Series 6/63 Question

[MaineMan]

For some time now I have been running into cases where mutual funds would play a role. Usually the clients do not have any retirement plans set up and now have money to start investing. The other area is with 50-65 yr olds who do not want to put all there money into annuities (and I agree) and are scared of the stock markets. Currently I refer them to a friend. Should I look into getting my 6/63? I know about sponsorship with a b/d and usually they have minimum production levels. Does anyone know of a b/d with low minimums? There is the saying "get control of there money and you control the house. What do you think? Do you have a 6/63?

 

[xrac]

You need to read this thread and the links posted in it. It will give you a lot of the pros and cons:

Insurance Agent vs Financial Advisor

 

[DHK]

For some time now I have been running into cases where mutual funds would play a role. Usually the clients do not have any retirement plans set up and now have money to start investing.

Have you considered non-registered group annuities? I'm sure there are some that can be set up for one person, but that person would need to be a business owner.

The other area is with 50-65 yr olds who do not want to put all there money into annuities (and I agree) and are scared of the stock markets.

Why do you think mutual funds would be appropriate here? Mutual funds are collections of stocks and bonds according to an investment style. They are IN the market.

Currently I refer them to a friend. Should I look into getting my 6/63? I know about sponsorship with a b/d and usually they have minimum production levels. Does anyone know of a b/d with low minimums? There is the saying "get control of there money and you control the house. What do you think? Do you have a 6/63?

I don't fully agree with your phrase. I would adjust to say "Whoever connects to and understands their client the most... wins." (or something like that)

I know that Ohio National will allow your life production to count towards their B/D production requirements.

But read the thread that xrac posted before jumping into this.

Remember, you're not just adding a B/D relationship to your practice. You're going to let your B/D run EVERY ASPECT of your insurance practice too. Every website you have, every advertisement, every promotion, outside business activities, compliance visits and inspections and depending on the B/D - some of your insurance recommendations - especially if you're dealing with FIA and EIUL.

The main advantage of getting your securities licenses is that once you let them go, you'll be grateful for what you had before you had them.

 

[patch36]

The only products I have ever sold that cost and lost money for my clients required the 6/63. Not one of my Fixed & Index Annuity customers have ever lost a penny and all have made money. If your client is 60+ they have no business in 6/63 products unless you want to gamble with their money and they have the money to lose. IMO, YMMV.

 

[pomfin]

Remember, you're not just adding a B/D relationship to your practice. You're going to let your B/D run EVERY ASPECT of your insurance practice too. Every website you have, every advertisement, every promotion, outside business activities, compliance visits and inspections and depending on the B/D - some of your insurance recommendations - especially if you're dealing with FIA and EIUL.

The main advantage of getting your securities licenses is that once you let them go, you'll be grateful for what you had before you had them.

That is right! The B/D dictates what you do, everything. And it is expensive to maintain the license, E&O insurance, Firm Element and other regulatory requirements.

 

[Y.L. Prinzel]

Remember, you're not just adding a B/D relationship to your practice. You're going to let your B/D run EVERY ASPECT of your insurance practice too. Every website you have, every advertisement, every promotion, outside business activities, compliance visits and inspections and depending on the B/D - some of your insurance recommendations - especially if you're dealing with FIA and EIUL.

The main advantage of getting your securities licenses is that once you let them go, you'll be grateful for what you had before you had them.

Listen to this, and think long and hard before do anything. I have a 2-15, 7 and 66 and just left Raymond James. There is NOTHING you can do without their compliance department weighing in on it. I could not write even the vaguest insurance and finance information until I left them or I would have to make my clients put the Raymond James hedge on them. As far as social networking goes--Twitter, LinkedIn. etc. and blogging, you will also have a big problem. Some b/d's actually forbid their reps or employees from mentioning them on certain websites. I'm not saying it's not worth it if you really think you are going to sell a lot in MFs (MF trails can be nice) but even still, most clients are probably going to want no loads which are...no loads :(

 

[DHK]

My first career was in banking at Wells Fargo. Being in banking, the next step was either bank management or going into investment services.

When I left the bank to go to American Express Financial Advisors, I thought I'd be "all that and a bag of chips" because I finally had the series 7 & 66 and my insurance licenses. I thought I could finally make a lot of money now.

That's what happens when you're indoctrinated by a bank as your financial career starting point.

I let them go as of April of this year. I have until April, 2011 to reactivate them, but I won't.

 

[Tom Highway]

Wow, this looks like a Top Gun reunion!

I was a "Dr Noah Wannabe" (hehe; some of you old TGP folks will appreciate that) with a certain "high net worth" securities firm based out ot Switzerland, and hated every minute of it. There are only so many people with $500k or more to invest that made it worthwhile for me to do what I did, and I washed out. Now, I can cold call for medicare supplements or final expense, and have some really great conversations with people who actually want to talk to me.

I'm with the other folks here - screw the Series 6/63. And do what DHK says about the annuity.

 

[DHK]

Well, I don't know who pomfin is or Y.L. Prinzel on TGP (if they're even there), but it appears that this thread and the other referenced thread all agree on a particular point of view.
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If there was enough PROFIT in it to make it worthwhile - THEN it could make sense.

I used to think there could be enough profit. But I really like annuities. I sold quite a bit of VA product before. Now I can make more money with less risk to the client and myself.

Now if only SEC 151a would just go away...
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One of the things I was really looking forward to was the marketing freedom.

It seems that B/Ds only allow certain vendors to let you use their marketing materials & web site services. These are highly priced and look the same as anyone else's.

I tell you it's a conspiracy against the reps! After all, the reps pay for this stuff, not the B/D. The B/D just "approves" it.

I wanted to use the VSA at my last firm. Website, newsletters and other materials they have. My firm said I'd have to submit everything to compliance. Well, after printing out over 100 pages, I decided to forget it. It just wasn't worth it for the time involved. I left the firm the next month.

And yes, I'm a happy VSA subscriber using the many services it has.

 

[Y.L. Prinzel]

Well, I don't know who pomfin is or Y.L. Prinzel on TGP (if they're even there), but it appears that this thread and the other referenced thread all agree on a particular point of view.

I should preface this with the fact that I was not an independent producer--I was an employee of RJ servicing their abandoned or "fired" clients. I have worked with a multi-million dollar life premium producer (selling 419 plans before the IRS decided to call them shelters) who was 6 licensed and had to deal with the audits etc. and the b/d was still a pain in the...well, you know. He was with a really small b/d and was one of their top producers, so we got a lot of leeway--but we still had to go back and forth a lot over the copy on sales materials. His b/d (Brookstreet Securities) is now defunct. He could afford to pay me to deal with it, which is a testament to the commissions--but he was selling whole life insurance to business owners in the old 419 plans. Without the tax benefit, I'm not sure he would have done quite as well (but then, I'm not a producer, so maybe he would have). Also, in order to get the agents who sold our plan on board we had to deal with Woodbury and other b/d's and get all materials approved through them as well. It did not make the boss happy and he was always shopping around for a new potential b/d. Personally. I don't think that would have solved the problem at all.

If you are not going to sell variable products and are thinking about selling a few mutual funds on the side (which is what OP seems to be thinking) I again say that it is not worth it. You have to do what you think is best, of course, but if you can't hire someone to deal with the compliance aspect I don't think it's worth it. If you are going to start selling securities, get the 7 and have at it. Variable products--since I'm not a producer I wouldn't know whether there is or isn't a demand.