Wells Fargo Finet

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agebroker5's picture
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Joined: 2008-10-14

Has anyone made the move to Finet from A.G. Edwards I mean Wells Fargo? I just curious what the process was like & was it as easy as it sounds?  

LovinIndependence's picture
Joined: 2010-11-15

The process is just about the best way to transition to the Independent Space in my opinion...  No wars over your accounts, the opportunity to lead the client conversion process by at least 2-3 months prior to your last day in PCG...   It will take some work and planning, but much easier than switching firms.  The 15% you leave behind the 1st year as compensation to PCG smarts a bit, but considering what ACAT Fees and potential loss of clients makes this a wash.  I figure I still netted about a 48 - 50% payout with the 15% gone, still higher than I was getting in PCG, this will now ramp up to approx 65% after my expenses since I am past the 1 year mark.  Your revenue(s) can effect this percentage, higher or lower. There is a certain point that every dollar hits your bottom line, so it is possible for this to be higher or lower.   This was...  hands down...   the best move for me.  At the end of the day, no more BS from the bureaucratic mess that is PCG...  I actually like coming to work again! 

BigFirepower's picture
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Joined: 2010-07-09

Finet seems like a no brainer for an established rep at those firms. So, why doesn't everyone do it? Also, why does Finet get low marks in the Indy BD comparisons? Are there issues at Finet?

SuperMan's picture
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Joined: 2010-09-18

Too bad Jones does not allow for this model. 

agebroker5's picture
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Joined: 2008-10-14

Why? Jones pay's about half the commissions that Wells Fargo pays on the same products. So you would get a higher payout on less commissions. I think Finet is the smartest choice. 

SuperMan's picture
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Joined: 2010-09-18

Not if you are a Jone's employee.  And as for 1/2 the commissions on the same products, shut up. There is a hair but but it ain't close to half.

BigFirepower's picture
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Joined: 2010-07-09

Jones previously was in a way, an indy shop. Over the years, as costs and barriers to entry have dramatically declined, Ed Jones has not raised the pay out. That's just the way it appears to me anyways...The numbers don't lie. When you look at the size of the top 3 or 4 indy providers, it's obvious that those firms can provide just as much, if not more than the typical wire house. When you toss in higher pay, and a complete lack of corporate bs and shenanigans, it's a no brainer for a veteran broker. In the coming years, the traditional firms will indeed have to adjust to this, or they'll pay a huge price in attrition. That attrition is coming in the years ahead, as more and more reps have gone past their contract periods. The big joke on brokers, is the getting a check thing, as they'll realize that net equity in their own firm is worth more to them. All but the hand to mouthers of course...

ShredderSr's picture
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Joined: 2010-07-23

LovinIndependence wrote:The process is just about the best way to transition to the Independent Space in my opinion...  No wars over your accounts, the opportunity to lead the client conversion process by at least 2-3 months prior to your last day in PCG...   It will take some work and planning, but much easier than switching firms.  The 15% you leave behind the 1st year as compensation to PCG smarts a bit, but considering what ACAT Fees and potential loss of clients makes this a wash.  I figure I still netted about a 48 - 50% payout with the 15% gone, still higher than I was getting in PCG, this will now ramp up to approx 65% after my expenses since I am past the 1 year mark.  Your revenue(s) can effect this percentage, higher or lower. There is a certain point that every dollar hits your bottom line, so it is possible for this to be higher or lower.   This was...  hands down...   the best move for me.  At the end of the day, no more BS from the bureaucratic mess that is PCG...  I actually like coming to work again!  DITTO!  Best thing we ever did.  6 months into it and I wonder why we didn't do it sooner.

LovinIndependence's picture
Joined: 2010-11-15

I was with Jones years ago, this is closer to the Independence and Autonomy that Jones and even my experience with AG Edwards used to offer, only more so.   But the payout difference is huge.  Having your own shop is not for everyone, but in my book it is well worth it.  You also have much more flexibility in declaring a salary for yourself and then taking Dividends out, saves on FICA etc.  You can do your own SEP or Single Owner 401k plan and do some serious tax and retirement planning with those tools.I also have been participating with FP Transitions in evaluating my business etc, I now have some hard numbers as to it's worth based on a hard cash price or a transition value...  Certainly helps my net worth number and I can see how business are indeed being bought and sold.

agebroker5's picture
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Joined: 2008-10-14

There aren't any problems at Finet. I think the reason for the low marks has to do with commissions. Since Finet is tied to Wells Fargo all of the comissions on products is directly tied to Wells Fargo. For example VA's pay 6% at Wells and you could get paid 7% at most Indy's. The positives are no ACATS. The same computer system. The same wide array of products. No other indy comes close to what Wells has to offer. I seems like the easiest way that there is to go indy. I am trying to find a reason not to go and I can't seem to find one. I have some deferred comp due in March and I am still waiting on my second 4front payment. I was told it's best if you qualify and take the award under the same channel. I will lose a back end retention payment that is due to be paid to me over 5 years starting in 2013 if I make them move but all retention that I have been paid already stays in my pocket. I keep all my clients all my rtetention and no ACAT's same products same computer system. What is the downside? Do any indy recruiters see a downside to this move vs. some other indy firm or full service firm?

ShredderSr's picture
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Joined: 2010-07-23

agebroker5 wrote:There aren't any problems at Finet. I think the reason for the low marks has to do with commissions. Since Finet is tied to Wells Fargo all of the comissions on products is directly tied to Wells Fargo. For example VA's pay 6% at Wells and you could get paid 7% at most Indy's. The positives are no ACATS. The same computer system. The same wide array of products. No other indy comes close to what Wells has to offer. I seems like the easiest way that there is to go indy. I am trying to find a reason not to go and I can't seem to find one. I have some deferred comp due in March and I am still waiting on my second 4front payment. I was told it's best if you qualify and take the award under the same channel. I will lose a back end retention payment that is due to be paid to me over 5 years starting in 2013 if I make them move but all retention that I have been paid already stays in my pocket. I keep all my clients all my rtetention and no ACAT's same products same computer system. What is the downside? Do any indy recruiters see a downside to this move vs. some other indy firm or full service firm?There are always some give and takes. You'll get pd the 4skin award regardless.  The backend of the retention deal is all smoke and mirrors.  Did we sign anything that says we are entitled to it? Defered comp?  You'll make twice as much in additional payout over the next 5 yrs.Here is something else to think about.  I've heard the FiNet transition dates are out to June 2012.  Why is that?  Too many FA's fianlly figuring it out.  Just a matter of time before the ability to transfer channels disappears, just like Profit Formula.  Go while you can.

Times7's picture
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Joined: 2010-10-26

For those on the outside of Wells looking in, the recruiter who made a follow-up call to me clarified that  the real bonus money begins at over 400k GDC. Up to 100%  "loan" to 12 month trailing GDC, depending on residuals.   Anything less, bonus not so attractive. Even with very high resids.

Finetized's picture
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Joined: 2010-11-18

BigFirepower wrote:Finet seems like a no brainer for an established rep at those firms. So, why doesn't everyone do it? Also, why does Finet get low marks in the Indy BD comparisons? Are there issues at Finet?Our main issue with Finet is their unwillingness to allow true independence.  It's actually become the slogan, "Independence, Simplified".  It's simplified all right.  The old joke used to be Wachovia Finet was Indy with training wheels...it has only gotten worse since Wells took over.  Don't get me wrong, you have total control of local ops without the bureaucracy of the PCG Death Star...and the payout is higher....but if you're the type who wants to run under your own brand without the need to cobrand, and want to use more third party material than in-house the old familiar bureaucracy rears its ugly head.  You'll get pretty frustrated with hearing various versions of "no".  The product group (yes, PCG) has final say over both compliance and your regional supervisor.  That was a recent policy change, and they really don't want that advertised.  Finet management has one arm tied behind their back on everything.  If you love the red and gold, use Envision heavy and want access to bank product and the Wells brand then it doesn't matter....but if not it's just a temporary move to own the book and find a better home later on. 

LA Broker's picture
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Joined: 2008-12-03

TImes7When you say the recruiter told you over 400K is when the real money starts up to 100% was that for Wells wirehouse side, bank advisor side or FINET?

I am legend's picture
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Joined: 2010-03-04

The only drawback I see with FINET is for clients who have mutual funds and will pay over $30 to liquidate a fund when they are now used to paying $5.  Of course you could absorb this cost, but that would be expensive to you as well.  Also, on fee based you pay up to 30 bps in admin fees even on platforms that in PCG there are no admin fees on.

Times7's picture
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Joined: 2010-10-26

FINET. 100% includes the production (70% of previous GDC trail retention) bonuses.

ShredderSr's picture
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Joined: 2010-07-23

I am legend wrote:The only drawback I see with FINET is for clients who have mutual funds and will pay over $30 to liquidate a fund when they are now used to paying $5.  Of course you could absorb this cost, but that would be expensive to you as well.  Also, on fee based you pay up to 30 bps in admin fees even on platforms that in PCG there are no admin fees on.Ticket charges are applied at ALL indies: LPL, RayJay, everywhere.  You can either eat it or bill it to the client.  There are no ticket charges in advisory accounts.I am pretty sure that RayJay charges an 'admin' for advisory accounts.  FiNet's is based on a sliding scale that decreases as assets go up.  It is just something that you factor into your pricing model. i.e. <$500k is 1.25, $500k-$1MM is 1%, etc. Your net/net payout after admin fees is still close to 75%.  Beats the 42-44% I was averaging at PCG.

BigFirepower's picture
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Joined: 2010-07-09

What is PCG exactly?

Bully60's picture
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Joined: 2010-11-19

Private Client Group (Wirehouse divison).

Finetized's picture
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Joined: 2010-11-18

ShredderSr wrote:I am legend wrote:The only drawback I
see with FINET is for clients who have mutual funds and will pay over
$30 to liquidate a fund when they are now used to paying $5.  Of course
you could absorb this cost, but that would be expensive to you as well. 
Also, on fee based you pay up to 30 bps in admin fees even on platforms
that in PCG there are no admin fees on.Ticket
charges are applied at ALL indies: LPL, RayJay, everywhere.  You can
either eat it or bill it to the client.  There are no ticket charges in
advisory accounts.I am pretty sure that RayJay charges an 'admin'
for advisory accounts.  FiNet's is based on a sliding scale that
decreases as assets go up.  It is just something that you factor into
your pricing model. i.e. <$500k is 1.25, $500k-$1MM is 1%, etc. Your
net/net payout after admin fees is still close to 75%.  Beats the 42-44%
I was averaging at PCG.I will second Shredder that Finet does advisory pricing well...at least the client directed Asset Advisor...w/o ticket charges or investment guidelines....and it beats the PCG payout even with the admin.  And yes, RayJay also charges the same admin fee on client directed advisory but ALSO charges a $30 ticket charge both ways that you can always eat.  Still waiting to hear a valid reason for that, btw.

BigFirepower's picture
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Joined: 2010-07-09

Pretty interesting, to see this huge Wells Fargo machine. What's the future of this mega bank and brokerage firm? Spin offs? Do you folks that are there, see some signs of progress, going the right direction, or is it just a mess? Wells Fargo, Wachovia, Everen, Finet, Ragen Mackenzie, probably missing some, and you've got a lot of different cultures all under one roof..

Finetized's picture
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Joined: 2010-11-18

BigFirepower wrote:Pretty interesting, to see this huge Wells Fargo machine. What's the future of this mega bank and brokerage firm? Spin offs? Do you folks that are there, see some signs of progress, going the right direction, or is it just a mess? Wells Fargo, Wachovia, Everen, Finet, Ragen Mackenzie, probably missing some, and you've got a lot of different cultures all under one roof..IMHO, it's a mess.  Same clogged back office but with no authority.   We're convinced Wells management hates the indy channel, we're just a fly in the ointment.  They have 6 products sold for each customer in their bank "stores", and their mantra for the year is "8 is great!".  Hoping to be spun off and acquired, may be why they've moved the transition date so far out to keep headcount steady...but that's probably just wishful thinking.  Literally don't care who buys as long as it's not a bank....even a wire who wants an indy channel would be more broker friendly.  At least they get brokerage and like the biz.

agebroker5's picture
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Joined: 2008-10-14

By the way the transition dates are not out to June of 2012. I don't know where he got that info. I called FINET it's 3-6 months out from now. It's funny how much incorrect info floats around in these forums. 

BigFirepower's picture
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Joined: 2010-07-09

Finetized, what would you think of LPL or RJ, or some other indy firm buying that asset from WFC? How many reps does Finet have?I'm with a privately owned Indy BD. I just love the idea that I don't have to put up with "endless change". My former employer was really big on making excuses about change being good, normal, blah, blah.... No, if you do things the right way, you DO NOT need to constantly change things, create upheaval.

I am legend's picture
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Joined: 2010-03-04

Finetized wrote:ShredderSr wrote:I am legend wrote:The only drawback I see with FINET is for clients who have mutual funds and will pay over $30 to liquidate a fund when they are now used to paying $5.  Of course you could absorb this cost, but that would be expensive to you as well.  Also, on fee based you pay up to 30 bps in admin fees even on platforms that in PCG there are no admin fees on.Ticket charges are applied at ALL indies: LPL, RayJay, everywhere.  You can either eat it or bill it to the client.  There are no ticket charges in advisory accounts.I am pretty sure that RayJay charges an 'admin' for advisory accounts.  FiNet's is based on a sliding scale that decreases as assets go up.  It is just something that you factor into your pricing model. i.e. <$500k is 1.25, $500k-$1MM is 1%, etc. Your net/net payout after admin fees is still close to 75%.  Beats the 42-44% I was averaging at PCG.I will second Shredder that Finet does advisory pricing well...at least the client directed Asset Advisor...w/o ticket charges or investment guidelines....and it beats the PCG payout even with the admin.  And yes, RayJay also charges the same admin fee on client directed advisory but ALSO charges a $30 ticket charge both ways that you can always eat.  Still waiting to hear a valid reason for that, btw.I don't have a problem with ticket charges when it is something that you are getting paid on, but the problem I have is the $27 FINET charges for mutual fund sells.  Those of you at FINET--do you absorb those or pass to clients?  Also, did the clients have a problem with this when they noticed the difference from PCG?

ShredderSr's picture
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Joined: 2010-07-23

Depends on the relationship.  If it is a decent size account then yes we eat the $27 ticket charge.  For smaller accounts or acats, we tell them the cost and then charge the client the fee.  No one has given us a hard time.If you have multiple funds in the same family, the easiest thing to do is do a fund exchange into the money market (no ticket charges on exchanges) at the fund and then liquidate the money market (one $27 charge).

BigFirepower's picture
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Joined: 2010-07-09

We have an IRA fee at my indy, it's $35. Our fund ticket charge is $20.On the fund charge, it bugs me. What I need to do is minimize the number of trades in that area, to reduce the cost to the client. Client pays. The IRA fee, well, if a client calls us, we waive it for them. If they don't call, they pay. We have over 100 IRA accts, so auto waiving the fee, would cost us $3,500. I think we'll wind up waiving about 20 of these. For anyone contemplating Indy, the issue of fees and ticket charges is something to be well aware of. Also, if you are new, the outgoing and incoming acat fees can be pretty significant. For a good sized operation, between 6-12k. 

RWM's picture
RWM
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Joined: 2010-06-08

FINET has just under 1000 adivsors with 445 offices.  If your comming from PCG it's a good move other than the 15% haircut the first year.  Now you can move an entire "household" with one signature. You cab repaper AGE notes and 4front notes at around 3%. The back office is improving eveyday and your liason at FINET will cut through the bull for you for the first few months. Health insurance for you and your staff could be a deal breaker.  Know the health situation of your gang before you sign a lease. Raymond James and LPL also have great platforms.  My buddy at Raymond James says its like AG Edwards with higher payout.  Good Luck!Make a decision before it's made for you! 

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