YOU want it.
Doesnt have your name on the company.
Pros of making your own company:
Your in power and run the business how you want it
Cons of making your own company:
Stress of starting your own company
Spending money for everything that is needed.
[/quote]
I think you are a bit confused on what it is to be an independent registered representative affiliated with a indy broker dealer.
I am affilated with a nationally recognized name indy b/d. You can brand name your own company. I have my own DBA on my letterhead and the sign on my building. You do have to also have the b/d name as well, but it can take second billing if you want.
Pros of an indy firm....
lower production levels required they take care of compliance and registration issues they have done due diligence on the products you have a selling agreement with (mutual funds and VA companies) you can be an independent office or work in an office with others to combine production no proprietary products other than standard regulatory oversight to make sure you aren't using discresion if not authorized,hurning, switching, twisting etc. very little feedback from the home office on your production. fixed income and insurance is not under their supervision (yet) higher payouts and you are 1099 not W-2 they provide you with a platform to do trades and generate reports they give you lowered cost subscriptions to research sources all of your business expenses are bottom line deductible expenses. You can control you own taxes. no one cares how many hours you work or even how much you make. If you don't make a certain level of income for them, then of course they will cut you lose. When you retire you may be able to sell your book of business. You are building equity in your own company.Cons
in exchange for the higher payout you are responsible for all of your business operating costs there are affiliation fees, E&O insurance and optional charges for other services the company will provide for you. ticket charges can negatively impact your bottom line you need to be able to concentrate on running your business as an actual businessman would, keeping an eye on expenses/income and profit/loss. If you have employees you are responsible for all that FICA and other stuff. your marketing plan is on you. No one tells you what when and how to market your business but you do have to submit any marketing to advertising review first. no one is going to kick you in the butt to make you produce more burden on you to keep books and records up to date and other office related compliance issues Depending on the Indy firm, you probably won't have a group insurance or other health insurance option available or a retirement plan, so it is all up to you.I'm sure that others can think of more pros and cons.
Brotha,
If I remember correctly, you are new to the industry. Most indy positions will not be available to you until you have some industry experience (five years or so) and proven production. The closest you'll likely get to a truly independent (i.e., running your own business) office is to either work FOR an independent advisor, or work semi-independent as an Edward Jones broker. I'm not aware of any firms (although they could exist I suppose) that would cut you loose without on-site supervision, except Jones. I think Babs is right and you are misunderstanding what we're talking about when we refer to independents.
indyone,
I am new yes, but I'm trying to plan my future out and get as much opinions and experience as possible.
In my initial post what I was trying to say was:
To all the independents who made the transition, did all of you go and create your own office, or go into an already premade office which has like 4-10 FA's already there.
ie: indyone had an office of his own, then looney was like let me go independent and was too lazy to make her own company, so she told indyone, "hey let me come and join ur company and we will split the utility bill, secretary or wtvr"
Gee thanks for making me the lazy one.
Actually it depends on your estimated level of production and ability to "play well with others" on whether you would want to go independent alone or team up with other reps to share the production requirements. There is a lot to be said about sharing office expenses. But sometimes the team is still in separate offices or locations. There is no hard and fast rule.
If you think you will be able to take your clients with you when you go indy and also continue to grow your book AND make a living after expenses, then you may want to be completely separate. If not there is nothing wrong with teaming up with others as long as all the ground rules and financial issues (succession, selling the book etc) are hammered out.
In any case to go directly from starting in this industry to independent would be very difficult. Most people work as Indyone said, before going out on their own. I had already had about 12 years in the industry before making my move. Probably the same for others I would hazard to guess.
u know i luv you looney, I was just trying to make an example.
I'm sure your ego is top notch, so I didnt worry too much.
I see what you're saying brothaK. If you plan on being an Indy advisor eventually it makes sense, during your due diligence process, to call some local Offices of B/D's your int'd in and talk to the OSJ. Find out if they're looking to expand, what they provide to advisors working under them and what type of exit strategy the allow.
Early in your career it can make it much easier if they have some kind of a training program rather than trying to figure it out on your own, but that's up to you...