So ya' wanna be a Stock Broker?

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dude's picture
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OK boys and girls, for those who have an interest in becoming a Financial Advisor, Stock Broker, Investment Representative or whatever.....  Here are some thoughts which may be helpful in your decision to pusue this career.
1 in 10 make it in this business
You will work like a slave for at least 5 years, with the majority of your daily activity focused on approaching strangers and asking them for money, most of these people will not want to talk to you.
You will be VERY good if you are closing 50% of your prospects in your first year or two.  More likely is 20%.  (you may eventually close some of the ones you weren't able to down the road though)
Each account you try to earn will require quite a bit of work to get from a "cold" contact to a proposal.  You have the marketing, selling the client on a meeting, meeting the client to profile, analyzing the client's portfolio, preparing proposals, contacting other advisors (attorney's, CPA's etc..) researching miscelaneous issues, educating the client, presenting your proposal and addressing objections.  All the while you'll only reap rewards from 20% to 30% of the people you do all this work for. 
You'll most likely be broke for a couple years..... so have some serious $ saved (or don't have kids and a wife). 
If you're married with a spouse who stays at home, you have another major obstacle because no matter how eloquently you describe the business and it's requirements, they have NO way to really appreciate the intensity and challenge.  All they see is that you're never home and when you are, you are pretty drained.  All the while they are pissed about making next to nothing.  Needless to say I'm sure Stockbrokers are high on the list of broken marriages.
You can pretty much count on being a marketing machine during your waking hours.  Even if you're trying to relax at a party, when someone mentions money or finances you will subconsciously be thinking of ways to steer the conversation into an opportunity to get their money (it's natural when you are starving for business).  In fact it will be difficult for you to not think of people in terms of business opportunity.  It will consume your days, nights and dreams (mostly nightmares ). 
When it's all said and done and you have been lucky enough to suceed,  you'll be at a high risk of heart disease and other stress related ailments, unless you are truly gifted in stress management.
The above being said, it is my belief that the following types of folks have some serious disadvantages to succeeding as a Financial Advisor:
1) Young, little professional experience, no wealthy contacts
2) Young, married with kids or married with young kids
3) Fear of initiating conversations with an agenda
4) Sales phobic
The following types of folks might have a chance
1)  Older seasoned sales professional with deep contacts
2)  Young (or older) extraordinarily motivated marketing guru
3)  Young or older individual with a strong warm market of people with money, willing to give you money.
Now here's food for thought.  Almost all of the well established Brokers I know (this is in the multiple dozens) say that if they had to do it over today, they would probably choose a different career.

troll's picture
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It has been a challenge.  No way I'd want to do anything else(now that I'm clearly too old to be a professional heavy metal guitarist).
I think Blarm might take issue with some of your statements.  He's done rather well for himself.

dude's picture
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Joe,
I'm generalizing.  Blarm is definitely exceptional and you know it. 
I wanted those with eyes bigger than their stomachs to get a taste.

dude's picture
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joedabrkr wrote:
It has been a challenge.  No way I'd want to do anything else(now that I'm clearly too old to be a professional heavy metal guitarist).
I think Blarm might take issue with some of your statements.  He's done rather well for himself.

I tried the professional guitarist gig (made $ at it too), not all that it's cracked up to be, in  fact it makes being a stockbroker look easy.  You may not realize it but the amount of work to reward ($$$) ratio is way worse than a 1st year stockbroker with a far lower probability of sucess.  Plus the leather pants, makeup and wigs are a pain in the ass .

dude's picture
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joedabrkr wrote:
It has been a challenge.  No way I'd want to do anything else(now that I'm clearly too old to be a professional heavy metal guitarist).
I think Blarm might take issue with some of your statements.  He's done rather well for himself.

I tried the Rock Guitarist gig, it's not all it's cracked up to be.  In fact the work to reward ($$$) ratio is far worse than a 1st year stockbroker.  Plus the leather pants, makeup and wigs are a pain in the a*s.

dude's picture
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Oops, looks like a double post.  sorry for any confusion

7GOD63's picture
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Nice post. Solid and good advice.
Hey do you view a wife who works, without the kids, as a pro?

anabuhabkuss's picture
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well I just got married, we're in our late 20's and starving as is so i guess we're pretty much ****** here pretty soon once i get licensed :)

skeedaddy's picture
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I don't know what prompted this thread, but here's my experience. At an
interview at Morgan Stanley, back when Morgan Stanley was Morgan Stanley,
the VP asked me how many millionaires knew who I was. Read it again if
you must.   

If I had to choose another career, I would have studied engineering instead
of finance and become a builder/developer. I would have traded in my
Brooks Brothers suit for a pair of khakis and my BMW for a Range Rover.

babbling looney's picture
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I tried the Rock Guitarist gig, it's not all it's cracked up to be.  In fact the work to reward ($$$) ratio is far worse than a 1st year stockbroker. 
I was a singer with a jazz/blues band (way back when in SF in the late 70s) and I agree.  You spend uncounted hours of practice if you can get everyone in the same room at the same time.  Gives a whole new take on herding cats.  When you get a job you make squat and end up drunk or worse to boot.  Rinse and repeat.  Probably 1 in 2000 make it in the music industry.
Plus the leather pants, makeup and wigs are a pain in the a*s.
All but for the wig, I agree
Joe has a good point.  Without trying to discourage the wanna bees it is important to go into the biz with eyes wide open.  I seriously don't see how people with small children and a stay at home spouse can make it in the first few years and still keep a home life. That being said.  I love what I do and can't think of anything else better.....except to change places with Bonnie Raitt instead.

dude's picture
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7GOD63 wrote:
Nice post. Solid and good advice.
Hey do you view a wife who works, without the kids, as a pro?

That's a workable situation.  The wife will be much more understanding since she is in a similar boat.

dude's picture
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To clarify,  if you are married, it's my belief that it's much much better to have a working spouse (preferably in a professional field) than a spouse who stays at home if you're going to pursue this business. 
I should note that I'm speaking from personal experience here.  My wife (soon to be ex wife) was/is a stay at home mother (we have 2 younger children).  The biggest issue I have faced with her concerning my job is a complete lack of appreciation of the challenge and required dedication to be successful.  I don't blame her though 'cause she's home alone with 2 young children all day without a break.  Knowing what I know now, I probably would have avoided this career (even though I love what I do) simply because it has caused my family a great deal of strife. 
 

BankFC's picture
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You're getting a divorce because you're spending too much time building your business??
I don't care who you are, when you are BUILDING A BUSINESS/PRACTICE, be it a contractor, developer, doctor, lawyer, etc you spend A LOT of time doing it.
If a woman wants a clocker watcher husband who is home at 5:15 on the dot every night, good for her.  Just don't be pissed you are driving the '95 Taurus instead of the BMW.
I work 60 hours a week now EASY.  It just habit for me at this point.  I remember when I first graduated college thinking how much it would suck to work a WHOLE 40 hours.  I have no idea what is even on television before 6:00 (I know Cramer is on then). 
Then again, I have no wife, no kids, no dog, not even a plant.  I like it that way.  I also have no debt (outside a mortgage), no b*tching wife, and I put away a lot of money, both inside and outside my 401k, I go wherever I want on the weekends, etc
I am pretty sure the whole marriage thing is more hassle than it's worth at this point. 
 

doberman's picture
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Good thread and good posts, dude.

troll's picture
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dude wrote:
To clarify,  if you are married, it's my belief that it's much much better to have a working spouse (preferably in a professional field) than a spouse who stays at home if you're going to pursue this business. 
I should note that I'm speaking from personal experience here.  My wife (soon to be ex wife) was/is a stay at home mother (we have 2 younger children).  The biggest issue I have faced with her concerning my job is a complete lack of appreciation of the challenge and required dedication to be successful.  I don't blame her though 'cause she's home alone with 2 young children all day without a break.  Knowing what I know now, I probably would have avoided this career (even though I love what I do) simply because it has caused my family a great deal of strife. 
 

Yes having a working spouse helps with short term income fluctuations and understanding of a demanding schedule. However, it gets much more complicated when kids are in the picture....

Ricky Roma's picture
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Great post- I could write for hours on this one.  But I'll spare you.
More than 1/10 survive.  Likely the "1" is the person who actually survives/succeeds on their own merits.  There are others who are connected, inherit a book, get that magical call-in, etc.  Or the son who joins the father's "business."
I wouldn't do it again from scratch.  I started with nothing but a desk and a phone.  100 hour weeks were commonplace for me in the first 5 years.  I still work 75, but at least now I'm well compensated for it and get to work "smart." But I digress.
More to share.  After all, I'm "The Judge."  Anyone recall?
Hutch?.........
 
 

blarmston's picture
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Great initial post Dude. Those are the realities that we all face. Whether we are studying for the 7 or 2 years in or 15, some if not all those points hit a nerve with us all.......

7GOD63's picture
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On top of the family advice. Would you agree that husband & wife should work as a team. If the wife is professional then she could refer clients to husband. The husband/broker/PFA has a better chance of networking at events, gatherings and functions with the wife?

VotedforKerry's picture
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Dude?  What the f**k?  Here's a bit of advice and maybe not what you want to hear.  Family comes first.  I LIKE my job but I LOVE my family.  For some reason I was under the impression you had those two reversed.

liquidasset's picture
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I had a great manager/mentor once take us out spouses included. He gave the best talk I have ever heard. He thanked all the spouses for being supportive, and understading.I having no spouse, can't relate. I just can imagine it would be tough to feed another mouth or mouths when you first begin.

skeedaddy's picture
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Sorry to hear about your marital status, especially when kids are involved.
Do your best to stay involved with them. I wonder sometimes how I've kept
my wife through all the ups and downs. At one point in 2001, I was bringing
home half the income. Any other woman would have dumped me there and
then. I consider myself among the lucky ones.

We've been broke, but never poor.

dude's picture
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7GOD63 wrote:
On top of the family advice. Would you agree that husband & wife should work as a team. If the wife is professional then she could refer clients to husband. The husband/broker/PFA has a better chance of networking at events, gatherings and functions with the wife?

Absolutely.  I think that the advisors business should be looked at in some ways as a joint operation (if you can get along w/ your spouse in that manner).  A new guy/gal needs all the help he/she can get.  Also, involving the spouse gets them to buy into the career, which I have found to be a challenge not only for myself but other young married brokers.

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joedabrkr wrote:dude wrote:
To clarify,  if you are married, it's my belief that it's much much better to have a working spouse (preferably in a professional field) than a spouse who stays at home if you're going to pursue this business. 
I should note that I'm speaking from personal experience here.  My wife (soon to be ex wife) was/is a stay at home mother (we have 2 younger children).  The biggest issue I have faced with her concerning my job is a complete lack of appreciation of the challenge and required dedication to be successful.  I don't blame her though 'cause she's home alone with 2 young children all day without a break.  Knowing what I know now, I probably would have avoided this career (even though I love what I do) simply because it has caused my family a great deal of strife. 
 

Yes having a working spouse helps with short term income fluctuations and understanding of a demanding schedule. However, it gets much more complicated when kids are in the picture....

 
Amen brother.

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Also, involving the spouse gets them to buy into the career, which I have found to be a challenge not only for myself but other young married brokers.
WOW THE KEY WORD is "YOUNG". Good article on CT with the lowest rate of getting hitched (highest marrige-phobic). Higher education results in more optomism of marrige. On top of this CT has the lowest divorse rate.
They were talking about states such as Hawaii, LA, Nevada, Arkansas and Mississippi as the highest chance to get married. These states also have the lowest income and highest divorse rates.
There is also a ton of studies pointing to a healthy family/marrige results in much higher income then the other.
Dude, were you young 20's for marrige?

skeedaddy's picture
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7GOD63 wrote: There is also a ton of studies pointing to a healthy
family/marrige results in much higher income then the other.

Its true that a bigger bank account smooths out many issues in a marriage.
But the stats you speak of have to do with the fact that divorce is very costly
(separation of assets) for an affluent marriage. Not to mention the
embarrassement at the yacht club, country club, and at the private school
the kids attend. So the husband keeps a girlfriend on Wednesdays and the
wife does the pool guy on Thursdays so each can put on a happy face on
social Fridays while they drink a 1/5 of scotch to numb the pain.

7GOD63's picture
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Ahhhhhhhhhhhhhhhhh... I don't look forward to that future. One of the union guys says when the wife turns fifty trade her in for two 25's.

dude's picture
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Dude, were you young 20's for marrige?
I was 21 when I got married, 25 when I became a broker.  Had my first child @ 22 and my second the month I went into production.

troll's picture
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skeedaddy wrote: 7GOD63 wrote: There is also a ton of studies pointing to a healthy
family/marrige results in much higher income then the other.

Its true that a bigger bank account smooths out many issues in a marriage.
But the stats you speak of have to do with the fact that divorce is very costly
(separation of assets) for an affluent marriage. Not to mention the
embarrassement at the yacht club, country club, and at the private school
the kids attend. So the husband keeps a girlfriend on Wednesdays and the
wife does the pool guy on Thursdays so each can put on a happy face on
social Fridays while they drink a 1/5 of scotch to numb the pain. Oh man you mean I got it all screwed up and backwards again?  So you're telling me my WIFE was supposed to be doing the pool guy?  Damn I gotta go find me a girlfriend and some scotch!

skeedaddy's picture
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Joe,

Did you identify with Brokeback Mountain?   

babbling looney's picture
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skeedaddy wrote: 7GOD63 wrote:

There is also a ton of studies pointing to a healthy family/marrige results in much higher income then the other.
Its true that a bigger bank account smooths out many issues in a marriage. But the stats you speak of have to do with the fact that divorce is very costly (separation of assets) for an affluent marriage. Not to mention the embarrassement at the yacht club, country club, and at the private school the kids attend. So the husband keeps a girlfriend on Wednesdays and the wife does the pool guy on Thursdays so each can put on a happy face on social Fridays while they drink a 1/5 of scotch to numb the pain.
You could always do like I do and make cookies along with the scotch.  (see the joke thread)  Can I do the pool guy?  I really don't want a girlfriend.
Seriously, this career is really tough on a marriage and especially with small children.  I count myself fortunate that my spouse is really understanding. He has his own business and knows how much work and prospecting it takes to be successful.  He is one of my best referral sources: his clients to me.   
I agree that you need to try to engage the spouse (stay at home or working spouse) in the business so they can see what you do instead of what they think you do.  I am guessing that the wife at home with small kids thinks that your day is a walk in the park.  You know a nice office, computers, no whining kids, no dirty diapers and lots of scintillating conversations and then you come home from your cushy job where you get to wear neat new clothes instead of crappy housewife clothes and then you demand a meal and some peace and quiet.  You get to golf and socialize and she is stuck with the diaper pail.  Am I close?     
This is why it is so important that your partner in life be aware of what you really do and how stressful your day is and able to understand why you can't just let it go at the office door. I don't know what the answer is for how you educate the spouse.

valuebroker's picture
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Here is a funny one for everybody!What is the difference between a Large Pizza and a Seg. 1-2 EDJ IR??Give Up??The large Pizza can feed a family of 4. Got that one from an old Jones Buddy!

ezmoney's picture
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you got that right!!

dude's picture
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VotedforKerry wrote:Dude?  What the f**k?  Here's a bit of advice and maybe not what you want to hear.  Family comes first.  I LIKE my job but I LOVE my family.  For some reason I was under the impression you had those two reversed.
Congratulations VotedforKerry.  Actually, I wake up every morning and make sure my kids get their daily cigarette burns (before my daily wife beating) for being such pain in the a*ses.  This is usually before I let them out of the cellar and change out their drinking bowls.  Unfortunately I have to always dress them in long sleeves to cover up the marks on their wrists from the shackles (had to tighten them, the kids were slipping out) which draws attention on hot days (it gets to 105 degrees in summer). 
Anyway thanks for the tough love there Voted.
 

BrokerRecruit's picture
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That's a pretty entertaining joke.

dude's picture
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BrokerRecruit wrote:That's a pretty entertaining joke.
Joke, what joke?

dude's picture
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BrokerRecruit wrote:That's a pretty entertaining joke.
Oh........you mean VotedforKerry's post.

Windknot's picture
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This message string is one of the best that a newbie/trainee/rookie can read to get a good sense of what to expect as an FA.  Is there any chance that the moderators/administrators of this board could keep it posted at the beginning of the "Rookies" forums? 
I have seen other forums do this as a "sticky note" at the head of the forums - that way there would be a lot less repeat/rehashed/regurgitated information out there. 
Any suggestions moderators? 
I know...the new guy causin' trouble.  That's what I do best.
Windknot

Slim2None's picture
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Geez, after reading this thread, I'm glad I'm only gonna be doing this for the summer. 

brothaK's picture
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does the stress and all the anoyances differ from the independents to the wirehouses?I'm assuming everyone who is hating on their job is in a wirehouse (ML SB MS)and all independents love their jobs and couldnt be more happier.

troll's picture
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brothaK wrote:does the stress and all the anoyances differ from the independents to the wirehouses?I'm assuming everyone who is hating on their job is in a wirehouse (ML SB MS)and all independents love their jobs and couldnt be more happier.I am happy as an independent.  There is still plenty of stress, and the workload is nothing to sniff at.  It is, perhaps, higher than being at a wire.The difference, I suppose, is that I don't have others imposing their priorities on me, except perhaps my clients.  No sales manager or branch manager pushing their goals or 'favored vendors' on me.  No endless useless meetings.  In the end, I decide how to deal with things and what issues to address first.  And....it's MINE.So much of the stress from being in a wirehouse came from a few sources-1.) Having people who really knew NOTHING about my clients or what it was like to be on the front lines push their priorities, programs, and products at me.2.)  The difficulty of getting approval to spend money when needed to address issues.3.) Bureaucratic compliance people.4.)  The feeling of being 'trapped', that it was difficult to get out and be in a better situation.5.)  The constant threat that assistance would be withheld if certain goals weren't met.I don't have to deal with any of that crap now.  So, even if I have to work a little harder sometimes it's just fine by me.

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joedabrkr wrote: brothaK wrote:does the stress and all the anoyances differ from the independents to the wirehouses?I'm assuming everyone who is hating on their job is in a wirehouse (ML SB MS)and all independents love their jobs and couldnt be more happier.I am happy as an independent.  There is still plenty of stress, and the workload is nothing to sniff at.  It is, perhaps, higher than being at a wire.The difference, I suppose, is that I don't have others imposing their priorities on me, except perhaps my clients.  No sales manager or branch manager pushing their goals or 'favored vendors' on me.  No endless useless meetings.  In the end, I decide how to deal with things and what issues to address first.  And....it's MINE.So much of the stress from being in a wirehouse came from a few sources-1.) Having people who really knew NOTHING about my clients or what it was like to be on the front lines push their priorities, programs, and products at me.2.)  The difficulty of getting approval to spend money when needed to address issues.3.) Bureaucratic compliance people.4.)  The feeling of being 'trapped', that it was difficult to get out and be in a better situation.5.)  The constant threat that assistance would be withheld if certain goals weren't met.I don't have to deal with any of that crap now.  So, even if I have to work a little harder sometimes it's just fine by me.
You're wrong, your clients fit a profile that is common to lots of other clients.  You're also wrong when you declare that those who supervise have never been there themselves.  Very few sales managers, branch managers and regional managers have not come up through the ranks.
Difficulty spending money to address issues?  What does that mean?  What did you want to spend money on that somebody else vetoed?
Bureaucratic compliance people?  If there is any area of a brokerage firm that cannot be run "loosey goosey" it is the compliance area.  It is a common complaint among the sales force that they'd be able to sell a lot easier if there were not so many rules.  But there are rules and those who insist that they be followed are not the enemy.
Trapped?  The fact that you broke away and became Independent is proof that nobody is trapped.
What are examples of help that is withheld?

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From what I see an INDY can be very busy. It is obvious that one would not choose this route till they are established.
Also being INDY is similar to opening a new business. When the phone rings you need to be there.
Do most INDY's offer everything from business development, taxation, mortgages, insurance, wealth and investment advice (personal & corporate)? From what I see they do or have refferals to get a cut.
The bottom line is like a small business there is huge gratification with developing and building something that is yours. Also no one to take your cut of the pie or stand by your desk to get the new sales numbers. Also it is nice to have the flexibility to push any product on the earth (obviously following the due diligence and compliance rules).
The major problem to going indy is survival. If 9 out of 10 fail (first year or two) then you need experience and a customer base (that will transfer). As I see it you have limited marketing and support compared to the large firms (training & time).. Any expense is coming out of your pocket.  EVERYTHING STATED here is from 2.5 years of observation and inquiries.
 

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I went from a bank to indy last summer and can tell you that I agree with most of what 7 & Joe had said above (and 7...I appreciate the disclaimer you are putting in your posts.  If you don't, Joe will quickly hammer you back into your rightful place, eh, Joe?!!).  To elaborate, yes, being indy is a very rewarding career move for me after a whopping nine months in the business.  I have less than half the assets ($22 million thus far), yet make every bit as much money as I did before.
I also know the pain of trying to get money spent in a bureaucratic organization that watches every penny and cannot see past those pennies to the real dollars saved/earned by making modest investments.  As an indy, I have made those investments and am now reaping the benefits of things such as a Plantronics CS50 wireless headset.  I have no doubt that the $150 spent has been reaped several times over in efficiencies of being able to talk while I am going down the hall to retrieve files, etc., and the beauty is, I didn't have to cost-justify a thing...I just bought it.  Likewise for the 24" flat screen TV (less than $200) in the corner of my office with the CNBC ticker running all day long.  I don't think there is anything I could have said to my old employer to get such a thing in my office...they would have been scared to death that I might waste a few of their precious minutes during the work week.  Now, when clients call in and want to know what is going on, I can quickly tell them without spending all day glued to the tube.  The benefits of appearing on top of things is hard to measure, but valuable...I'm convinced of that.
...and yes, BEF is correct that for the most part, we aren't really trapped.  At the same time, while I wasn't trapped in the end, I felt trapped while I worked there, and it was only through much effort, money and perseverance that I was able to make the jump.  It is also my understanding that my former employer made several moves after I and others left to make it much more difficult to make the jump, so if I felt trapped then, I'm confident that those who stayed feel doubly trapped now.
At the same time, indy is absolutely not for everyone. 7 makes some great points (especially for a rook ) about survival and the need for experience.  In addition, being a do-it-yourselfer plays a big part in you success as an indy.  I'm also a CPA, so I take care of my own payroll, file my own corporate tax return, etc.  Much of what would otherwise be fairly costly (especially in the beginning) was done at no cost, other than my time.  Office administration is not difficult fo me, but if you are a natural salesman, and admin is not your strong suit, you may not be well-suited to make the transition to indy, unless your practice is large enough out of the gate to hire someone to take care of all the admin stuff.  For many folks in the biz, the support is worth the cost in lost payout.  With what I can do (and did do in the bank setting) fo myself, a 40% (or even 50%) payout seems like a rip-off.
For me, ther's no question I'm happier, but that doesn't mean that everyone would be.  It would be interesting to hear from someone who went indy and regretted it...surely those folks exist also?!!

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7GOD63 wrote:From what I see an INDY can be very busy. It is obvious that one would not choose this route till they are established.how about independent COMPANIES    working for them, starting with them... etc

7GOD63's picture
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Second that... Would like to hear from an INDY that regretted it? Or the negatives of going Indy?
I am sure there are people who went back....  For sure it seems the large firms are doing everything they can to protect from defecting. Looking at their revenues I don't see these "defectors" (firm view) are effecting the bottom line.
As for the current trend of new people wanting to go INDY... I think it is damn near impossible. If I was Indy with 20-100m AUM I would never hire someone over an assistant or fully qualified RR. The risk is just to high. Maybe someone with a solid background (integrity, networking, MBA and diverse business experience) could be worth a shot, but in general a new college grad no way. Maybe pay for an assistant with BA to help with everything from presentations to thank you/follow up letters, but nothing risky (direct client interaction for years).  
Has anyone here went INDY with no experience? Right out of college?
Haaaaa... Just figured out name INDY-ONE.

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BrothaK.. my opinion is based on common sense.. If I were making 100- 150bp on 10-150 million why would one want to waste time (limited as it is) on a project. Equation of income is anywhere from 100k to  1.5 million (- expenses) yearly.
If you spent a few years with a big firm (obtain clients and skills) and could prove to me then I would think about this... EVERYTHING I say here is based on my position 3 years from today.
Now there is the possiblility that a growing Indy could use an assistant to bring in the money, but then how would they pay? And if they are growing why would they require someone who knows nothing to assist. Remember that one can study the 7 and in reality they know nothing. Sorta like a tech school student in the Navy who spends a year on electronics systems. When they get out you have have to help and monitor them soldering a capacitor.

troll's picture
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Joined: 2004-11-29

7GOD63 wrote:From what I see an INDY can be very busy. It is obvious that one would not choose this route till they are established.
Also being INDY is similar to opening a new business. When the phone rings you need to be there.
Do most INDY's offer everything from business development, taxation, mortgages, insurance, wealth and investment advice (personal & corporate)? From what I see they do or have refferals to get a cut.
The bottom line is like a small business there is huge gratification with developing and building something that is yours. Also no one to take your cut of the pie or stand by your desk to get the new sales numbers. Also it is nice to have the flexibility to push any product on the earth (obviously following the due diligence and compliance rules).
The major problem to going indy is survival. If 9 out of 10 fail (first year or two) then you need experience and a customer base (that will transfer). As I see it you have limited marketing and support compared to the large firms (training & time).. Any expense is coming out of your pocket.  EVERYTHING STATED here is from 2.5 years of observation and inquiries.
 (in best "kung fu" voice)  :You have learned well, grasshopper.  You make me proud!" ::folds arms and wise smile, fade to black, theme music::I suspect in the end your observing and questioning will serve you well when you take the leap!  Go get 'em.

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Big Easy Flood wrote:joedabrkr wrote: brothaK wrote:does the stress and all the anoyances differ from the independents to the wirehouses?I'm assuming everyone who is hating on their job is in a wirehouse (ML SB MS)and all independents love their jobs and couldnt be more happier.I am happy as an independent.  There is still plenty of stress, and the workload is nothing to sniff at.  It is, perhaps, higher than being at a wire.The difference, I suppose, is that I don't have others imposing their priorities on me, except perhaps my clients.  No sales manager or branch manager pushing their goals or 'favored vendors' on me.  No endless useless meetings.  In the end, I decide how to deal with things and what issues to address first.  And....it's MINE.So much of the stress from being in a wirehouse came from a few sources-1.) Having people who really knew NOTHING about my clients or what it was like to be on the front lines push their priorities, programs, and products at me.2.)  The difficulty of getting approval to spend money when needed to address issues.3.) Bureaucratic compliance people.4.)  The feeling of being 'trapped', that it was difficult to get out and be in a better situation.5.)  The constant threat that assistance would be withheld if certain goals weren't met.I don't have to deal with any of that crap now.  So, even if I have to work a little harder sometimes it's just fine by me.
You're wrong, your clients fit a profile that is common to lots of other clients.  You're also wrong when you declare that those who supervise have never been there themselves.  Very few sales managers, branch managers and regional managers have not come up through the ranks.
Difficulty spending money to address issues?  What does that mean?  What did you want to spend money on that somebody else vetoed?
Bureaucratic compliance people?  If there is any area of a brokerage firm that cannot be run "loosey goosey" it is the compliance area.  It is a common complaint among the sales force that they'd be able to sell a lot easier if there were not so many rules.  But there are rules and those who insist that they be followed are not the enemy.
Trapped?  The fact that you broke away and became Independent is proof that nobody is trapped.
What are examples of help that is withheld?No fool, you are wrong.  But I rather suspect you are a firmly entrenched member of the professional wirehouse bureauracracy, so I would expect your answer to be as such.  You're living off the teats of the organization, so you defend it.Our compliance department is far more progressive and business oriented than the one I faced at UBS.  Yet, they are not foolish.  Too, I have my 24 and am fully aware of my responsibilities, rather than being 'lectured' by an overpaid political hack such as a wirehouse branch manager.Yes many of those in supervision in the wires were once in production.  Very few of them were successful in production, however, or they never would have gone into management.  Rather, they were surviving but mediocre, and picked as being 'good potential management material'.  (See my references above to 'political hacks'.  Add a dose of paper shuffling and 'mouthpiece for upper management' and you get the picture.)Difficult to spend money?  Yep.  You bet.  Especially if your branch manager is trying to hit is profit goal in the last quarter so he can get his bonus and buy a new S-class Mercedes or refinish his kitchen.  Especially if you have a marketing idea that creeps even slightly outside the box.  The wirehouse environment is one that prizes conformity.No nobody is trapped, but it wasn't easy.  It took over a year of planning, working nights and weekends, while putting on my 'game face' and going to the office and acting like everything was hunky dory.  It was sorta like living in a spy movie.  But, in the end it was worth every bit of it!

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Indyone wrote:I went from a bank to indy last summer and can tell you that I agree with most of what 7 & Joe had said above (and 7...I appreciate the disclaimer you are putting in your posts.  If you don't, Joe will quickly hammer you back into your rightful place, eh, Joe?!!).  To elaborate, yes, being indy is a very rewarding career move for me after a whopping nine months in the business.  I have less than half the assets ($22 million thus far), yet make every bit as much money as I did before.
I also know the pain of trying to get money spent in a bureaucratic organization that watches every penny and cannot see past those pennies to the real dollars saved/earned by making modest investments.  As an indy, I have made those investments and am now reaping the benefits of things such as a Plantronics CS50 wireless headset.  I have no doubt that the $150 spent has been reaped several times over in efficiencies of being able to talk while I am going down the hall to retrieve files, etc., and the beauty is, I didn't have to cost-justify a thing...I just bought it.  Likewise for the 24" flat screen TV (less than $200) in the corner of my office with the CNBC ticker running all day long.  I don't think there is anything I could have said to my old employer to get such a thing in my office...they would have been scared to death that I might waste a few of their precious minutes during the work week.  Now, when clients call in and want to know what is going on, I can quickly tell them without spending all day glued to the tube.  The benefits of appearing on top of things is hard to measure, but valuable...I'm convinced of that.
...and yes, BEF is correct that for the most part, we aren't really trapped.  At the same time, while I wasn't trapped in the end, I felt trapped while I worked there, and it was only through much effort, money and perseverance that I was able to make the jump.  It is also my understanding that my former employer made several moves after I and others left to make it much more difficult to make the jump, so if I felt trapped then, I'm confident that those who stayed feel doubly trapped now.
At the same time, indy is absolutely not for everyone. 7 makes some great points (especially for a rook ) about survival and the need for experience.  In addition, being a do-it-yourselfer plays a big part in you success as an indy.  I'm also a CPA, so I take care of my own payroll, file my own corporate tax return, etc.  Much of what would otherwise be fairly costly (especially in the beginning) was done at no cost, other than my time.  Office administration is not difficult fo me, but if you are a natural salesman, and admin is not your strong suit, you may not be well-suited to make the transition to indy, unless your practice is large enough out of the gate to hire someone to take care of all the admin stuff.  For many folks in the biz, the support is worth the cost in lost payout.  With what I can do (and did do in the bank setting) fo myself, a 40% (or even 50%) payout seems like a rip-off.
For me, ther's no question I'm happier, but that doesn't mean that everyone would be.  It would be interesting to hear from someone who went indy and regretted it...surely those folks exist also?!!Exactly!  I should have read your post first!

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joedabrkr wrote:
No fool, you are wrong.  But I rather suspect you are a firmly entrenched member of the professional wirehouse bureauracracy, so I would expect your answer to be as such.  You're living off the teats of the organization, so you defend it.Our compliance department is far more progressive and business oriented than the one I faced at UBS.  Yet, they are not foolish.  Too, I have my 24 and am fully aware of my responsibilities, rather than being 'lectured' by an overpaid political hack such as a wirehouse branch manager.Yes many of those in supervision in the wires were once in production.  Very few of them were successful in production, however, or they never would have gone into management.  Rather, they were surviving but mediocre, and picked as being 'good potential management material'.  (See my references above to 'political hacks'.  Add a dose of paper shuffling and 'mouthpiece for upper management' and you get the picture.)Difficult to spend money?  Yep.  You bet.  Especially if your branch manager is trying to hit is profit goal in the last quarter so he can get his bonus and buy a new S-class Mercedes or refinish his kitchen.  Especially if you have a marketing idea that creeps even slightly outside the box.  The wirehouse environment is one that prizes conformity.No nobody is trapped, but it wasn't easy.  It took over a year of planning, working nights and weekends, while putting on my 'game face' and going to the office and acting like everything was hunky dory.  It was sorta like living in a spy movie.  But, in the end it was worth every bit of it!
Joe, the world is filled with whiners like you. "I coulda done a better job as manager, but they didn't offer it to me" is so common that there are entire books written about it.
The ranks of the Independent channel are filled, absolutely teeming, with men and women who want to run a shop and were not given the chance, so they run their own shop.  I honor that attitude.
But don't deny reality and don't sneer at those who were afforded the opportunity at UBS.  We can't all be given a branch to run, and being your own office is a great alternative.
As for your whining about how long it took to become independent, how much planning you had to do, how hard you had to work.
Somehow I get the image of a lazy broker who was unable to earn enough at UBS so he broke away because of the siren song of a higher payout, only to find that they're actually too lazy to make a living in this business period.
Ever seen statistics on how many ex-wirehouse brokers who left for the Independent channel ended up leaving the business as their next step?
When you're not making it at 37% payout the idea that you would make it at 80% is certainly appealling.  But serious thought needs to be given to the realities of why your gross is not very high in the first place.

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Big Easy Flood wrote:joedabrkr wrote:
No fool, you are wrong.  But I rather suspect you are a firmly entrenched member of the professional wirehouse bureauracracy, so I would expect your answer to be as such.  You're living off the teats of the organization, so you defend it.Our compliance department is far more progressive and business oriented than the one I faced at UBS.  Yet, they are not foolish.  Too, I have my 24 and am fully aware of my responsibilities, rather than being 'lectured' by an overpaid political hack such as a wirehouse branch manager.Yes many of those in supervision in the wires were once in production.  Very few of them were successful in production, however, or they never would have gone into management.  Rather, they were surviving but mediocre, and picked as being 'good potential management material'.  (See my references above to 'political hacks'.  Add a dose of paper shuffling and 'mouthpiece for upper management' and you get the picture.)Difficult to spend money?  Yep.  You bet.  Especially if your branch manager is trying to hit is profit goal in the last quarter so he can get his bonus and buy a new S-class Mercedes or refinish his kitchen.  Especially if you have a marketing idea that creeps even slightly outside the box.  The wirehouse environment is one that prizes conformity.No nobody is trapped, but it wasn't easy.  It took over a year of planning, working nights and weekends, while putting on my 'game face' and going to the office and acting like everything was hunky dory.  It was sorta like living in a spy movie.  But, in the end it was worth every bit of it!
Joe, the world is filled with whiners like you. "I coulda done a better job as manager, but they didn't offer it to me" is so common that there are entire books written about it.When exactly was I whining?  I never claimed I could do a better job as a branch manager.  Too much b.s. for my taste.  Early in my career I was once asked if I was interested in learning more about management training.  I politely declinced and went back to my clients.Maybe you could post a link to the Amazon pages for some of those books?  Or were they all written in your head? Not everyone is jealous of your Senior V.P. of Paperclip Procurement sinecure.The ranks of the Independent channel are filled, absolutely teeming, with men and women who want to run a shop and were not given the chance, so they run their own shop.  I honor that attitude.You're getting closer.  That's what I sought, to run my own business without interference of political hacks and marketing V.P's.
But don't deny reality and don't sneer at those who were afforded the opportunity at UBS.  We can't all be given a branch to run, and being your own office is a great alternative.
As for your whining about how long it took to become independent, how much planning you had to do, how hard you had to work.Left again with nothing intelligent to say, you once again accuse me of whining.  I gather this is a frequent dilemma for you, and thus a frequently used tactic. In keeping with the discussion on this thread, I was merely pointing out that going indy was no walk in the park...it was a challenge that required hard work and forethought to overcome.  So how is that whining?
Somehow I get the image of a lazy broker who was unable to earn enough at UBS so he broke away because of the siren song of a higher payout, only to find that they're actually too lazy to make a living in this business period.Ok so now not only am I a whiner, but I'm also lazy?  Then why would I have done all the work to set up my own shop?  OH that's right I'm looking for 'the easy way out'.  You crack me up. 
Ever seen statistics on how many ex-wirehouse brokers who left for the Independent channel ended up leaving the business as their next step?
When you're not making it at 37% payout the idea that you would make it at 80% is certainly appealling.  But serious thought needs to be given to the realities of why your gross is not very high in the first place.And how do you know how high or low my gross is?

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