I miss EDJ...

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westy's picture
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Joined: 2004-12-21

NOT!!!!!!!
I've been gone for over 3 years....best thing I ever did....independent and luvin' it!
How ya been Zacko?????
 

munytalks's picture
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Joined: 2006-04-17

Pend/32 FSPEND/12
There! Feel better now?

westy's picture
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Joined: 2004-12-21

ahhhhhhh....that's better...thanks

Devoted SA's picture
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Joined: 2006-03-28

Wow, that's funny. Let's see if we can organize a PM Promo...We've got some pretty nice Jones picture frames we can give out as prizes.

munytalks's picture
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Joined: 2006-04-17

Seriously though, man, I really miss Summer Regionals. I miss getting together with my fellow IR's , learning about new products like... uh, well, getting together anyway.
And I miss those Elmer Fudd cartoons they used play at the beginning of the Regional Meeting. Oh wait, those were Doug Hill videos. Hey, is it just me or does he sound like Elmer Fudd to you?
"People, we have pwoblem. We must gwow. If we don't gwow, we die. Gwowf. Gwowf. Gwowf. That must be ouw mantwa."

gew21's picture
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Joined: 2006-05-01

I couldn't help but to find humor in everyone of those posts.  In the first post I ever made, I mentioned I was actually split down the middle w/ Jones, and when it comes to the things mentioned previously, well, I agree.  Never hated it like all of you, but your all right about everything listed above.  Was it all that bad though???  Few FSPENDS?? Hell, you didn't have to go to PM Promo's.  I had buddies @ the Reg Metting's, we just clowned on everyone that drank the kool aid.  You can still make it as a Jones IR and not drink the aid, but I bet there are a few of you that will clown on this post, so feel free and fire away.  Don't think you scared me off, I will be out of town @ weddings all weekend, but I will be ready for all the kind words when I return. 
Have a nice weekend fellas, look forward to chatting again next week.
"Yes, MR IR, I know you just asked a perfectly simple question, but I am going to need you to go ahead and send a wire to #__  and we will get back to you in about a week" 
I don't miss that s*$t

Gone Indy's picture
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Joined: 2005-12-02

"And I miss those Elmer Fudd cartoons they used play at the beginning of the Regional Meeting. Oh wait, those were Doug Hill videos. Hey, is it just me or does he sound like Elmer Fudd to you?"
I personally think the biggest cartoon character of the GPs was Fes Shaughnessey (SP?).  What a goofy dude he is! 
 

Devoted SA's picture
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Joined: 2006-03-28

Yeah...he was a little weird looking. Big drippy earlobes and weird nose. But what about Alan Skrainka? With that big egg head?
Seriously, had a client who had HUGE crush on Alan Skrainka and was two steps away from being a stalker!

success's picture
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Joined: 2005-02-01

Been with JOnes 7 years and love it.  Do I love ALL parts?  No.  Never have, never will.  BUT, last year I grossed $517,000 which netted me about $196,460.  I also got $42,000 in bonuses and 10,730 in profit sharing.  So, $249,190/$517,000, I had a 48% payout on cash items.  I didnt figure in things like trips because you clowns some how dont value them at all.  I agree you can go on your own trip with your family.  Remember, you will  NEVER spend $600-$1,000/ night on a plush hotel.  Dont say you will.  So, I will take a 48% payout and deal with email restrictions, field supervision and A-share annuities.  No problem.  I dont care how much Weddle makes.  Thats like working and BAC and worrying that their CEO made a gazillion dollars.  who cares.  SO, you are your 90% payout is fiine, but at the end of the day, you get to keep what 60%.  I'm not leaving for an extra 12% payout.  Yep, leave it on the table.  I was actually thinking about all this as I was laying in the infinity pool in Italy. 

zacko's picture
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Joined: 2004-12-01

I miss the sexual harrassment and inclusion videos myself...
Success--back out your office overhead which comes out of your net...and I assume your assuming 1% of net from Jones advertising?  And, that's in an extremely high bonus bracket enviornment.
Also, you are losing tax deductions as well being an employee.  Your first 2% off your AGI doesn't count. 
Trailing 12, I grossed about 730k netted about 590k and had about 120k of office overhead (did alot of advertising --but cutting back so I should be lower on overhead going forward) which brings me to 470k net.  Thats about a 65% net/net.  I also get mega tax benefits and own my own business.  I put 60k into a safeharbor plan last year for the wife and I (yes, she is listed as an employee).  17% better net/net than Jones--NOT counting overhead at Jones?  So, the real difference is closer to 20% on payout.  On 700k of gross--that's 140k more I take home than I would have at Jones.  My trails and fee business will generate over 300k gross this year and probably get close to 400k next year.
Almost 12k per month difference and your still like a hamster on a wheel generating trade after trade to get paid.  nothing wrong with that.  I congratulate you on your achievements.  But, you don''t have it near as good as you think you do.
(ps also got 1000 free stock options--presplit from RJ last year)
 
 

footsoldier's picture
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Joined: 2006-04-30

Success-
How big an office did you inherit? Very few have done it from scratch to the numbers you describe. What is the rest of the story? Cmon tell us.

zacko's picture
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Joined: 2004-12-01

More have built offices from scratch than you think...

successroom1's picture
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Joined: 2006-05-02

Success
You are the "ultimate employee" for Jones. You will always be an employee...yes you do make some money but what are you going to do at the end of the road? Give it all away to some GP's punk nephew. Get the hell out of there while you still can and become an owner, the rewards are bigger on the indy side. Oh and BTW did I mention there is email on the indy side.
Run baby Run!!!!!!!

footsoldier's picture
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Joined: 2006-04-30

Hey Success-
 
48% is reduced by at least 3-4% for expenses not covered by Jones. Zacko is right on again. My point regarding the 512K in 7 years. Firm average is .70 so assets would be around 74M, an average of 10.5M per year. That would be quite a story. Maybe some of have seen that, in my region I can't think of anyone.

Bill Fakkland's picture
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Joined: 2005-01-18

I built my office from scratch and my numbers are in the range mentioned, but about 5% lower. The difference is, I'm out under 5 years. I actually like the trips a lot...honest.

zacko's picture
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Joined: 2004-12-01

In 5 years I was over 500k also.  I got about a 1% turn on my assets until I got to 50-60 million.  Now, it's abut .70 or maybe even a little less.  If I ran a Jones style business--I would have been able to do a million last year.  But, when your putting new $$ in wrap accounts, it slows you way down on the production.  I'm not complaining as it's all part of my long term business plan.
I liked the trips too for a bout 5-6 years.  After that, wife and I always did our own thing and blew off the Jones dinners.  Took cash on alot of them too in favor of going on my own vacation.
The RJ indy trips (gotta do 700k to go) are nicer and more lavish--but the Jones trips weren't that bad.  I did some stuff I wouldn't have ever done.  RJ's 1099 on my nevis trip last year was 8k so I gotta pay taxes too. 
 

The Truth's picture
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Joined: 2004-12-01

What will Jones reaction be once revenue sharing is gone as we know it
today?

doberman's picture
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Joined: 2005-02-22

The Truth: What will Jones reaction be once revenue sharing is gone as we know it today?
--------------------------------------------- 
Correct me if I'm wrong, but the primary problem with revenue sharing is the fact that it wasn't disclosed to the client. The practice is not illegal per se, unlike it's nondisclosure. So, I don't think it will be eliminated.
However, if it was eliminated, who do you think would bear the brunt of the loss of a major source of revenue? You score 100 points if you said, "The broker's payout".

success's picture
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Joined: 2005-02-01

zacko has some good points concerning taxes.  you are also right that i am limited on my retirement savings (401k).  Dont get me wrong, i think independent absolutely has its benefits.  however, if there were no downside, no one would work for anyone else.
 
I started from scratch.  I received 0 accounts from anyone.  no family money either.  i worked 70 hrs week the first year and opened 395 accts.  a wife and 2 kids later, i work about 30 and having fun.

zacko's picture
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Joined: 2004-12-01

Success,
Some people just don't want to have their own businesses.  They would rather not have the additional responsibility and liability.  I spend about 2-3 hours per month doing payroll, paying bills...etc.  As an indy, you pay your also pay your own E&O.  I also think most brokers who know about indy--who don't go are afraid.  They are scared they might be wrong in leaving their current firm...after all if it sounds too good to be true, it probably is.
At Jones--it's sort of like your half way there already.  In fact, to most clients--the perception of being indy or being at Jones is the same.  They see you as being in a one man office.  Of course, I could hire brokers now if I wanted and get an override.  I've chosen not to for now. 
 

success's picture
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Joined: 2005-02-01

zacko,
thanks for the conversation.  its nice to actually read a post that doesnt bash JOnes or any other firm for that matter.

Player's picture
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Joined: 2004-12-08

Zacko, you nailed it............................
What price is there for real FREEDOM.........MONEY and a lot more of it!

csmelnix's picture
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Joined: 2005-06-01

The biggest benefit and Zacko I think you really outlined it is the fact when you are indy and OWN your own business - you control your margins!!!!  You actually get to determine what and where you spend and how much of it you spend.  Look at your gross after paying the costs to do biz at your indy shop - it's probably a 83-85% payout:  from there, you are making the choices on how to best spend the money and as a result can determine what your net will be.  More importantly, you control spending that money in areas that directly affect your business locally v having a GP or whoever else determining how to best spend it for you. 
 Imagine a million dollar producer who nets 40% and Jones or whereever else - the b/d determines how to best spend the $600k they took from you.  Take that indy million dollar producer who is seeing $850k hit his/her grid and determining where they are going to spend their dollars to affect their business.  Now they net $600k or better.   They took $250 k and spent it where it helps their business as they determine. 
Now ask:  What did you get for the $600k jones took from you?  A BOA, an office, a trip or two, 1/2 expenses paid on the office and a few other things like????   Compare that to the $250k the indy owner spent.   They're getting probably 2 - 3 admin assistants, marketing targeted specifically to their ideal client, a level of local service due to the support staff they have that their clients never felt before and etc....  Point being, with the $250 k I spend as an indy - at a minimum I am giving/getting the same that it costs the jones advisor but for $450k less.  I control it, I know where it'll benefit me and my business and in the end receive a much greater level of benefit as a result of it.
 

success's picture
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Joined: 2005-02-01

does anyone know how the independents in Louisiana are doing? 

skolbrother's picture
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Joined: 2005-07-12

I am certain you have a point success... perhaps you should just state it.

babbling looney's picture
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Joined: 2004-12-02

success wrote:does anyone know how the independents in Louisiana are doing? 

What does that question mean?  Are you trying to say that being and independent is..... oooooh .....scary music.......dangerous?  Of course it is.  When you are in business for yourself (any business), you'd better be ready to go up against the wall, go all out and put everything on the line.
I would imagine that they experienced some difficulties with accounts transferring out, if their clients have moved away and do not intend to come back.  Possibly they had some damage to their buildings if they were in the area that was affected. I expect they were insured.
You do realize that all of Louisiana didn't get wiped off of the map and that the investments that the reps are managing are nice and snug somewhere else?  Living in the path of known dangers such as hurricanes, tornadoes or on top of earthquake faults is just one risk that people take.  Most of us plan for the eventuality of that risk and don't expect someone else to pick up the pieces for us.  That is also the difference between being an Independent and being somebodies employee.

BrokerRecruit's picture
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Joined: 2005-04-19

success - they're doing ok, for the most part.  I think that there are select groups that were impacted more than others.  I know a group of five really well and they have had to move offices 4-5 times since Katrina hit, but are settled now.
I know some reps were initially hit when clients had to withdraw some money to handle repairs, build new homes, move, etc., and this caused them to take a small hit in production initally, but they have rebounded since then. 

footsoldier's picture
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Joined: 2006-04-30

Just saw a response from Weddle on the suggestion box responding to the question, "should we as IR's be concerned that over half of the firm net revenue is  from revenue sharing." The questioner went on to ask," Will Edward Jones go out of business if revenue sharing practices are banned completely."
His first response was "It sounds like you have been talking to a recruiter from another firm." I was amazed he did not respond in the usual form, That's a great question, I am glad you asked.
Question for BrokerReucruit-
Should we be concerned? Is there a move a foot to ban the practice?Or is this as Weddle suggests a scare tactic? 

success's picture
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Joined: 2005-02-01

No, I am not scared.  I am very confident in my ability and what firm I work for.  Yep, thats right. I work for somene.  We all do, you just may not reallize it yet.  I have never and will never say Jones is perfect, but it sure beats working for a wirehouse.  Now, the independent thing has merit.  You own your business, but I am not sure I have ever heard of being able to retire on selling my book.  But lets say you are banking on selling your book to help with your retirement nest egg.  How much do you have to sell your book for it to provide, say, 30k-40k a year?  600k?, 700K ?  Who in their right mind will pay you that?
 
As for revenue sharing.  Its like a statistic.  you can create whatever answer you want when asked what impact it will have on JOnes.  Bottom line, it would reduce overall revenue by that amount. Simple.  Not half, not a third.  maybe 4%. 
Whether you convince your client to buy an A share or you choose to put everytihing in managed money, at the end of the day its what you think is best for your client.

troll's picture
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Joined: 2004-11-29

success wrote:
  I have never and will never say Jones is perfect, but it sure beats working for a wirehouse. 
 

zacko's picture
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Joined: 2004-12-01

I don't think rev sharing will be banned.  Jones would certainly be affected if they eliminated it.  In fact, more than just about any firm they would be hurt.  IR compensation would be reduced with certainty.  So would bonuses.
Weddle brings up a recruiter?  That's too funny.  I'd imagine that Weddle and others have to deal with the fact of ongoing departures.  It must be on his mind.  Especially with the long weekend coming up.
 

footsoldier's picture
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Joined: 2006-04-30

Success-
Read the disclosures. 220M out of a net of 300M came from revenue sharing. I count insurance revenue sharing as well.  Where does your calculator come out to 4%.
Not suprised. Most IR's are big picture reps.

exEJIR's picture
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Joined: 2005-05-12

success wrote:
You own your business, but I am not sure I have ever heard of being able to retire on selling my book.  But lets say you are banking on selling your book to help with your retirement nest egg.  How much do you have to sell your book for it to provide, say, 30k-40k a year?  600k?, 700K ?  Who in their right mind will pay you that?

Wow, the kool-aid must have really gone to your head. 
Go to this website and see what your biz would be worth,... www.fptransitions.com

success's picture
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Joined: 2005-02-01

footsoldier,
Total gross revenue of 3.1 billion would.  Take away $220M, whats your total revenue now?  2,880,000.  Will it have an impact, sure.  If the NASD ever decides to look into wrap account, i bet you income drops in half and if they crack down on variable annuities, you're done.

babbling looney's picture
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Joined: 2004-12-02

success wrote:
footsoldier,
Total gross revenue of 3.1 billion would.  Take away $220M, whats your total revenue now?  2,880,000.  Will it have an impact, sure.  If the NASD ever decides to look into wrap account, i bet you income drops in half and if they crack down on variable annuities, you're done.

It never fails. At some point in a discussion about the different business practices of Indy Vs Jones the Jones reps get the same snotty holier than thou attitude.  Its the same feeling you get when you are talking to your know-it-all teenager.  You just know that they will have to learn the hard way.  Sigh.

footsoldier's picture
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Joined: 2006-04-30

Success-
Gross revenue minus expenses = 300M. That is called net profit to partners. If rev sharing reprents 220M which is 95% net to the GP's your numbers are bullsh*t.
Perhaps in a way you can understand. It is not how much you make, it is how much the GP's keep. That's why rev sharing is so important to our firm.

success's picture
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Joined: 2005-02-01

its not being a snotty teenager.  its a fact.  my point is not to be sarcastic.  it is sto imply to point out that there are many things that can neg. impact all of our businesses.  revenue sharing for us and wrap fees for you.  those are just 2 examples.  I have no problem with you being indy.  its fine.  i didnt say you drank indy kool aid.  people are so quick to through this kool aid thing out.  maybe i like working for jones.  maybe i dont care if i can sell my book.  i'll give it to my daughter.  maybe i will like drawing 40k a year in LP earnings.  maybe when i am 80, i may regret not going indy.  by then, money wont be able to help me.

babbling looney's picture
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Joined: 2004-12-02

i'll give it to my daughter.

footsoldier's picture
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Joined: 2006-04-30

success-
Did you get your financial planning training yet? How about a calculator? I am sure your destined for greatness at Jones. You could be one of the company leaders someday.
No matter if your indy or working for someone else, you have to do the math at some point. Mr. Gecko said it best. It's all about greed.
If you can understand a 10K, maybe even you would be enlightened.

success's picture
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Joined: 2005-02-01

how about this question mr babble.  what makes you happy?

zacko's picture
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Joined: 2004-12-01

I really won't ever sell my book...why would you?  Bring in a partner, and share in the revenues for the rest of your life...why would you ever "retire?"  What's the point of building a fee based practice (which would otherwise provide you with lifetime income) and selling it?

troll's picture
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Joined: 2004-11-29

success wrote: it is sto imply to point out that there are many things that can neg. impact all of our businesses.  revenue sharing for us and wrap fees for you.  those are just 2 examples. 
Wow, they really do drive that "wrap fee = evil" message in hard, don't they?

success's picture
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Joined: 2005-02-01

Mike,
i didnt say i am against wrap fees.  I think it can be appropriate as long as the fees are not too high.  Wrap accounts give the client more flexibilty.  However, most folks i know do it for the recurring revenue.  There are pros and cons to ever platform out there.  They can all be "evil" if taken advantge of. 
I agree with Zacko.  the arguement about selling your book is non sense.  I think  a better arguement is saving more in a 410k, more deductions, and better product selection. 

footsoldier's picture
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Joined: 2006-04-30

success-
Maybe what you ought to do is become a GP. You have double speak in your blood. "I did not say wrap fee was bad." Go back a few pages and look. Babs was right. The only way to defend is attack.
Have you looked at fees associated with mutual funds (personalfund.com dude, check out transaction costs)? And you are worried about wrap fees. Did you know that your/my firm participated in directed brokerage (a fee was paid to Jones to transact for the funds) until it was banned? Did you know that the GP's had an ownership interest in Hartford mutual funds since 1995, and terminated the relationship with a 70M payment to the GP's along with other income durng the last 10 years? Did you get any of that? I didn't. Are you still paying 1300/ month for the most ridiculous technology on the street. Do you have financial planning software (do you even know how to calculate IRR). Can you communicate with the rest of the known world in an effecient manner. By the way, I have company email but am unable to send attachements.
Oh yeah, the final question. How do you feel about giving the GP's 60% and they only made 60M of the 300M as a result of yours and my efforts? The rest (get your calculator out) came from back door arrangements? So when Weddle is asked the question should we be worried ( and bozos like you say its only 4% of revenues but 60% of net profits) the rest of us just shake our heads and say its not a matter of if but when we choose to change b/d's.
So congrats on your production and enjoy the trips. You'll figure it out someday, maybe.
 

Devoted SA's picture
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Joined: 2006-03-28

footsoldier wrote:
success-
Have you looked at fees associated with mutual funds (personalfund.com dude, check out transaction costs)?

Footsoldier! THANK YOU! I had stumbled upon personalfund.com a while back and couldn't remember what it was called....(duh).
< I'm jumping out of my desk and throwing both arms in the air a'la Mary Catherine Gallagher...You're a SUPAH STAH!>
 

The Truth's picture
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Joined: 2004-12-01

Last year they took 70%. Factor revenue sharing against net income. That
paints a clearer picture. The GPs will never take a lower payout.

footsoldier's picture
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Joined: 2006-04-30

success-
Appears that others have a different calculation than you. (Remember your comments on this thread that rev sharing is only 4%)
Could mean that you'll be taking over for Weddle in a few years. Truth comments in his last sentence above is probably the most powerful words of the day.
 

anonymous's picture
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Joined: 2005-09-29

"I really won't ever sell my book...why would you?  Bring in a partner, and share in the revenues for the rest of your life...why would you ever "retire?"  What's the point of building a fee based practice (which would otherwise provide you with lifetime income) and selling it?"
There are so many reasons to sell a book of business.  In many ways, it should be no different than selling any business.  However the main reason that someone would sell is that sale price is worth more to the seller than the continued stream of income + any potential headaches.   (Clients don't like new person, continuing ed becomes pain in the ass, etc..... and there are LOTS of etc.)

proudlp's picture
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Joined: 2005-01-28

Great accounting work going on in here.  By the logic displayed here you could easily say that Income was 1000% of revenues. 
Read the books more carefully and you will see that RS makes up about 4% of total revenues.  Even if you used power logic...that means that about 4% of income was from revenue sharing.  
I don't think any company wants to lose 4% of income but it is not like revenue sharing makes or breaks Edward Jones as a company.
 

success's picture
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Joined: 2005-02-01

footsoldier,
relax dumb ass.  In an earlier post, I had my cash payout last year at 48%.  Include commission, bonus and profit sharing.  I am fully that bonus is based on my PL statement.  If we assume the avg. bonus bracket is around 30% (sometimes its 0 and somtimes its 50), then 48% is a good number. I am cool with that number.  i dont care how much weddle makes. Maybe someday something will happen at Jones and many more will go indy.  But for right now, if i maintain about 48% payout, great!  And yes I enjoyed Italy at the hotel carusso. 

footsoldier's picture
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Joined: 2006-04-30

success-
You had zero out of pocket expenses (that would be described as money out of your pocket or money deducted from your paycheck)? I average about 16K last year with out of pocket expenses, how do you explain that. And you tell me to relax. I won't bother with your other comment.
Get a grip dude. Just look at real net numbers. That's the point with revenue sharing. Rev Sharing at Jones represents (here comes the calculator again) 73% of net profit.  I concede that 4% of revenues is not that much, but 73% of net profit (to the owners, i.e. general partners) does present a different and potentially changing scenario.
In the context of my earlier responses, when our managing partner was asked what are the potential issues to EDJ if rev sharing was banned, he responded with sarcasm. Actually similar to you.

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