Month One - go or stay?
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Hello,
Big fan of the forum, so thanks in advance. My question. I have been in the industry now for one month with a major wirehouse. I have seen some things I thought I covered in my research and seen other things that I guess didn't click until I saw them in person, good and bad. The good is the freedom the guys that have been in the industry have and the bad is the cold calling and lack of traction/support the new guys have. I am still in training so I am pre-production, but I am trying to determine my next step. I left the technology industry making around $125k before I took this career change. I was paid decently, but the travel was not appealing. So, I had made the decision to take another job and I also then looked into the FA career. I was offered several FA positions, and I picked what I still feel was the best option. The technology sales job that I turned down was about a $20k pay cut but it didn't involve travel - only local. So, now I have been recontacted my several IT firms wanting me to reconsider. Given that I've seen the new guys bust their tail cold calling for 2-3 yrs and make $100k maybe at year 5 (average), I am wondering if I made a mistake getting into this industry. The other item at hand is there is a more senior FA that has asked me to partner with him. He has roughly $40 million in fee based assets and is looking for someone to help pound the pavement and sell more for him as he's more the analytical and less sales type (his previous clients were brought over from his previous job at a bank). So, I realize I have very much skimmed over this, but the question. Stay an FA? If so, go solo or team up? If I team, is there a timeline/percentage goal I should be looking to confirm? Or just go back to IT and realize that $105k-$110k plus the ability to do other things on the side isn't such a bad option. Oh yeah, my current connections are worth about $750k to $1 million at best. I realize no one can tell me what to do, but some opinions would be appreciated.The idea that you are even asking this question should be your answer in and of itself.
[quote=Gaddock]The idea that you are even asking this question should be your answer in and of itself.[/quote]
I agree with Gaddock. I mean my goodness you haven’t even taken your first exam yet, much less made a cold call or a presentation to a prospect.
Save your employer the wasted training salary and go back to IT. Open up a chair for a guy or gal who is willing to put in the effort.
Typically, FA’s who have other career employment options fail or quit. The FA career is typically mastered by those with their backs against the wall or by those who have burned all their bridges. To succeed in this business, retreat is not an option.
Considering a career "Plan B" is too much of a distraction, when your sole focus should be this career. Given your "techie" connections, I would think that you have a potential inside track to some lucrative prospects (those you know and those you don't). And if you specialize in "Rule 144", you could be especially valuable to a company insider holding a large equity position in a tech firm. What about retirement plans at tech firms? What possible "unique" insights could you give a prospect, who has some tech holdings, that your average "Joe Blow" broker (like me) couldn't? So, in my opinion, you have some advantages that could be profitably exploited. As far as the other broker with $40MM AUM wanting a partner, I'd pass. Unless this broker has some ambitious plans for rapidly expanding his business, his AUM is not high enough to warrant a partner. (Just my opinion. It's your call.) Chances are, since you've already started training, you're obligated (contractually) for training expenses, even if you leave now. So, what to do? Only you can make the call. If you decide to stay, then commit to it. Commit, all the way.I don’t necessarily agree with Gaddock. I think everyone in this business has wondered whether they made the right decision in leaving their former job to become an FA.
After graduating from college, I went to work for a state police agency, but after five years, decided I wanted to be able to spend more time with my family and have an unlimited earning potential. It's amazing how miserable a person can believe they are in their job when they have no other real past work experience to compare it to. (Other than waiting tables in college, and I know that sucks.) I kind of stumbled upon this career because any other job meant moving my family. Do I regret making the change? Sometimes. Primarily because I've learned that I do not enjoy selling, I detest prospecting, and I'm working in a business that is more infested with crooks than anthing I've ever seen. Unfortunately, I had no real way of knowing any of this without diving in head first. I have discovered, however, that I'm fascinated by investments--primarily the analytical side--and I really enjoy the freedom. I don't have a burning desire to "help" people. I became a state trooper not because I wanted to change the world, but because I wanted to drive fast, fight and put bad guys in jail--and I did make a diference in spite of myself. I've enjoyed having all of the holidays off including Thanksgiving, Christmas and New Year's; the flip side of that is that I feel guilty sitting at home on a weekday, because if I'm not working, I'm not selling and thus not adding to my paycheck. My income is roughly what it was when I was a trooper, and the monthly variations are maddening, but I hold fast to the promises that if I "hang in there," I'll be making the big bucks in a couple years. There's my story. I don't know what you should do, except know that you're not alone in your doubting whether you made the right decision.You are either all in or you are all out. Sounds to me like you realize you made the wrong decision. Do a little soul-searching on Tuesday when the market is closed. Do what is best for you. If you are going to get out of the business, do it on the best terms possible.
You need to ask yourself some questions to be sure that you’re questioning the INDUSTRY, or your current FIRM?
I mention this because you mentioned the SUPPORT aspect of the industry as being disappointing. This is truly an ENTREPRENURIAL career. By you mentioning the salary and income levels, it appears that your mindset isn't there. (But then, MOST people's mindset isn't there when they first start out.) Are you looking for more security and less potential pay? "Those who give up liberty in favor of safety have neither liberty or safety." Believe me, I learned this the hard way. If you stay, you need to do something different to get the support you need and desire. Might I suggest you enroll in local FSS courses via The American College? I think you might get a lot out of the "Prospect or Perish" course. http://www.theamericancollege.edu/subpage.php?pageId=250 If anything, you might discover if you feel that you have what it takes to survive and thrive, or to just "fish and cut bait" in this industry. Sometimes we need to find our OWN best support tools and network.Regarding the “opportunity” to partner, tread carefully. Is he/she looking for a junior partner who will eventually become a peer partner, or is he/she looking for a prospector?
If the latter, pass. If looking for a real partner, make him prove it by agreeing (in writing) that assuming you hit clearly stated goals, that are realistic, you will progress, say 10% a year till you are both 50/50 partners in the pooled business. After all, its not like the guy is a million dollar producer. $40 million assets is not that much. With that said, I think Bondo and Doberman said it best. In this business, you need to forget everything else that may or may not be available to you. You need to be all in, totally immersed. Otherwise, dont bother, you'll fail. Sounds harsh, but its a fact.BINGO & well said. You have to be 100,000% on board with this thing to make it work. IM very HOYou are either all in or you are all out. Sounds to me like you realize you made the wrong decision. Do a little soul-searching on Tuesday when the market is closed. Do what is best for you. If you are going to get out of the business, do it on the best terms possible.
+1 on the all in accessment. That said, what you’re going through is something we all have gone through. It’s normal to question the path.
To succeed here takes total committment. Yes it takes time to get this career off the ground. But once airborne it's only up. The choice becomes work half as much or make twice as much. Each decides which it will be. If you are happy working a 20 hour week making $100k, you're in the right seat. If you want to make $200k a year working a 20 hour week, just push for another couple years and it's done. If you want to make a million dollars a year keep pushing at trainee thrust for about ten years. Then throttle back and enjoy. This business gives you many options in the financial freedom column. However, if you are under the impresson that we top out at about 100k, that would be wrong. How much you make is all about how hard and how smart you work and how long you work that hard and that smart. As for partnering up, it depends. A partnership is a marriage. Like a marriage both partners must bring something to the relationship. Noone here is impressed with your senior broker's 40 mil aum. That doesn't disqualify him as partner, it tells us he doesn't have much of a base to offer you. IMO you'd be better off going it alone for now. You haven't had one day of prospecting. From where you sit it looks scary. It's normal to question whether you can do this. Give youself a chance to find out. IT isn't going anyplace. it will be there five years from now if it turns out you don't like this.[quote=Borker Boy]I don’t necessarily agree with Gaddock. I think everyone in this business has wondered whether they made the right decision in leaving their former job to become an FA.
After graduating from college, I went to work for a state police agency, but after five years, decided I wanted to be able to spend more time with my family and have an unlimited earning potential. It's amazing how miserable a person can believe they are in their job when they have no other real past work experience to compare it to. (Other than waiting tables in college, and I know that sucks.) I kind of stumbled upon this career because any other job meant moving my family. Do I regret making the change? Sometimes. Primarily because I've learned that I do not enjoy selling, I detest prospecting, and I'm working in a business that is more infested with crooks than anthing I've ever seen. Unfortunately, I had no real way of knowing any of this without diving in head first. I have discovered, however, that I'm fascinated by investments--primarily the analytical side--and I really enjoy the freedom. I don't have a burning desire to "help" people. I became a state trooper not because I wanted to change the world, but because I wanted to drive fast, fight and put bad guys in jail--and I did make a diference in spite of myself. I've enjoyed having all of the holidays off including Thanksgiving, Christmas and New Year's; the flip side of that is that I feel guilty sitting at home on a weekday, because if I'm not working, I'm not selling and thus not adding to my paycheck. My income is roughly what it was when I was a trooper, and the monthly variations are maddening, but I hold fast to the promises that if I "hang in there," I'll be making the big bucks in a couple years. There's my story. I don't know what you should do, except know that you're not alone in your doubting whether you made the right decision. [/quote]Borker I remember some of your earlier posts where you were expressing doubts on whether you wanted to stick this thing out or not. The difference between you and this fellow is that you started feeling doubt and frustration once you were out prospecting and living on a variable income.
This guy is already counting the eggs he could make in the tech world, and he doesn't even have a series 7 yet.
Hmmmmm...if state trooper paid better, I'd be interested in that! On a serious note, I'm not sure the Jones model is right for you, given what you've stated. What I did (affiliate as an independent with a CPA firm) sounds like it would appeal a lot more to you than what you're doing. The only problem is, I'm not sure that you yet have the critical mass to make that work unless the CPA firm can feed you a lot of prospects. One other thing you might consider since it sounds like it better fits your personality, is a bank program. There's a lot less selling and prospecting required in a good bank program (notice, I said a GOOD bank program) and a lot more investment management. Likewise, the CFP might be a good investment for you. As for the original poster, I think given what you've told us, you should go back to your old industry. Given your background, I doubt you're willing to make the sacrifices required to get to where you want to be.I became a state trooper not because I wanted to change the world, but because I wanted to drive fast, fight and put bad guys in jail.
[quote=Indyone]
Hmmmmm...if state trooper paid better, I'd be interested in that! [/quote] As far as having fun goes, I don't think there's a job out there that can beat it. Unfortunately, troopers work when everyone else is off, and vice versa.If you have to ask, chances are you might think of going back—I’ve been in this business 15 years and if I had been making 125k prior to becomming a FA, I might have thought twice
I agree with most of the comments, and would add this.
What is it you WANT to spend your time doing? The ways an FA spends his time are different from an IT consultant. I find it telling that you didn’t discuss anything about what you prefer doing - just what you don’t like about each.
Sounds like the old adage that goes something along the lines of: "I know what I am running from, but I’m not really sue what I’m running TO."
If you don’t know where you want to go, any road will get you there.
I would go back to IT. Seems that most IT people aren’t what I call ‘people persons’. This business is hard with many people with people skills not making it… My advice would be to go with the best IT offer. I wish you the best in your decision…
Remember, a bird in hand is better than two in the bush. Miss JI ditto a lot of the sentiments on this issue. Go back and leave your aggravations that you will face at the door! Plus, your $40 Million SR producer is not really a SR producer! If he/she was $100 Million + then you are talking about a worthwhile partnership. But a $40 Mill isn’t going to get you far.
He/she will end up using you for all the cold-calls in the world then you will walk out without your SR even telling you to leave! He/she would have gotten cheap labor and increased his book size while you did all the work. But ultimately, you would get burned out by it all to leave it behind for your SR to enjoy.[quote=Robinhood]I ditto a lot of the sentiments on this issue. Go back and leave your aggravations that you will face at the door! Plus, your $40 Million SR producer is not really a SR producer! If he/she was $100 Million + then you are talking about a worthwhile partnership. But a $40 Mill isn’t going to get you far.
He/she will end up using you for all the cold-calls in the world then you will walk out without your SR even telling you to leave! He/she would have gotten cheap labor and increased his book size while you did all the work. But ultimately, you would get burned out by it all to leave it behind for your SR to enjoy. [/quote] This is EXACTLY what happened to me. I helped a senior guy increase his book from $35m to about $65m in 1.5 years (well, we BOTH did it) and I left out of frustration because I ULTIMATELY WORKED FOR HIM. When it came time to discuss my partnership split, well, I wasn't even included in the discussion. It was decided FOR me. So I left to go to a firm where I would decide how much I get paid (by my own activities and sales).If you are already considering plan B I would estimate your odds of sticking with plan A permanently are less than 5%. Save yourself the all the time, money and frustration and go back to Plan B now.
I’ll make it simple for you. You have to decide if you wan to be a business owner or an employee.