what do I need?

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theironhorse's picture
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Joined: 2007-03-03

Having just gone independent within the last 2 months I am running into SO many choices for technology, and frankly, do NOT want to be spending $500/month on them.  I am wondering which planning and and "extra" software you guys/gals find very necessary, and which you find to be a waste of dough.  I have looked at NaviPlan, MoneyGuide Pro, LaserApp, Investigo, Principia Pro, X-Ray, yada yada yada.  Give me some thoughts please.

troll's picture
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Joined: 2004-11-29

I can't live without Laserapp.  I use a legal pad for presentations. That's all.

roostertale's picture
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I use a legal pad for presentations. That's all.
Me too. Maybe we're both really smart, or lazy, or both.

troll's picture
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roostertale wrote:
I use a legal pad for presentations. That's all.
Me too. Maybe we're both really smart, or lazy, or both.

We both know that it works best. Less is "more" in this business. I just "doodle" what I'm saying on the pad. When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.

roostertale's picture
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Joined: 2007-07-28

When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.
You crack me up. I always keep the yellow pad notes, with their important pie squiggles and action notes (like, " invest 100% in OMSOX" ).
I'll just have to try wadding it up some time, for dramatic effect.

theironhorse's picture
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thanks.  I use the simple route as well with a yellow legal pad.  But what about for aggregating accounts, annual reviews, etc.  I use a legal pad for "initial sales" but am thinking about semi-annual and annual reviews.  Plus simply keeping track of it all.thanks again.

blarmston's picture
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Joined: 2005-02-26

Not sure how expensive it is, but Zephyr is the best asset allocation and investment planning tool out there, IMHO.

pretzelhead's picture
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Bobby Hull wrote:
We both know that it works best. Less is "more" in this business. I just "doodle" what I'm saying on the pad. When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.

You don't use the illustrations that the annuity cos provide? 

Ashland's picture
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Joined: 2007-03-07

I've developed my own questionnaire because all of the firm provided stuff is crap and I always miss stuff using a pad. I use Principia w/ the vast majority of my clients. If I have a really analytical person I'll put a Thomson Financial investment profile in front of them. For financial planning the firm provides me w/ Sunguard which isn't the best or worst in the world. For the $200K - $2MM it's just the right amount of detail.

IMHO client's don't care what we use as long as we're comfortable with it, and can show that we approach investment and life planning with a specific process in mind.

troll's picture
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pretzelhead wrote:Bobby Hull wrote:
We both know that it works best. Less is "more" in this business. I just "doodle" what I'm saying on the pad. When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.

You don't use the illustrations that the annuity cos provide? 

Nope. Less is more.

Ashland's picture
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Bobby Hull wrote: pretzelhead wrote:Bobby Hull wrote:
We both know that it works best. Less is "more" in this business. I just "doodle" what I'm saying on the pad. When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.

You don't use the illustrations that the annuity cos provide? 

Nope. Less is more.

Great idea! If I didn't use illustrations I could promise my client any kind of return I wanted to, too!

I can just see it now. Bobby's combover waving in the wind, "My clients did 21% per year on average for the last 10 yrs after the 3% of fees for the VA (unsaid but thought by the client) and the next 10 yrs will be exactly the same way!"

troll's picture
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Ashland wrote: Bobby Hull wrote: pretzelhead wrote:Bobby Hull wrote:
We both know that it works best. Less is "more" in this business. I just "doodle" what I'm saying on the pad. When I've answered all of their questions, I tear it off, wad it up, and throw it away. It signals a very clear end to the selling. The only thing left is the paperwork.

You don't use the illustrations that the annuity cos provide? 

Nope. Less is more.
Great idea! If I didn't use illustrations I could promise my client any kind of return I wanted to, too! I can just see it now. Bobby's combover waving in the wind, "My clients did 21% per year on average for the last 10 yrs after the 3% of fees for the VA (unsaid but thought by the client) and the next 10 yrs will be exactly the same way!"
It's unfortunate that you have to use illustrations to keep yourself from lying to people. Most of us don't lie because the thought doesn't cross our minds. Get well, soon.

Ashland's picture
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Joined: 2007-03-07

Poor Bobby... must've been tough being picked on all the time as a kid. Couldn't see the blackboard from the back of the room so you had to sit up front. It's alright, Bobby.

What the illustration really shows is:

US Stocks generally do 10%
Int'l Stocks            12%
Bonds:                   5%

50% US Stocks =      5% Return
20% Int'l Stocks = 2.5%
30% Bonds =        1.5%
-----------------------
Total Return =       9%

Less VA & Rdr Cost -1.6 - 2.5%
Less Mgmt Cost      -1%

Returns less costs = 6-7%

Yes, the income bucket does better than this return because of rider step-ups etc(and that's why we use VA's for client), but overpromising is dangerous and irresponsible.

Like you, Bobby. Dangerous & irresponsible.    

troll's picture
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Ashland wrote:Poor Bobby... must've been tough being picked on all the time as a kid. Couldn't see the blackboard from the back of the room so you had to sit up front. It's alright, Bobby. What the illustration really shows is: US Stocks generally do 10% Int'l Stocks            12% Bonds:                   5% 50% US Stocks =      5% Return 20% Int'l Stocks = 2.5% 30% Bonds =        1.5% ----------------------- Total Return =       9% Less VA & Rdr Cost -1.6 - 2.5% Less Mgmt Cost      -1% Returns less costs = 6-7% Yes, the income bucket does better than this return because of rider step-ups etc(and that's why we use VA's for client), but overpromising is dangerous and irresponsible. Like you, Bobby. Dangerous & irresponsible.    
Why would I show them THAT? How does that get the account? Can't I just tell them the truth? When I show them actual results and some moron shows them something that has earned less than half of what I've done, it's all over. Are you really that stupid?

anonymous's picture
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Joined: 2005-09-29

Ashland,
I think that it's irresponsible to use an illustration in selling an annuity.  Based upon that illustration, shouldn't the client be 100% international?  If you could, would you use an illustration to sell a mutual fund?  It just makes no sense.  We have no clue about future returns.
When you show an illustration, the client will expect illustration-like returns.   Do you really want your client to expect to get 12% on his international money?  (He may get it, but you don't want him to expect it.)

Ashland's picture
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Anon -

Wow - I'm surprised. I do use illustrations to show people historical returns of funds - I use Morningstar Principia.

This shows people upside & downside & is much more complete than average annual returns. You do quote average annual's(even if they're just on benchmarks), don't you? Don't you think it's important for your moderate client to know that a bad quarter might be down 12% - 15% after fees, or that your aggressive client may see a year down 25% & a 3 yr period down 40 - 50% if no adjustments are made.

With VA's I think this is doubly important because of the benefits that riders provide. It's also a CYA because it shows the effects of costs & how the riders really work. With VA's I typically illustrate worst case scenarios(starting in 1999) because that's what our fear is - that's why we're buying the VA - the case of bad returns at the beginning of their retirement.

So, what you call irresponsible, I call being complete & covering my rear.

Bobby doesn't use illustrations because he uses UIT's w/n his VA that have had 20%+ returns over the past 10 & 20 yr periods. He can simply quote these past performance #'s & tell his clients that the cost of the VA is paid for by deferring the taxation of the UIT's. I think that's misleading.

troll's picture
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Ashland wrote:Anon - Wow - I'm surprised. I do use illustrations to show people historical returns of funds - I use Morningstar Principia. This shows people upside & downside & is much more complete than average annual returns. You do quote average annual's(even if they're just on benchmarks), don't you? Don't you think it's important for your moderate client to know that a bad quarter might be down 12% - 15% after fees, or that your aggressive client may see a year down 25% & a 3 yr period down 40 - 50% if no adjustments are made. With VA's I think this is doubly important because of the benefits that riders provide. It's also a CYA because it shows the effects of costs & how the riders really work. With VA's I typically illustrate worst case scenarios(starting in 1999) because that's what our fear is - that's why we're buying the VA - the case of bad returns at the beginning of their retirement. So, what you call irresponsible, I call being complete & covering my rear. Bobby doesn't use illustrations because he uses UIT's w/n his VA that have had 20%+ returns over the past 10 & 20 yr periods. He can simply quote these past performance #'s & tell his clients that the cost of the VA is paid for by deferring the taxation of the UIT's. I think that's misleading.
Little girl, the only number I quote are real numbers. I can back up my claims with actual client statements. That's all it takes, sweetheart. All I have to do is tape a statement to the back of a dog....

bluestars80's picture
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Bobby Hull wrote:
Bobby doesn't use illustrations because he uses UIT's w/n his VA that have had 20%+ returns over the past 10 & 20 yr periods. He can simply quote these past performance #'s & tell his clients that the cost of the VA is paid for by deferring the taxation of the UIT's. I think that's misleading.

anonymous's picture
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Ashland, I don't quote average annual return.  It's meaningless and dangerous if it is a big #.  Let's use for example Growth Fund of America since it is the biggest (?). 
It has a lifetime return including maximum sales charges of over 15%.   No matter what you say to a client, they will expect those types of returns if you show them.  I want my clients to plan based upon an expectation of 6-7%.  I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.   The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.  The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.

Ashland's picture
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anonymous wrote: Ashland, I don't quote average annual return.  It's meaningless and dangerous if it is a big #.  Let's use for example Growth Fund of America since it is the biggest (?). 
It has a lifetime return including maximum sales charges of over 15%.   No matter what you say to a client, they will expect those types of returns if you show them.  I want my clients to plan based upon an expectation of 6-7%.  I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.   The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.  The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.

Where was the disagreement we were having again? How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?

troll's picture
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Ashland wrote: anonymous wrote:
Ashland, I don't quote average annual return.  It's meaningless and dangerous if it is a big #.  Let's use for example Growth Fund of America since it is the biggest (?). 
It has a lifetime return including maximum sales charges of over 15%.   No matter what you say to a client, they will expect those types of returns if you show them.  I want my clients to plan based upon an expectation of 6-7%.  I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.   The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.  The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.
Where was the disagreement we were having again? How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?
Hey Homo: Don't you have the guts to address my response to you about using actual numbers? Or did it shut your stupid smegma coated mouth?

Ashland's picture
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Bobby Hull wrote: Ashland wrote: anonymous wrote:
Ashland, I don't quote average annual return.  It's meaningless and dangerous if it is a big #.  Let's use for example Growth Fund of America since it is the biggest (?). 
It has a lifetime return including maximum sales charges of over 15%.   No matter what you say to a client, they will expect those types of returns if you show them.  I want my clients to plan based upon an expectation of 6-7%.  I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.   The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.  The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.
Where was the disagreement we were having again? How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?
Hey Homo: Don't you have the guts to address my response to you about using actual numbers? Or did it shut your stupid smegma coated mouth?

This homosapien doesn't swing at pitches in the dirt. Nice throw tho... The ball only landed 100 feet from the plate this time. Got the glasses fixed, eh?

troll's picture
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Ashland wrote: Bobby Hull wrote: Ashland wrote: anonymous wrote:
Ashland, I don't quote average annual return.  It's meaningless and dangerous if it is a big #.  Let's use for example Growth Fund of America since it is the biggest (?). 
It has a lifetime return including maximum sales charges of over 15%.   No matter what you say to a client, they will expect those types of returns if you show them.  I want my clients to plan based upon an expectation of 6-7%.  I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.   The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.  The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.
Where was the disagreement we were having again? How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?
Hey Homo: Don't you have the guts to address my response to you about using actual numbers? Or did it shut your stupid smegma coated mouth?
This homosapien doesn't swing at pitches in the dirt. Nice throw tho... The ball only landed 100 feet from the plate this time. Got the glasses fixed, eh?
You have a knack for dodging the truty like a liberal democrap.

anonymous's picture
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How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?
My selling style may be different than lots of people, especially those at wirehouses.  I very rarely make recommendations about what to buy before the prospect becomes a client. 
I take factfinders.  It is typical for me to leave the factfinder with the following agreements:
1)Apply for $X of life insurance2)Apply for as much DI coverage as the company will issue3)Rollover the old retirement accounts (401(k), IRA, etc)4)ACAT other investments5)Put $Y a month away to accompish goals A,B,C,D,E
"Ok, Mr. Client, my assistant will call you to take care of the insurance applications and set up the new accounts.  It will take a good 4-8 weeks to get everything approved.  In the mean time we will transfer your assets, but won't make any investment changes.  We won't get back together until after the policies get approved.  At that time, we will work together to put together the investments that make the most sense for you along with developing a plan for how best to put away your $Y a month to accomplish goals A,B,C,D,E."
The decision to do business with me is very rarely contingent on the investment recommendations.

companyman's picture
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3 pages and very little info.  But seriously, what systems have you all used for contact management, portfolio reviews, and the like?  Pro's and con's welcome.

brandnewadvisor's picture
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companyman wrote:
3 pages and very little info.  But seriously, what systems have you all used for contact management, portfolio reviews, and the like?  Pro's and con's welcome.
 
I think when this post started someone said they don't want to be spending $500/month?  If you go independent - you'll likely be spending that per week.  Here's what I use in my practice:
 
CRM - used to use ACT! - but it wasn't real expandable as my business grew.  If you think you'll ever have multiple offices or subadvisors I would suggest something web-based.  www.salesforce.com has one ($40/mo. or so); or do as I did, a Microsoft Exchange Server with Outlook for Web 2007.  It's every bit as exapandable and capable as ACT, but also can store document for remote access, automated backup and compliance review of staff email (essential for RIA firms).  I also picked up a Windows Smartphone that automatically synchs with the calender, etc.  Cost - $3,500 one time for software and installation.
 
Portfolio Accounting/billing/reporting - You can go on the cheap and use Investigo or IAS software, but they will require 5-10 hours per week of administration and still run a couple hundo a month.  I use Albridge Wealth Reporting, which if you are part of a b/d firm you can probably get for $200-400/month.  If you have an RIA it'll run 4 basis points per year on AUM with a minimum annual cost of $25,000.  This is completely automated, makes killer reports and keeps you highly compliant with performance reporting, billing, trade blotters and about a half dozen other reports the SEC may ask for in their routine audits.  I swear by it and it's worth every penny.  If you can't answer these two questions at every review meeting, eventually your clients will go elsewhere for the answers:


  1. How much do I have? (especially important if they have 4 or more accounts and possibly multiple custodians and reporting periods)

  2. How am I doing? (what's the performance, asset allocation and can you show them iron clad proof your fees are justified)

 
Investment Analysis - Morningstar Advisor Workstation is what I use.  Theirs cheaper versions, but the workstation is web-based and has all the modules including variable life/annuities and SMA's.  I think I pay around $2,500 per year for this and it's helped close many a large client over the years.
 
Financial Plans - I don't do a lot of these, so I've only used a few programs.  Currently I use IncomeMax from Cygnus software.  It's easy, affordable and delivers for about $400/year.
 
Other essentials for the newly indepenent are:

  1. A credible website with private e-mail (I never take anyone seriously who used hotmail, yahoo, gmail, etc.)

  2. A staff of at least one.  I've taken a few very large accounts on the basis of comfort knowing I have more employess.  They pay for themselves and make an occupation an actual business

  3. An office that has more than one room and is not in your house

All told, this stuff will run about $150,000 per year for someone with a $50 million book and at least one full time employee; a bit more than $500/mo.

brandnewadvisor's picture
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too much beer = a great deal of typos - sorry bot thems

troll's picture
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Ashland wrote: anonymous wrote: Ashland, I don't quote average annual return.� It's meaningless and dangerous if it is a big #.� Let's use for example Growth Fund of America since it is the biggest (?).�
It has a lifetime return including maximum sales charges of over 15%.�� No matter what you say to a client, they will expect those types of returns if you show them.� I want my clients to plan based upon an expectation of 6-7%.� I do promise all of my clients that we will have years in which they will lose money and that these losses at some point will be significant.�� The clients who can't stomach the down markets either get more conservative investments or VA's with guarantees.� The guarantees stop them from moving out of equities when the market goes down.
Showing actual high returns makes selling easy, but it makes planning more difficult and it makes managing expectations difficult.

Where was the disagreement we were having again? How do you define for a customer how they will benefit from putting their money in the investments you recommend? How do you describe the trade-offs?Anon-you are being very responsible in managing expectations.Do you see that there's a discrepancy between the (ethical) way you operate and BH's "tape a note to a dog and show them client statements(with names blacked out)" modus operandi?Look closely......it's right there in this thread....

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