Questions for EJ guys
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[quote=footsoldier]Y-
Boone Savings & Loan. A wholly owned subsidiary of Jones Financial Companies...I would call that a relationship too. Like I said, things could have changed since I left, but they were always very accomodating to finance if we needed it. I paid cash. And before Spiff and B get all wigged out its a great bond.[/quote] Sooth is correct, it's not through Boone S&L. That entity existed ONLY to allow Jones to become a corporate Trustee. The S&L is now the Jones Trust Company. The lending for LP is done through US Bank as the lead bank. They make it very clear that it is a relationship outside of EDJ. Another conspiracy theory down the tubes.[quote=footsoldier]Guys-
I think you have missed my point...again. If Jones is so profitable where are the bonuses? The GP's will continue to make their dough at the expense of you. They won't tolerate 39% reduction in their comp. I don't think Jones will fail. I think the model might. They will adjust and you will be left in the cold...again.[/quote] I thought you might find this interesting. Someone sent a suggbox wire in stating that it doesn't make sense for us to be paying GPs millions of dollars when the company is barely keeping it's head above water. At the end of his comment, Weddle told us that the YTD returns on the LP & GP were 11% and 13% respectively. Where are the GP's making all the money? Now, 13% isn't anything to sneeze at, but the LPs are at 11%. That's not that much of a difference. No, we're not in a bonus bracket yet, but the owners of the firm are still making money. And that's the way it should be. I find this whole conversation interesting. Here's why. If I were an indy advisory going through this last year I probably saw a decrease in my production mostly from fees going down instead of up. Now, I don't know exactly what it costs to run an indy office, so I'm going to make up some numbers. Doesn't really matter if I'm close or not. Let's say in 2007 I had $500K in production, with an 80% payout, and $100K in fixed expenses. I cleared $300K. Pretty good year. However, in 2008, my production dropped 30% because I had a lot of fee based assets. So, I'm down to $350K in production, with an 80% payout, and $100K in fixed expenses. So in 2008, I only cleared $180K. I find it interesting that you keep saying where are the bonuses. Didn't I just lose $120K in income in 2008? Am I going to quit and go do something else because my income went down? No, I'm going to work harder to get that income back to where it was in 2007. I'm going to go after new assets so that when this thing does turn around, I can hit $750K in production instead of $500K. It's works the same way at Jones. If you got a bonus when things were going well, you expect that you'll get back there shortly. Just so you know, I've not heard a single vet talk negatively about the bonus situation. We all know why we aren't getting bonuses right now. We're smart people (well, most of us anyway) and we know that you have to take the good with the bad in this business.Spiff-
Again you are drinking. Who pays for the growth? Not you because your production doesn't warrant bonuses. Ask any producer who was receiving the extra checks and I will bet my last dollar they ain't happy. They will put up with it for awhile, but if in fact the GP's are making 13% and LP's 11% who does that leave out in the cold? Have you received a bonus ever that is equivalent to 10% of your annual pay? BTW. I admit my mistakes and I looked back at my paperwork for my LP years ago and you are 100% correct it was US Bank. Since I paid cash, I didn't recall. Have to look eleswhere for a conspiracy!Btw-
For years you have Mr. Spiff, maintained that Jones isn't comparable to indy. And as the doublespeak goes...you did exactly that. You will be a great GP someday.foot - Just for those of us who are following the banter and obviously you can choose not to answer, but what was your AUM when you left EJ and how long were you there?
I started from scratch in 1997. I ended with 44M under management when I left in 06. I was told I was a star…I earned LP…and now I am at 28M, half in fee base or recurring revenue, had a good year last year up 48% and this year tracking at 15% above same time last year.
Assets don't matter. Producing assets do.I don’t think he means he’s in Seg 2 yet, just that the has the production numbers to qualify. And yes, you have to be in each segment for at least 4 months.
I think Jones should change from production to AUM. When I was there a lot of people hit the production numbers only to flame out because they didn’t have enough assets to support it…For example… seg 2 when I was there was $8K gross… And some guys did one huge month followed by crap and qualified then a 6 months later they were gone because they couldn’t maintian there new seg without any assets…
[quote=footsoldier]Btw-
For years you have Mr. Spiff, maintained that Jones isn't comparable to indy. And as the doublespeak goes...you did exactly that. You will be a great GP someday.[/quote] I still don't think indy is comparable to Jones or any other non-indy equivalent. I simply used the higher payout in the indy world to demonstrate that this market has taken money out of many advisors pockets. Whether through a bonus system like at Jones or a payout system like yours, the net effect is still the same. I wonder which will come back first - bonuses at Jones or the AUM for the fees elsewhere? And as for the GP comment - thanks for the compliment.Thanks foot. You are absolutely right, 100 mil in AUM doesn’t really matter when they are 30yr Muni’s and A shares.
I was trying explain "dead assets" to a friend of mine who just went indy from Jones.. He was so happy he xfered $15Million to his new place, but he kept telling them "Nothing will change about your investments". They are all in A shares and 25 yr bonds...so assuming he had all of it in A shares.. that is only $37K in production vs if he was to annuitize half of his book that would be $75K in production(7.5Million at 1.0%), but he keeps missing the point of dead assets..
Spiff-
I would buy your argument if the firm was more interested in helping you succeed than finding the next FA to replace you if you fail. Your firm just started the advisory program to be competitive, because you were losing FA's and clients to fee based programs. We all have seen recurring revenues drop, how does that wash with the vets who are losing out. Let me illustrate it for you; You are a 360K producer netting 136,800. Typically your bonuses range from 13.6K to 27.2 depending on your expenses, etc. You continue to see the growth, now you have lost the bones. You see LP at 11% and GP at 13%. Do you feel left out? Or do you feel that for the good of the firm, you go without because your bonus was extra, and someday when you go from the 0% bracket back to 50% bracket it will be made up. I am making any sense to anyone out there besides Spiff? Are you out of seg 3? Your admission that we aren't comparable, and yet you compare is laughable. Spiff you can't have it both ways. Unless you drink the koolaid and learn how to speak in circles.I disagree...I have done plenty for clients that didn't make me a dime. If you treat your clients with respect and ALWAYS do whats best for them, then you will be repaid in the long run (referrals, client gets new money). Now that doesn't mean there aren't times that what is best for the client, isn't also good for the FA. But the statement as a whole, is very untrue. I always do what I beleive is best for the client. As far as the times. It's a struggle for sure for alot of people, but I think it's going to separate the good brokers from the great brokers. There's never a better time for a newbie, because we can come in and take accounts from a broker that hasn't took the time to spend with his client. But for someone with a book, I honestly don't beleive that its ALL the economy. I feel like alot of Vets are use to doing their business a certain way for the last 10 years or whatever and now when times are hard, they want to pick up the phone and do things the same way they were doing things when times were good. I think it's going to force alot of Vets to make some housecalls, and force them to do a whole lot more prospecting. Those Vets are the ones that will hang on to the gold, in my opinion atleast.[/quote] So Wind you are 4 months in and you have all of the answers ? You have done plenty for clients that didn't cost you a dime ? Cmon now. I know your RL is probably giving you the reach around at the new FA meetings, but please remember you don't yet know what the hell you are doing.[quote=buyandhold] Jones FAs like their firm, but they will do what’s in their best interests just like anybody else.
[quote=Squash1]
I was trying explain "dead assets" to a friend of mine who just went indy from Jones.. He was so happy he xfered $15Million to his new place, but he kept telling them "Nothing will change about your investments". They are all in A shares and 25 yr bonds...so assuming he had all of it in A shares.. that is only $37K in production vs if he was to annuitize half of his book that would be $75K in production(7.5Million at 1.0%), but he keeps missing the point of dead assets..
[/quote] Squash, Give him time. It takes a while to de-program. He will slowly come out of it.I will, but he hasn’t started prospecting for new (non-Jones people… Yes I believe there are Jones clients… and everyone else) clients… I think he will row himself in a circle start prospecting too late and be stuck… maybe not…