Basic Reality;

  • Recruiters get paid by someone else and therefore will push you to the highest bidder, period. Recruiters work for the firms they place you into, NOT YOU. There is no such thing as a “consultant” in the recruiting space, his compensation is based on where you go, period. The rest is BS. If you are not compensating the recruiter/consultant and he hasn’t signed a fiduciary agreement stating he doesn’t receive additional compensation (in any form, like 3 weeks in Hawaii) from anyone else based on your move then you’re getting sold. Do your own research, don’t be sold by someone else, especially a recruiter, BOM or a special “closer” in the home office, all of the wires have them. These people get paid huge salaries and perks and are very good at doing their job… ever buy a time share? If you did were you ever happy with your purchase? Be an adult.
  • Do the math, if you think you actually get to keep up front bonus money you have no right to call yourself a “financial consultant”. Consult a CPA (who has experience preparing tax returns for advisors who have taken the bait and not related to a B/D or recruiter). Ask what the forgiven interest rate on the EFL is and calculate the tax. Ask how AMT is applied to: 1. The EFL, 2. the forgiven interest on the EFL and 3. The combination of #1, #2 PLUS your gross. (if you don’t ask you deserve to get punished by a 7 year sentence with no parole) Ask to see a hypothetical illustration of your compensation, i.e.: bill 1mln in fees, what’s my AFTER TAX take home, what services are included and better yet, which ones are extra. Then ask what the exact same production looks like in years 2, 3 & 4. I’ve recommended this to several guys looking for the upfront, just to illustrate what big a chunk taxes take, none have either asked or the wires have refused to provide (they never saw it coming).
  • If you’re broke from doing the last three EFL deals and think that a 4th deal will “make you whole” then think again (what’s the definition of insanity?). Want to know why the 80 year old guy sits down the hall? Cause he’s probably broke and needs to supplement his Social Security… why is he broke? Go back to #2.
  • An IBD is just a smaller version of the wirehouse… if they are FINRA regulated life is no different… why would anyone think it would be?
  • Ask about your ability to trade away, make the street compete for your business, hold your transactional (commission) business away and not share the comp.

These are just some random thoughts, I’m sure you can help me put it all together.

Let’s talk soon,

Paul C. Spitzer

Founding Member

1201 Camino Del Mar

Suite 203

Del Mar, CA 92014

858.436.3862 direct

858.735.7285 cell

858.519.5557 fax

Recent Posts