SIX FIGURES??

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Ready2Jump's picture
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OK guys, I've done some reading here and it seems like many of you are $200k+ producers.  I would been happy as an Indy producing $200k, money is not my main focus.  My question is this:
If you are making over six figures in personal income already, what drives you to consider ways to "double your production" or move firms to get a better payout?  Just curious I guess. 

CIBforeveryone's picture
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Joined: 2005-07-12

when you feel like too much of that 200k is going to someone other than yourself. Seriously.
CIBforeveryone

bankrep1's picture
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Joined: 2004-12-02

Ready2jump,
Once you make "six figures", you'll quickly learn you can have a comfortable life (aka you don't need to think about whether you can buy new stuff you just do if you desire to), but your no where close to being wealthy especially if you have a family.  In fact you don't even come close to being wealthy until your making 250K + for at least 5 years (assuming you don't blow it all by buying a porsche and a fat house) .
How many people make over 100K? Depends on where you live.  In most big cities alot. 

STL Indy's picture
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Joined: 2006-05-20

bankrep1 wrote:
In fact you don't even come close to being wealthy until your making 250K + for at least 5 years (assuming you don't blow it all by buying a porsche and a fat house) .

Indeed.  I think 250k is the new 100k.

rightway's picture
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Joined: 2004-12-02

For me it is a drive to get bigger and bigger.  I remember at age
25 I used to say "I am just going to work like crazy until I am 35,
then kick back."  Every goal I set and meet is followed up with a
bigger one.  I have always associated with real big
producers...now these are 5 mil plus guys/teams.  They all have
this trait in common...to just keep growing regardless of the income it
produces.  This means more than just getting new clients...it is
hiring the right people around you...very much like running your own
franchise.  I think it is just fun to be creative with running
your practice, and growing that practive is a big part of
it...maintaining it is just not good enough. I think this is also why I
like Merrill Lynch.  It affords you the tools and resources to go
so far beyond running retirement portfolios for mom and dad. 
Great topic.

ezmoney's picture
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Joined: 2004-11-30

my goal 200k , working 35 hrs/wk. simple, priceless.

brothaK's picture
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Joined: 2006-04-18

rightway, you would rather work than have fun? or is work, fun?isnt their more to life than money?obviously money is a big part of it, but when you make enough to not even care about burning 1000 dollars, than why keep WANTING to make more of it?what else is their in life to do ? beside make money???

rightway's picture
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brothaK wrote:rightway, you would rather work than have fun? or is work, fun?isnt their more to life than money?obviously
money is a big part of it, but when you make enough to not even care
about burning 1000 dollars, than why keep WANTING to make more of it?what else is their in life to do ? beside make money???

I said right in my post it is not about the money.  At a point you
make enough to be comfortable and have the life you want, in fact you
forget when pay day is.  I work between 30 and 50 hours a week
probably, and take more time off than I need to.  I donate about 5
hours a week to training the new reps in our region.   What
is nice is that I have worked to build things just how I wanted: a team
with a few reps and a few assistants all specializing.  I am as
much of a business manager as I am a Portfolio Manager and
planner.  I also just happen to really love this work, I find it
noble and rewarding, in fact it really is not work.  Non-the-less
I am sensitive to working too much and do not fall into this
trap. 

It is the drive to grow the business, add staff, add clients, be so
very unique that the clients and my firm cannot replace me.  Its
narcisistic but true...and very common. 

troll's picture
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Joined: 2004-11-29

brothaK wrote:rightway, you would rather work than have fun? or is work, fun?isnt their more to life than money?obviously money is a big part of it, but when you make enough to not even care about burning 1000 dollars, than why keep WANTING to make more of it?what else is their in life to do ? beside make money???
That's the point-for most successful producers work IS FUN!  Money is merely a scorecard that you use in a big game to see how you're doing!!

Ready2Jump's picture
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Joined: 2006-05-30

Awesome folks,

Here is what I am hearing... I can have a very comfy life at $200k
production (Indy).  And million dollar producers are trully making
tons of money.  I love the idea of having others under me,
especially with specialition.  Keeo the input coming.

Malcolm's picture
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Joined: 2004-12-02

I have no desire to double my production.  My goal is to earn as much as I can working around 30 hours a week managing discretionary tactical accounts.  I get diminishing "happiness" returns on earning more money at this time in my life and I prefer to focus on my hobbies and kids.   I am 13 in the biz.

Ready2Jump's picture
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Joined: 2006-05-30

Great... that's what I want to hear!  

jonesescapee's picture
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Ready
Not only do I agree and have a practice like Malcolm but later in life you can sell your business or bring one of your children in. Or you can stay at Jones and have some snot nosed GP's nephew take over your hard work. Again your hard work not your biz! You might get a nice crystal vase after 30 years of their bull.

Ready2Jump's picture
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Joined: 2006-05-30

Hadn't even given that much thought, but you are right on.  This
gets better with every post.  I noticed that there are not many
EDJ brokers out over 10 years.  Now I know why.  

Indyone's picture
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Joined: 2005-05-31

I got out late last summer and am on pace to do close to $200K this year, after doing about $350K in my previous life.  The sad difference is, I'm also on pace to net about $130K, which is more than I was making at my previous employer when I was grossing $350K.
Sure there is less comraderie as an indy, which is why I suppose that I post on these forums, but overall, there is no question that I'm happier, less stressed, and already doing better financially.  I didn't really anticipate the last part this soon, and it really wasn't a priority when I made my decision, but it sure is nice icing on the cake.  No doubt my clients are also better off as they are sure enjoying the FDIC insured (to $1,000,000) cash account paying 4.75%, which is just the latest in a long line of significant improvements they are seeing.

Ready2Jump's picture
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Joined: 2006-05-30

I did $14k in April... my take home was $3300.  Nice....
Makes the decision VERY easy.  I can't understand why someone
would say I'm not "big enough" to go Indy yet.  Why get big and
THEN move? 

Oh, Indy:
$14,000 gross
$8k take home after expenses.

Done.

munytalks's picture
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Joined: 2006-04-17

You might have a good point. I have heard almost everyone who is Indy say "I wish I would have done it sooner"- never have I heard "I should have waited, I wasn't ready."  In fact I know two guys who jumped out and are doing quite well. One NEVER sent out an announcement that he left, he just called folks he really wanted- the rest came by word of mouth.
Keep your overhead low and avoid partnerships.

Ready2Jump's picture
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Joined: 2006-05-30

Thanks Muny, but why "avoid partnerships"?  This is a definate
possibility for me and would love to understand your thoughts. 
Sharing economies of scale sure would help keep expenses low.  How
did you structure yourself?  

Indyone's picture
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Joined: 2005-05-31

Ready2Jump wrote:Thanks Muny, but why "avoid partnerships"?  This is a definate possibility for me and would love to understand your thoughts.  Sharing economies of scale sure would help keep expenses low.  How did you structure yourself?  
Partnerships strictly for expense-sharing are OK.  What I would avoid is a partnership where you share the clients and/or fees/commissions...that's where the real problems can start.  A 50/50 partnership where you split the rent, utilities, etc. down the middle should work OK...at least for awhile.  If you share an assistant, have the assitant track time spent for each rep and allocate that expense based on hours.  Get your own stuff as much as possible (supplies, office furniture, etc.) to avoid any hint of unfairness.  Eventually, most partnerships fall apart because of perceived inequities.  If that happens, pre-plan the divorce and agree on how you split things up before you aren't talking anymore...kind of like a pre-nup.

munytalks's picture
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Joined: 2006-04-17

Indyone says it all- I am sole proprietor. Remember what Skeedaddy said, part of the reason he went back into captivity was a failed partnership that left him holding  the "enchillada".  If you DO get into partnership- make sure you can take the whole load if you need to.

jonesescapee's picture
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Joined: 2006-05-23

Ready
Keep the overhead down to the lowest common denominator. Shortest possible lease if any on office space, part time employee, no services (shredding,house cleaning etc..). Shop for used office equiptment. The only thing I can say to pay top dollars for are reliable communication stuff....at least 3 land lines and a dedicated fax #. Don't rush into a Vonage type product just yet, give that industry a few years to work out the imperfections. Don't commit yourself to anything that is more than a year contractually.
good Luck

Indyone's picture
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Joined: 2005-05-31

I paid top dollar for furniture and technology...I wanted to make a good first impression and it sure is nice to hear the clients say how much nicer my new office is than the one I had back at the bank...

Ready2Jump's picture
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Joined: 2006-05-30

Great info folks.  Please keep it coming.  What communication
systems have you all used?  Any thoughts on not having an office
immediately, but having several places to meet clients, including their
homes?

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

Indyone wrote:I paid top dollar for furniture and technology...I wanted to make a good first impression and it sure is nice to hear the clients say how much nicer my new office is than the one I had back at the bank...
Me too.  My clients always remark on what a nice office I have. I paid a lot for the furniture, conference table, real leather chairs and brought in a lot of my personal antique/collectible items plus plenty of plants for ambiance.  Music in the background is nice too.  Technology too.  Top of the line computer, flat screen monitor etc.  Software is good too, the clients can't see the software, but they can sure see the results in their semi annual review kits.

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

Ready2Jump wrote:I did $14k in April... my take home was $3300.  Nice.... Makes the decision VERY easy.  I can't understand why someone would say I'm not "big enough" to go Indy yet.  Why get big and THEN move?  Oh, Indy:$14,000 gross$8k take home after expenses.Done.
I guess because not all of your customers will come with you and you will experience a drop in volume at the first.   I went Indy with less than the amount of AUM that others are recommending, but most of my clients came with me due to long standing relationships (some over 10 yrs) so it worked out well.
And yes, I make a lot more net than I ever did at Jones.  Yeah those 10K months... woo hooo  (sarcasm). You take home about 2K after expenses, insurance etc.  Now a 10K month after overhead nets me 8,500.  Who has to work harder to get the same results????  Clue, it isn't me.

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

We paid mid $ for the furniture & decorations, but made extra effort to make sure the new office looked markedly different from the old office. Especially in terms of design, style, function, colors etc. 
We set up what we call the "bistro" area w/ smooth jazz, a kuerig coffee machine and tv running msn, place for clients to stop in, grab coffee catch up on market news etc.(even looked into color wheel mental impact on people - after a client confessed he loved the new office colors, said the Edward Jones green depressed him every time he came to visit)
Coming from Jones where you have the "government issued" decor - it will make an impact on your loyal clients about your OWN "brand" so to speak.
There's a Van Kampen peice out called storyselling (I think) talks about set-up and office layout of successful advisors to HNW clients. Common denominator in all was photos of New York monuments, Wall Street etc, reminds clients that YOU are their link to Wall Street.
Anyway...something to consider.
 
 

Ready2Jump's picture
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Joined: 2006-05-30

AND!!!!!!!! Don't get me started on the $28k month I had
recently.  $10k net????  My BOA doen't make THAT much. 
I'm in that place where I have location gain but am not "profitable"
due to home office costs... very frustrating...

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

even looked into color wheel mental impact on people - after a client confessed he loved the new office colors, said the Edward Jones green depressed him every time he came to visit)
No kidding,  he should have to come and work in that putrid color scheme every day.  Huge walls painted dark green of death and putty grey . I did like the desks however and kept that cherry color for my new furniture. Softened up everything with beige walls, white woodwork and sage green carpet and oriental carpeting under the conference table area.  Art deco travel posters, a framed reproduction set of Fortune  Magazine 1920's covers and colorful art deco pottery etc. ( I am a collector).  Lots of living plants and a gas stove that looks like a fireplace.  Very cozy in the winter.  
The guys are probably rolling their eyes right now, but color and decor are very important in creating an impression of peace, prosperity and comfort.  I love coming into my office now, because it IS mine.

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

Here! Here!
We did varying shades of beige, with chocolate brown and black accents. Waiting room chairs chocolate brown leather, lots of vintage (30's 40's era) black & white New York photos of Wall Street, Rockefellar Center, Waldorf Astoria, Central Park etc. Carpet is lovely beige, chocolate, black basket weave pattern. Office came with french doors and blonde woodwork, so we stuck to that for desk colors. Included a nice slate waterfountain in front office for sound effect.
Clients really like it, and wholesalers who knew us at Jones comment on how nice everything is. Not to mention the transition from retail office space - to professional plaza. No subway meatball smell in office on Monday morning, no creepy Cigarette World shoppers lurking and looking in window.

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

OK...so sorry. Did the total girl thing there. I can hear the manly groans.  I might as well go hand out with Ida the handbag seller.

Ready2Jump's picture
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Joined: 2006-05-30

There are no fancy office buildings in my little town.  There are a few houses that can be converted.  Any thoughts?

doberman's picture
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Joined: 2005-02-22

Geesh! Maybe I should get my wife to respond to all these "interior design" posts! Me? I have problems getting any two socks to match.

babbling looney's picture
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doberman wrote:Geesh! Maybe I should get my wife to respond to all these "interior design" posts! Me? I have problems getting any two socks to match.
I think for an appropriate fee Devoted and I could come and decorate for you .  I'll throw in a few portfolio construction tips for free.

exEJIR's picture
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Joined: 2005-05-12

Ready2Jump wrote:There are no fancy office buildings in my little town.  There are a few houses that can be converted.  Any thoughts?
If you decide to ago that route, make a few calls on local attorney to see how their offices are set up for ideas.

Devoted SA's picture
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babbling looney wrote:
doberman wrote:Geesh! Maybe I should get my wife to respond to all these "interior design" posts! Me? I have problems getting any two socks to match.
I think for an appropriate fee Devoted and I could come and decorate for you .  I'll throw in a few portfolio construction tips for free.

I'll throw in the phony european accent (like Martin Short from Father of the Bride) for free!

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

Ready...that would be a neat location, charming. (Im picturing a cozy little victorian cottage type..complete with front porch)Think of all the client appreciation bbq's, fourth of July bbq's, swar-EEs you could throw there!

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