How To Go Independent

An objective source to learn about independent business models

Brad Weddle -- "wish I had done it sooner" despite his "disappointing" transition from Edward Jones

InterviewsSean KernanComment

This is a transcript of HTGI podcast episode 25 (click HERE to check out that show) I did with Brad Weddle. It has not been edited to a final draft quality, so please excuse any hard-to-follow passages. You can also listen to the show using the media player to the right. 

Sean: Brad why don’t you give us a little background on how you got here both in the industry and the step that you went to, kind of the background that brought you to looking at the independent model in general?

Brad: Okay. Good question. Well, I grew up and my family had no experience in investments. I was taking a college class and the teacher said you’re going to purchase a stock and purchase a call option,  which I knew nothing about call options and very little about stock. Then she said whoever gets best returns gets bonus points. I thought I may like those. I may need those. Well that was 1982, I picked Wal-Mart as my stock and Doctor Pepper as my call option. They came in first and second respectively. I was hooked and I started buying some stocks and mutual funds at that time. Going forward I was working and as I said, I was in college working full time with Texas Power and Light which became Texas Utilities. I had a plan that was a predecessor to a 401(k). At the time you can put in up to 12% of your money in it. By that time I got married, bought a house, and was trying to go to college and actually taking a pay cut so I could finish college. I started with 4%, got a raise, part of it with taxes, part of it I call toys and life, raised my contribution to 6, later to 8, to 10, to 12. Before I knew it I was putting back 20%. I worked nine years with Texas Power and Light but after I graduated college they transferred me and I was into -- I’ll call it part-marketing, part-engineering job -- and when I moved every firm in the world call to talk to me about investing and selling me mortgage cancellation which is effective life insurance. And so I just had an interest in investing and that actually is couple of my first licenses or registrations back in the late 80s. And in early ‘92 or early 90s, Texas Utilities offered an early out program and I wanted to do something different, I didn’t know what, and here I am, with a work full time in this business. In ‘93..

Sean: I don’t remember that part about you getting those licenses. How did you procure the licenses then?

Brad: Well a lot of the companies (were) calling on me when I moved to Mesquite area. And in ‘87 (I believe it was) where life insurance agencies, they were some broker/dealers and they were trying to sell me life insurance a lot and “oh it’s a forced savings plan” and I’d heard the term “buy term and invest the difference.” And so I did that and followed the concept and I actually got my license with Primerica. Going forward, when I started in ‘93, interviewed with a couple different firms, A.G. Edwards and Edward Jones, and I went to work for Edward Jones and worked for them for about fourteen and a half years and left in the great timing of December of ‘07.

Sean: What made you start looking around to make a change? That’s a pretty good stretch at one place and I think you were doing pretty well from our conversation and so what made you look around? And tell us about that time and how that process went in exploring.

Brad: Good question. It was accumulation of things over time. I was beginning to see some advisors retire and we were told we didn’t own our book of business and we couldn’t sell it and that nobody in the industry could. Well, I did a little research and found out that yes when you’re independent you actually own your book of business and you have an asset that you can sell. In my case I’ll call that a pretty nice figure. With a lot of people could retire. My other firm, we were a partnership and you got limited partnership by production but also by how you help out in the region. But that was always on arbitrary numbers. “What do I get for trading this percent? What do I get for this?” Nobody would tell you.  

Sean: Brownie points, basically.

Brad: Brownie points! I had someone come into my office, given the part of my business, a very nasyid start for one, it allowed him to build his. Well, he was to move out and the plan was to be completed by December but his office was not ready so I didn’t kick him out the door till February. That April they came around talking about partnership and I said “no you haven’t completed the plan.” It’s not my fault that it wasn’t completed. And so I didn’t get partnership that June when I offered him not as much I got partnership but not for the plan that I’ve done with him. And that was kind of the final straw but it was an accumulation of more services to offer at my current broker/dealer, more investments to offer, I do own my book of business, I can overwrite them, share office space, etcetera.

Sean: Gotcha. And this is from one step back, how did you build that business and how did you run your practice? What was your business model at the old place?

Brad: At the old firm I literally built it from scratch. I worked in a town about 30 miles away with a small church here, and a few neighbors. And that was it. So literally built it from scratch by door knocking and literally knocking on residences and businesses and then just cold calling on the phone. There was a second office in town for that firm and there have been one or two that have failed in between at first. And I think when I left there were six and I actually checked that they have eight current advisors in this area. Although I created a few of those when I left. I tried to obviously kick my book of business and split it up over several advisors. But I started from scratch.

Sean: And in terms of your business mix, what types of investments did you use and that sort of thing?

Brad: It has evolved over the years and that’s an Interesting question because when I first started, a lot of the people I knocked on doors, I was their first step away from the bank. And interest rates were beginning to come down but still a lot better than they are here in 2016. So at that time we had insured corporate bonds which do not exist. With the government agency bonds like Freddie and Fannie and TVA, we had triple A insured mini bonds. Those are pretty much going away as well. The insured corporates don’t exist, fixed annuities were paying much higher. So my business was probably 40% fixed rates. And then I did a lot of roll overs as people were retiring or changing jobs and rolled their 401(k) to an hour rate. A lot of mutual funds back then have Exchange-Traded Fund or ETF and prior firm didn’t have some of the investments that we currently have but I could use now as well.

Sean: And this is all brokerage business, correct?

Brad: It was all brokerage business. I went transactional, pretty much A share mutual funds of one-time sales charge upfront. The service fee I guess, the CDs or bonds, you know, you got paid in a mark upfront one-time so you might do it twenty or thirty-year bond and have a gross of 2% or 3% but you have to get 60% of it to the other broker/dealer which is interesting that one day I was looking at my profit and loss statement which covered my office expenses, my assistant, half of the phones (‘cause I paid the other half out of pocket), half of the postage (which I paid the other half out of pocket), and it cover what they paid me, etcetera. And yet after all of that in my part of the home office expense I still had anywhere about 150,000 dollars worth of profit from my profit loss. I kind of got to scratch my head one day going “Gee, where that money going?” Now I get a larger portion of that in my pocket.

Sean: Great. Yeah you’ve had a little bit of -- I guess the “bonus calculation.” It was a lot smaller than that on analyze basis.

Brad: That’s interesting, you mentioned the term “bonus”. I left the other firm in December of ‘07, obviously walked right into the market of the late/previous firm. Yes I did all for bonuses. It was a stair step or staggered bonus system and subjective but in a way they didn’t have a bonus. For you to know I would’ve been very profitable, I wouldn’t have gotten sure in that bonus.

Sean: Great point.

Brad: And I kept all of that 100 or 150,000 dollars worth of profit above covering all the other expenses and overhead. So here, I get to keep a significant part of that.

Sean: Now when you realized that this would be the place you stayed for forever, how’d you go about looking at the choices out there and what was important to you? Just tell us a little bit  about the mindset and how you came to the decision on the firm and then maybe a little bit about how you plan to make a change.

Brad: Over the years many firms have called back in the mid ‘90s. Merrill Lynch have tried to do, kind of the Edward Jones, my prior firm's concept of stand alone offices and Merrill have tried some but every bank in the world, they called me, that had a broker/dealer, couple other firms over the years but I started looking probably early ‘05 or ‘06 and talked to several of your major firms, wirehouses, talked to some independents, which is looking at the side of that I didn’t want to work for other wirehouses. I needed to stay here locally at the town that I’m in. I wanted to keep my presence here. I wanted to be independent to be able to control my own destiny, control my own paycheck, own my own book of business, etcetera. And as I get to looking and kind of nerd it down to probably forty major independent firms, I looked at the technology, I looked at where the advisors had come from, and going forward, I chose this firm.

Sean: Very good. How long do you think it took when you made that decision? Okay, you know where you’re going, how long did you take -- I know you’re kind of a planner, you think way ahead -- how long before you pulled the plug? And how long do you think if someone were really gung ho like “how long could it take?” “How short could you get that done?” What was your experience?

Brad: Good question. Mine was kind of unique. I was about ready to move a year before I did, I had two different contracts in hand for various office space. One was in a multi-storey bike building, I’ve also looked at the only seven-storey building in my town but didn’t like that location for a few reasons. And then I had another one that was owned by church and interestingly enough the head of the church that I was dealing with was already a client of my firm but with a different advisor so I had the story and the secrecy. But I backed out, I didn’t move for a year and I actually told the gentleman that I brought into me who was one of my persons when I left. I waited a year and unfortunately in this business you don’t give a two-week notice. You give a two-minute notice. They come to lock the doors, make up stories and obviously go after your clients pretty heavily, which laid back my clients over there between two offices and try to give assets to at least the third one, if not more. So I finally moved but in that moving process I found a location, signed the lease, and it was basically a sale so I built it out over a three or four-month period, ordered furniture, ordered computers, monitors, telephones, etcetera. That was quite the interesting challenge of versus I had a body that also left at firm after I did and he’s basically flipped a switch and walked into a already built out office space. He had to leave in a little bit of a hurry so he didn’t get to do quite the planning that I did upfront.

Sean: Gotcha. Maybe we’ll come back to touch the pros and cons to those two choices ‘cause I think one of the things I find exciting and I think some people find intimidating is sort of the unlimited spectrum of choice between what you describe of building your own office from the ground up -- from the shell condition. On the other side of that is the idea of plug and play. Obviously there’s considerations about what that means, what you get, what you give up for the plug and play model. But I know you’ve built a pretty substantial business. Do you mind sharing your asset production, levels right where you left?

Brad: Good question. I know in around September of ‘07 I had roughly 150 million and that was after I’ve given away 1.3 million a few years earlier and 10.6 million to the gentleman that I brought into the office so from ‘93, (I think my cancel date was) August of ‘93 through, (as I recall it) September of ‘07 roughway 125 million. I think when I finally left in December with the market headed down, not realizing how badly they were gonna go down, I think I was 21 tn 115.

Sean: Gotcha, okay. Pretty substantial business and obviously financially you were in pretty good shape with that kind of asset base. So take us to the move. When I first heard this story we’re sitting at our national conference and my instinct of joke was “why did you leave when the market was gonna go down?” That wasn’t very smart. You should’ve waited. But walking through that process, I know you got some lessons learned. Give us a sense of pulling the trigger and what went well and what didn’t especially with the person who -- if they would ever consider this -- you know, it’s scary not having done it before for some people. How did it go and what did you learn?

Brad: Can we go back just a little bit, you mentioned the plug and play concept. Doing it the way I did, there is a risk of getting caught and even probably asked to leave or forced to leave on the spot and that’s an advantage in my office wherein in years a new advisor coming over could literally walk in the door, they could leave the prior firm and then as soon as their license transfer it later that day or something (or that week), they could plug in and already set up with the desk, the computer, the software, and all they gotta do is plug in and start working to get their book of business over.

Sean: Very little infrastructure to establish.

Brad: And they would have some help but I literally did not ‘cause I pretty much did it on my own that time. That part is good, I think the plug and play is a good way to go about it and have some assistance and not have to reinvent the wheel.

Sean: Yeah I guess the scene that I was referring to was there are a lot of folks out there (or at least some) that are already independent that set up the plug and play. I think we’ve seen people try to establish what I would call a “mini-wirehouse” so the economics, so that arrangement still don’t work even if it’s on the independent channel. But if you have someone that prices the services and the infrastructure correctly and that’s more of closer to a co-op model where you’re not giving up a huge chunk of the revenue to put you right back in the same payout then it can work very well.

Brad: Exactly. I’m part through the broker/dealer, part through the RIA for the advisory side, which coming from my prior firm at the time had no advisory business. So that was brand new to me. It was big in the wirehouses but my prior firm thought it was the worst thing in the world to have advisory and have discretion. But yeah, if I join the hybrid here and actually end up getting a raise even from being straight with the broker/dealer just because the expenses were cut. So that was unique and had some colatory, had some training through the hybrid RIA, had some sharing of ideas, able to back me up if I’m disabled or out of the office for a week. So there’s certainly advantages to plugging and playing. My timing of leaving, as I mentioned, I couldn’t have timed it worse. The market went extremely south there in a way, I think from high to low the S&P was down to 57% in that year and a half span and I put two advisors directly in my office as I mentioned and I got them to phone calling and all kinds of help. I did a good job at keeping more clients that I would’ve liked to. I probably got more (I don’t know) 70% or 80% of the clients and unfortunately I only probably got 50% of the revenue. At that same time I know some clients left that prior firm altogether and didn’t go anywhere. Some came here, some went to other office of that firm. So they didn’t stay there locally.

Sean: When you did the post mortem, (however long) after 6 months or year, (whatever it was), when did you realize who was not gonna come? Probably given them enough time and was not likely to come at any point? Did you find any common patterns among who came with you versus who didn’t or was it fairly random?

Brad: That was interesting. I had made a list before I left. I did not tell anybody that I was leaving. I told our best friends the night before ‘cause they helped us move. Interestingly enough, they were clients of another office. (‘Cause I didn’t hear I did some money that was already in their office) but they helped me move. I resigned on a Monday morning at nine o’clock or so I got a call immediately, go three miles down the road, and open a new office, and waited for my license to transfer (and it did around noon), and I sent out letters, and started calling and seeing folks. I made a list at the time going “hey, here’s a lady that was literally one of my largest and her whole family around the country have been with that prior firm. So I really didn’t figure she would come. She did.” “Although that was not in the country, I think he’s been with five advisors at the time I had him I would’ve certainly liked to have him but it was on the block, kind of on the bubble of whether he would come at another one. And the closest thing she’s got a son and grandson”, etcetera. I was pretty accurate on that list, I had some surprises, both good and bad, that list of who I thought would come and who did not. But I picked up some clients here that one walked out the other meeting and they brought their sister with them who was at a different office with other firm and she says “she wants to move with you too.” When I originally came over I kept clients just brokerage and didn’t involve into advisory probably till several years later. It’s interesting, I met one of my former colleagues who’s in different office at the prior firm. He has done a lot of fixed rates as well over the years and when I talked to him obviously fixed rates were basically paying. Nothing now in the insurance bonds are going away and I said “what are you doing?” He was doing a lot of dividend paying stocks. Well, as an example, if you had four hundred clients who knows four hundred in that stock, he literally had to call all four hundred before he could make a change. That’s not a very efficient way to manage a book of business. And unfortunately when you’re trying to call four hundred, that would take weeks, one client’s in the hospital, one on a cruise in the caribbean. Here, with the technology and tools and the models that I’ve set up, I can literally push a button and in a matter of minutes have moved a client either out of that particular stock or mutual funds or ETF. A much more efficient way of doing your business, running a business, and frankly helping your clients when the market is going crazy like in the years not just away, either maybe 2011 or early part of 2016 even.

Sean: So you find your clients having those calls or you to say “yeah you’re in every single investment”, are they okay with the new way?

Brad: That’s interesting ‘cause even back then I would say 95% or 90% of the clients “Brad whatever you think”, “Brad that’s why I’ve got you, make that decision.” But even now I stay in contact with my clients through in person reviews, internet, emails, phone calls, etcetera. And I do newsletters, I do some unique letters to help educate and to stay in touch with the clients and once I explain the concept of what we’re doing and this manage account as an example, they get it and one of my programs that I have to do is design to be really grow and produce in the good years but preserve more of the money as best I can in the down years. And the older clients really seem to appreciate that and it worked well. I can’t imagine going back to the other way at this point.

Sean: Yeah I’m with you. And I think the scalability and flexibility of having discretion, it allows us to spend that time or talk with clients, talk about their goals and objectives not about the intricacies of what xyz dividend is gonna be or every little thing that we were kind of trained on the early days to talk about with people. We can talk about their goals and more important stuff. So for me (from a payout standpoint) let’s say probably around forty-ish percent or a little bit higher when you throw in all the little extras that Edward Jones and firms allow, you’re a pretty detailed guy do you have a sense of -- for similar manner of revenue -- what your net bottom line is after your expenses as an independent advisor?

Brad: Good question. Since you mentioned my prior firm, they said their gross payout was forty. However there were several ways to get deigned from that and get reduced and then as I look back then (I think it’s changed) but you paid half the phone and half the postage so your model blocked interview in this kind of stock is an example you got penalized. I didn’t do B shares but if you do the B shares you get penalized, etcetera. So the payout -- a lot of case -- was in maybe closer to thirty-six or something like that. Now if you got bonus and partner, it was in the mid-forties maybe. Here, depending upon your setup, I’m in a stand alone office, I’m currently the only advisor and I have two assistants: one has been with me for nineteen to twenty years, and the other one about three. Being in one office with one advisor pretty much set up like the other firm, so if I have an extra assistant my overhead is probably a little higher than somebody that plugs and plays into an office where there’s two or ten advisors. Economy’s a scale. Additionally I spend a fair amount in marketing and advertising. That is one downside I found is that probably most people do not know our firm. The clients are doing business with you, not necessarily the firm. But I would say I’m somewhere between 50% and 60%.

Sean: Yeah I think that’s a good guess, a good estimation. It’s funny, when I was first looking at all these options and talking to advisors I was shocked that most of us as independent advisors, we don’t have that number mount down because we look at it in terms of net income and all. But it’s just not a number that we worry about ‘cause we know it’s a lot higher once you’ve done all the math and no one causes a pretty report to say “oh you had a payout of this” because we know what our topline payout is and we get to decide how to spend that money, how to invest in the business, etcetera. And yeah, you’ve invested more than a lot of us in terms of having really good infrastructure and staff, comfortable space which suits your business well and you can grow from there as you’ve told me recently.

Brad: I probably do have a higher overhead and operating expense than the average being independent. One of the unique things is once you cover all of those base overhead expenses -- as an example, if I increase my revenue by fifty thousand, by hundred thousand, 80% of that probably goes in my pocket (or 90% of it at this point), once I’ve covered all those base expenses. So the payout can grow somewhat exponentially.

Sean: Right, it’s more like a real business versus at a traditional employee firm you’re always gonna give up half or at least or so, maybe more. But even as you grow you can give up a significant percent of your revenue whereas -- what I would call real business -- you have fixed expenses and once you’ve covered those then you have only some marginal expense, to each new client takes on a little bit labor maybe or some supplies or some of your time obviously. But I find that to be a huge huge concept as I look at going independent that it’s not so much the existing revenue, it’s whatever gross you have once you figure out model suits you, the marginal intact on your bottom line is impressive.

Brad: There’s an advisor that was at my prior firm and he has a pretty bare-bones office setup and yes, his payout is probably in the 70s net of his gross. So yes, it can be done.

Sean: Now if someone was listening to this and was considering their options or say “hey why should I leave?” You said maybe you only ended up in the early stages -- let’s say 50 or 60% of the assets that you had at the old place -- why don’t you tell us, if someone was considering that why would they make that move if you’re gonna take such a big hit? What’s the plan of all that work?

Brad: Good question. I think I got hit kind of a multiple times from various angles: the timing with the market going bad, I had some clients who were doing the headlight look and I didn’t know what to do, the one gentleman that had already been in my office so they are putting back in there, there were some familiarity I think some of the clients had, so I think that was a little bit of a downside. Also I had a big book of business. I think there were six office in town when I left and I had a bigger book in the other six put together by assets and I think number of accounts. So they came after me pretty hard, frankly doing the markets down turn of a way. I was frustrated, depressed and I think it kind of snowballs. I think in today’s market if somebody moves and is well prepared, they might say much higher number, maybe 80-90% of their business coming over. And especially if their business wasn’t as small (if it is big). If it’s a little smaller you might have a bigger proportion come over. So I think mine was a little unusual, they put several in my office, one that had already been there, the market really bad, etcetera. But again if you plug and play in an office and not try to reinvent the wheel, I think you get some help on how to shortcut to opening an account, to your processing the paperwork, etcetera. And somebody that’s already done this, I think in today’s environment, if I did it again I could probably usually move 80 or 90%.

Sean: Gotcha. And then since it’s been a while and obviously we’ve recovered from that market decline, talk a little bit about how your gross and net bottom line, how you compare to where you were at the peak of the market right where you left.

Brad: My production is probably (I don’t know) 40-50% since then, even though I got less clients and less assets. And it’s a lot more recurring, a lot more consistent, I might have to start from scratch everyday, every month. So I think that’s a good thing, having more services to offer was certainly a good thing. More ways to preserve clients’ money, more ways to reverse buy way from stocks and bonds. Those were some advantages that I frankly didn’t even use until full advantage. Interestingly enough, I had a client that was referred to me and he was getting a structured settlement from an injury. I had one of those at my prior firm but we didn’t do anything with him so I had to refer him to somebody. We can actually do those at our firm. Most people probably don’t even know we can do them. Somebody can build a whole career just on that. We’ve got advisors at this firm that build a whole career on doing nothing but setting up business retirement plans like 401(k)s. The freedom and flexibility, if you wanna be a start broker, if you wanna be a retirement plan advisor, you wanna go do something like work-structured settlement market. The scale and size of this firm being the largest independent in the country, I think is an advantage to somebody looking to make a change. I only wish I had done it sooner.

Sean: Agreed. I think it’s interesting to hear you tell that story because for someone who doesn't hear the rest of the story so to speak, they forget the part about the growth you had since the first six months or a year. All that growth again, the age of growing back and gone past your old revenue, again it’s higher quality in terms of how it falls at the bottom line. You’re able to pick and choose what clients you work with because you don’t have to take everybody to generate revenue because of the profitability. So there’s all these great things. I remember you telling the story the first time we talked about it. You seem disappointed with your transition but then looking backwards, I’ve never heard you sound like you regret it, right?

Brad: Correct, I was disappointed with my transition and it was frustrating. I think I could’ve done a better job. It’s turned out well. As I said I wish I had done it sooner. As I go around to our national meeting and regional meetings, I don’t know the number, but it seems like a significant part percentage came from my prior firm and most left after a year of three, or year of five, or year of seven, and they kind of look at me and go “probably it will take you fourteen to fifteen!” Maybe that wasn’t the sharpest knock from the door but it’s turned out to be a pretty good book of business. You know, unique lifestyle, own your business but you’re not after totally by yourself. It’s in a way like owning your franchise, you can make an analogy to owning Mcdonalds or whatever. So you got the help and assistance especially if you partner up or plug and play with some people. But you can control it, you can work as many hours or as little as you want, you can choose what type of investments, we have no preparatory products, nobody telling me what I have to sell or do yet I do have supervision which is a good thing, and plenty of ideas and assistance if i need it and have an advice from vendors than bend over backwards to help us. That’s another thing coming from my prior firm. I think we had six to seven preferred vendors when I left there. And really that was all I ever heard from and I would say couple of those were mediocre at best. Here, I just have to see through which ones I want to use because our selection and access to various third party money managers, mutual funds, annuities, things like real estate trust, business development companies that we didn’t even have at our prior firm, I just have to select which one of those I choose to use -- that I think best suits my client.

Sean: Very good. One thing I wanna touch on that you mentioned that’s interesting -- I made two moves which I don’t necessarily recommend but it worked out for me. I just stated that solution to episode one (If you haven’t listened to it, listen to it. That’s my story.) But one of the reasons I was happy looking backwards that I did those was that it was fairly easy to move my practice, right? Because it was a manageable size -- it’s bigger than it is was. And so part of what you just said, is it legitimate possibility from your experience when I’m describing that kind of move in a smaller book early in your career? Thinking about this from my perspective, it’s almost like my clients had less time to get attached to a particular place, whether that was Edward Jones or Morgan Stanley. I would think some of your clients got so comfortable, not only with you but sort of the Edward Jones model. You know, that’s just pretty powerful at some point. You think that’s a legitimate possibility that -- in that case the time with one firm -- constitute to some degree?

Brad: I do. I very much agree that it did, having an older book of business because I’ve been there so long. Clients resist change and people don’t like to change especially sometimes the older clients, which I had a book of retired clients, so they had change in the firm but I’ve been with and promoted very heavily for fourteen or fifteen years, change in location although I’m only a few miles away from my prior office. That was difficult. I think there was another advisor and from day one he’d preached that they were his clients. He just happened to work for that other firm. And he did a much better job of “you're my client” and when he left a bigger percentage of them went with him. So yeah, I think the earlier you leave is probably better. Now I do think you ought to have a book of business to be able to support yourself.

Sean: Right. And there’s a lesson on what you just said about that other guy. So maybe it’s the -- making sure once we know what we're doing we don’t have to oversell the brand that we’re with. Just as an insurance policy I always make sure we’re explaining that we try to sell the value of us, not of the brand. After that first couple of years where you kind of need some help sometimes but after that make sure you focus on that one-to-one relationship. That’s a great point.

Brad: And that’s the beauty of being independent. You can market yourself as your own brand, you can go under the corporate identity, you can co-brand. And lot of people choose to market their own logo, their own brand, their own identity.

Sean: Right and that’s probably a whole episode itself talking about those options, the pros and cons of each. One of the big concepts I want to ask you about is how much time do you spend running the business? Talk about the reality versus some of the ideas that people might have of all the things that a firm might do for you in terms of technology, and getting and keeping an office, and ordering supplies, or whatever the things that we kind of picture that it’s so valuable to have someone take care of. How much time do you really spend running the business? ‘Cause I think there are some scare tactics that would make people think “Oh, it’s too hard and you can’t do it Mr./Mrs. advisor.”

Brad: Well, I think some of that depends after covering from one of the major wirehouses like Morgan Stanley or Merrill Lynch because the firm is in somehow office building and that office book or the condition goes out the firm is taking care or building supervisors taking care of it. As opposed to being with prior broker/dealer that I was, or I was a stand alone office, I indirectly had to deal with the traditions broken, water leaks or something along those lines so a lot of big difference from that aspect from me moving. It may have changed a little bit over the years. Yes, you are running your book of business, you own your business, and I lease a space so there are things inside. If light bulbs need changing, I have to change them. But I did that at my prior firms so there are some time there are restraints, I guess, or constraints and I was forced, I have to pay the staff, or hire the book keeper. She figures that up I could later write a check, I write a check. About my office place I either send my assistants or I do it. Frankly I had to do that with my prior firm as well which is interesting. Out of it 40% of the prior firm were saying they were paying. If I bought pencils, pads, tapes staples, I paid for those at other firm so again, I had left 40% that they said they paid you. And here I write it off, it’s a legitimate operating expense and yet my netpay is gonna pay all of those. But yes, the day to day running of the business is a change you have to get used to. Again, I think that’s an advantage of joining a plug and play situation maybe where somebody else is already taking care of that. In my situation, I’m a stand alone office so if something needs taking out I gotta hire somebody to do it or I do it.

Sean: Right and I think the big lesson or concept that’s really important is that we get to decide those things -- from having two assistants or six to having zero or doing your own paperwork and we see all kinds of combinations in terms of what people wanna do and we’re able to change it if we decide it’s not working. If we need more support, less support, fancier offices, simpler offices, we get to put our own stop. To me that’s the true definition of being independent. I did an episode about that, sort of how to define -- what does being independent mean: hiring your own staff or not, picking where you work and what kind of tools you use. Those are big components of how you run the business.

Brad: It’s interesting. I’ve got two friends who have come from other firms that are at my current firm. One of them works out of his house. His business has asset probably half the size of mine but he doesn’t have any overhead and he loves it. He makes good living. I got another one two has a lake property. He could remote in from his lake house. Clients don’t even know he’s not in physical location. He can be out on his boat. He can be setting up on the patio. He works and yet he has office staff and the typical overhead so probably opposite concepts and yet both of them are doing very well and better than they did at the prior firm.

Sean: Yeah, and probably a lot happier given that freedom to create their own ideal business.

Brad: Much happier. Much happier.

Sean: Great. Brad, I really appreciate you taking your time to talk with me. Anything we haven’t touched on that you’d like to share? Or anything, if you had to do things over that we haven’t talked about, what would you do differently? Or anything else that you want to mention.

Brad: I would say just make a plan and work your plan -- visit some offices of the firm you’re looking to move to, ask questions, find out the pros and cons. I’m open to somebody calling or coming to visit me and I’ll try answering questions and share with them as best as I can to what I thought the pros and cons of making the move. Obviously mine wasn’t perfect yet I’m happy.