Thinking of going indy, any tips?

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racefan6320's picture
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Joined: 2010-06-03

I left Jones about 18 months ago, and now am in a bank.  Got hosed by the bank on comp recently and decided I'm tired of working for other people.  Currently looking at LPL and RJ.  Are there any other firms I should consider?  Any other tips anyone can give me who's made the jump recently?  Thanks!

jpw28's picture
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Joined: 2011-10-13

Depending on your product mix, you might want to look at several other bd's.  What products do you use?  Are you fee-based or commission?  Also, do you want to be close to your home office or does that not matter? 

Bully60's picture
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Joined: 2010-11-19

Good Lord, how are you going to survive as an independnet?  18 months at a bank is not enough time to endear yourself to the client base. Clients from a bank environment are much more "sticky" than any other channel of firms. You should have stayed at Jones until you had at least $25MM and then went independent. Go to another Regional firm, stay there for a good 3-4 years minimum, build a respectable book, THEN make the move. Unless you can afford the pay cut and have another source of income i.e. spouse, don't do it!

KingBobby's picture
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Joined: 2011-10-03

Bully60 wrote:Good Lord, how are you going to survive as an independnet?  18 months at a bank is not enough time to endear yourself to the client base. Clients from a bank environment are much more "sticky" than any other channel of firms. You should have stayed at Jones until you had at least $25MM and then went independent. Go to another Regional firm, stay there for a good 3-4 years minimum, build a respectable book, THEN make the move. Unless you can afford the pay cut and have another source of income i.e. spouse, don't do it! Why? You make more commission from DAY ONE. It's not rocket science to sell an investment product.

racefan6320's picture
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Joined: 2010-06-03

Wow, Bully is right!  I thought this thread was dead!  Then I got the email.  Wow buddy, thanks for the advice!  Went indy 1 1/2 months ago and the first full month out I made 7k gross.  Not great, right?  After haircut, expenses and assorted taxes I took home as much as a 22k month at the bank.  Add to that no meetings, no headaches from bosses, no conference calls, no branch-set CD renewal appointments, 1/10 the amount of driving, no compensation changes on a weekly basis, did I mention no meetings???Needless to say, I'm doing just fine running MY business MY way with MY clients.

feebasedrep's picture
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Joined: 2008-12-31

Congrats...looking at doing the same thing from a bank. What taxes did youneed to pay in the first month?

racefan6320's picture
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Joined: 2010-06-03

I'm organized as an S corp and have a VERY inexpensive accountant friend who pays me as a w-2 employee of the corporation so I don't have to mess with quarterly estimated taxes and so forth.  Works really well for me, and one less headache.

Element's picture
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Joined: 2011-12-28

Do you have an office? Assistant? Etc. - What is your set up?  Great to hear about your move.

STOCKJOCK's picture
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Joined: 2012-01-05

Why everyone who truly wants to run their own life,Build a business for themselves and their family Doesn't go independent is beyond me. With accessTo all the products through clearing firms like pershing and National financial services, you hAve the Redources to allow youtoDeal with clients the way you and the clientsAgree rather than being  pushed to offer the Junk the major firms foisted ontbe Public due to stupidity Snd greed.The difference between being a w-2  employe and getting z 1099 id night and dsy.Talk to prople who left wirehouses like me and adk if they Would go back.

racefan6320's picture
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Joined: 2010-06-03

Hey Element, Enjoyed reading through your blog.  I have an office, but no assistant.  Just me for the moment.  I'm hoping within 18 months I'll be in a position to hire someone.  I find it's a lot easier to do the work when I'm doing it for me!  I don't mind at all. 

KUIT's picture
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Joined: 2012-01-27

Racefan,congrats on the move, I am going to be leaving EDJ and was actually looking at a couple of bank positions. My long term goal is to go independent but don't feel like I have enough asstes nor do I have much in regards to personal reserves. What indy firm did you end up going with? I'd have to assume there is a lot of initial costs with the move as well, i.e. leases, technology, staff, taxes... Since you have just done it what kind of reserve do you think a young guy should have in preparation for the plunge? Any suggestions for a me, I seem to be going down a similar path that you have.Thanks 

Element's picture
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Joined: 2011-12-28

I looked at a few places when I decided to go indy.  Raymond James is great but you need to do a fair share of business.  LPL is the 800lb gorilla but they have high fees IMO. Here are the B/Ds that I checked out when I made the move.  In the end, any of them would have worked.United PlannersLPLING Financial PartnersWells Fargo FINETSummit Brokerage If you PM me I'm happy to provide more detail.

FADavo's picture
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Joined: 2011-06-27

STOCKJOCK wrote:Why everyone who truly wants to run their own life,Build a business for themselves and their family Doesn't go independent is beyond me. With accessTo all the products through clearing firms like pershing and National financial services, you hAve the Redources to allow youtoDeal with clients the way you and the clientsAgree rather than being  pushed to offer the Junk the major firms foisted ontbe Public due to stupidity Snd greed.The difference between being a w-2  employe and getting z 1099 id night and dsy.Talk to prople who left wirehouses like me and adk if they Would go back.The people in my wirehouse office seem to have no problem passing their book to their kids...

racefan6320's picture
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Joined: 2010-06-03

I ended up with the "800 lb. gorilla".  I would seriously look into the indy route before going with a bank.  I believe that EJ does their best to show you that going indy is a big mistake and I bought every word.  Therefore when I did leave I didn't feel confident that I could go that route.  After actually doing it I know I was wrong.  I could have done it.  As far as money goes...I think it is an individual thing.  A lot depends on your lifestyle, family situation, etc.  Some firms will help you with some startup money so just ask a lot of questions and explore your options.  Like Element I would be happy to answer any questions you have.  Just PM me sometime.  Good luck!  I know you are going to be happy leaving EJ.  It's a whole different world out there once you walk out from behind the "green curtain."

KingBobby's picture
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Joined: 2011-10-03

KUIT wrote:My long term goal is to go independent but don't feel like I have enough asstes nor do I have much in regards to personal reserves. What indy firm did you end up going with? I'd have to assume there is a lot of initial costs with the move as well, i.e. leases, technology, staff, taxes... Since you have just done it what kind of reserve do you think a young guy should have in preparation for the plunge? Any suggestions for a me, I seem to be going down a similar path that you have.Thanks No, the things you listed are more luxuries than necessities for a new guy. Don't need any expensive technology, don't need to hire any staff, don't need to lease an office (unless you're with a B/D that makes it mandatory which would be silly), and taxes you'll pay regardless of indy or wire. My point is, it's not nearly as expensive as you might think, and the increased payout (more than) helps offset any expenses. But you ought to keep your practice simple anyhow, as prospecting will be more effective.

racefan6320's picture
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Joined: 2010-06-03

I would agree with Bobby.  I do not have staff.  I use the minimum technology to get by (it's amazing how much info google finance has available for free).  I do lease an office but my rent is soooo ridiculously cheap that it's not an issue.  You can afford to go indy, you just need to be smart about it.  

Element's picture
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Joined: 2011-12-28

Be a professional.  Wear a suit.  Have a business card with an address other than your moms basement.  Get an office. Perception is reality. There is a section of society that does not care if you work out of your house.  There is a section that would have a major issue with it.  Why place an extra barrier to success in your way.

KingBobby's picture
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Joined: 2011-10-03

Element wrote:Be a professional.  Wear a suit.  Have a business card with an address other than your moms basement.  Get an office. Perception is reality. There is a section of society that does not care if you work out of your house.  There is a section that would have a major issue with it.  Why place an extra barrier to success in your way.Because for somebody new, it would likely be too costly for many and very unnecessary imo. When prospecting as a rookie, it's much easier to either do business over the phone or go to see them. Getting them to come visit your office would be tough. When discussing something like 22 thousand of tax free income, the subject of tell me a little about your office, doesn't come up. You don't say hey by the why, I'm calling from mamma's basement, party later.. it doesn't come up, and you leave it that way. If someone's worried about it for whatever reason, you can get a vitual office deal pretty cheap, and can be put on business cards.

Element's picture
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Joined: 2011-12-28

You want to bring in real money.  Get a real office.  It's just a fact of life.  Sure there are stories about guys who work out of their homes and killed it but you never hear about the masses that run rinky dink practices or just failed out.As you can see - many different opinions on this subject. Like everything. 

KingBobby's picture
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Joined: 2011-10-03

Element wrote:You want to bring in real money.  Get a real office.  It's just a fact of life.  Sure there are stories about guys who work out of their homes and killed it but you never hear about the masses that run rinky dink practices or just failed out.As you can see - many different opinions on this subject. Like everything.  I'd be surprised if the majority of successful advisors had their own offices starting out. Even in the wires, don't they simply use what's available or ask to borrow an office if they bring somebody 'in' just like an indy can (Never been at one)  Of course when you're established it's a different story, as it's easily affordable. You're right, many dfferent opinions.. but few clients will ask for a tour to confirm one has an office to work out of.. but simply make the assumption.  Real money can be made without not only by confirming an office, but by not even meeting.    

KUIT's picture
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Joined: 2012-01-27

Appreciate all the comments. I'm young in the business but a long way from mama's basement. I did the work from home thing my 1st 6 selling months at Jones, so I know what that's like. I'd say it's more a barrier for me than it ever was for any of my clients. I'm not exactly dealing with the Trumps, the clients I have appreciated me visiting them at their house, or buying them breakfast, some of them I still haven't seen face to face ever. I hated it though because I was always waiting for the "where's your office?" question, but to tell you honestly it probably came up 10 times, in speaking to thousands of people. The bank made me a firm offer today, and it is base plus a reasonable commission grid. I have been researching the firms Element suggested and I've got 10 days to make a decision on the offer. I again appreciate the feedback from the forum and it's making the independent route seem more plausible.

Thanks again

racefan6320's picture
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Joined: 2010-06-03

KUIT, Having been in your shoes, some friendly advice...If I were you I would do everything possible to try to make the indy route work.  Banks are not necessarily bad places to  be, but you have to be very careful.  Especially when you're a salaried employee, banks have the ability to change things anytime they want.  My grid was changed retroactively...that sucks!  I'm by no means saying NOT to go to the bank, just be careful and make sure that indy is for sure not the right route for you.  You have the experience from building a business at Jones to make the indy thing work.  You'll be surprised at how well you can do putting that skill and instinct you picked up at Jones to work for you instead of the GPs.  Good luck!

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Joined: 2012-01-05

braveheart's picture
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Joined: 2005-01-06

Just wanted to chime in.  I agree that Jones reps can do well in the indie space, where as it is more of a learning curve for the wirehouse advisor.  There are also options to connect with an independent platform that are less costly, such as connecting with an estalbished indie office.  Typically the biggest expenses for an indie are office space and support staff, if you have a client base that does not frequent your office, then having a virtual office (which will give you a business address, a professional answering your phone, and a place to conduct meeting when necessary) may be the way to go and the proper use of technology may eliminate the need for full time salaried staff.  Bottom line, there are many benefits to going independent and more options available than ever before. Our focus is working with advisors considering going independent.  feel free to reach out if you have questions or need guidance in the future. 855-GO4-INDI or visit www.GoingIndie.com.Best,Victoria

Bodysurf's picture
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Joined: 2008-08-02

We would love to speak with you.  I'll send you a private message.

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