What do I need?
28 RepliesJump to last post
[quote=Ashland] [quote=anonymous]
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.
[/quote]
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?[/quote]
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?
[quote=Bobby Hull] [quote=Ashland] [quote=anonymous]
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.
[/quote] 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?[/quote]
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?
[/quote]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?
[quote=Ashland] [quote=Bobby Hull] [quote=Ashland] [quote=anonymous]
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.
[/quote] 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?[/quote]
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?
[/quote]
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? [/quote]
You have a knack for dodging the truty like a liberal democrap.
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 insurance
2)Apply for as much DI coverage as the company will issue
3)Rollover the old retirement accounts (401(k), IRA, etc)
4)ACAT other investments
5)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.
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.
[quote=companyman]
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.
[/quote] 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: How much do I have? (especially important if they have 4 or more accounts and possibly multiple custodians and reporting periods) 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: A credible website with private e-mail (I never take anyone seriously who used hotmail, yahoo, gmail, etc.) 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 An office that has more than one room and is not in your houseAll 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.
[quote=Ashland] [quote=anonymous]
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.
[/quote]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?[/quote]
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…