Working Out of a Home Office As a Financial Planner?

[BiggitySwat]

I am a fully licensed financial planner that gets most of my leads from seminars and referrals. I have great clients, but I feel that something is going against me when dealing with some interested prospects.

I work from home. I have a home office that looks VERY much like a humming office inside, with its own separate door, ramp, walkway, railing, etc. leading to the entryway. However, it is part of a wing of my house. I have seen a few clients in the home office before and it was okay, but I have a little problem with some of my prospects.

Some of my prospects from seminars are medium to high net worth folks who currently have a financial advisor with a wirehouse. Though they would like to make a change from their advisor for a variety of reasons, I feel embarrassed that I work out of a home office while the wirehousers work in supertowers plated in mahogany. I have an itching feeling that being a solo practitioner with a part time secretary from home hurts my credibility.....

I have thought about leasing my own office, but I don't want to since my practice is fairly new and the expense to lease is insane (in my area). I love the flexibility, convenience, and afforadability of a home office environment, but nonetheless feel kind of embarrassed to invite prospects to my home to talk about retirement planning!

For those of you in my position, did you just bite the bullet and get an office, or did you somehow make the home office thing work while not looking like a small-time amateur to your prospects?

***PS: So far, I have been meeting my prospects at local banks whom I have relationships with, coffee shops, their homes (most common), etc, but I get asked MANY MANY times where my "office" is.....and I get tonguetied.

 

[GetInsurance]

You need an office. My brother is in the same business as you and was also working out of the home when he first started. He was introduced to a wealthy prospect by a happy client or customer, whatever you guys call it, and didn't get the guy to invest. He was told later by the guy sending him the business that the wealthy guy didn't feel right about writing a huge check to somebody who wasn't in a credible office. My bro got a nice office the following week and never looked back. The same guy who didn't go through my bro ended up with him a year later, transferring all assets for management. I work from home and in my line of work it's great, but I wouldn't hire a financial planner who worked from home and you probably wouldn't either.

 

[Ranger]

In our area we have a couple of businesses that make a business of providing office space. I can get an office with internet connection for $275 per month. Included in this price is a receptionist up front and a couple of conference rooms to use for meeting clients. I don't have to sign lease, I don't have to clean the rest rooms, and I don't have to pay any utilities (unless I want my own phone line). Plus I don't have to bothered by the city zoning board for running a business out of my home.

You might want to look around for a place like this.

 

[insuranceexec]

I am a fully licensed financial planner that gets most of my leads from seminars and referrals. I have great clients, but I feel that something is going against me when dealing with some interested prospects.

I work from home. I have a home office that looks VERY much like a humming office inside, with its own separate door, ramp, walkway, railing, etc. leading to the entryway. However, it is part of a wing of my house. I have seen a few clients in the home office before and it was okay, but I have a little problem with some of my prospects.

Some of my prospects from seminars are medium to high net worth folks who currently have a financial advisor with a wirehouse. Though they would like to make a change from their advisor for a variety of reasons, I feel embarrassed that I work out of a home office while the wirehousers work in supertowers plated in mahogany. I have an itching feeling that being a solo practitioner with a part time secretary from home hurts my credibility.....

I have thought about leasing my own office, but I don't want to since my practice is fairly new and the expense to lease is insane (in my area). I love the flexibility, convenience, and afforadability of a home office environment, but nonetheless feel kind of embarrassed to invite prospects to my home to talk about retirement planning!

For those of you in my position, did you just bite the bullet and get an office, or did you somehow make the home office thing work while not looking like a small-time amateur to your prospects?

***PS: So far, I have been meeting my prospects at local banks whom I have relationships with, coffee shops, their homes (most common), etc, but I get asked MANY MANY times where my "office" is.....and I get tonguetied.

The problem you are experiencing is all to common. I can not tell you how many people feel more comfortable having a professional with his or her own office. I can also understand your point of view; assuming you do not have kids crying and dogs barking.

I have had an office since I started my practice many years back. I picked up a guy this week for this very reason.

A guy walked in to my office and asked my secretary if someone was available to meet with him for a few moments, and apologized for not having an appointment. To make a long story short; the guy was uncomfortable that his broker was working form his home, even though the broker was doing a good job. I transferred the account in "like kind", for inquiring minds, and picked up a 600K account.

With all this being said; go get an office. BTW where are you located?

 

[Bob_The_Insurance_Guy]

There are a great many Financial Planners, Insurance Agents, Consultants, etc. who work out of their house and rent space in a leased building (as stated earlier). It's done all the time.

They all have clientele who meet them either at a restaurant, their offices or at the meeting room at the leased space building.

 

[Winter_123]

I think the key here is that we are talking about a financial planning scenario. If you are out pounding the turf every day doing business to business or FE, it is probably helpful to not have an office to be hanging out in (provided that you are self-motivate). Will you lose some sales for not having an office in that type of business? Yes. But you will lose some sales if you wear a tie and some if you dont. But I am agreeing that with a financial planning versus transaction based businesses where a sit-down analytical session is more critical that a proper environment should lead to a payback of office expenses at a minimum.

 

[djs]

Lots of variables, though lets start with most broker dealers require true office space. Once you get past that, there is perception.

There is nothing wrong with working out of your house, as long as your house is on the upper end of your target market. If you have a $250,000 house and are trying to attract clients in $750,000 homes, forget it, it won't work. If you have a $1,000,000 home, trying to attract clients in $500-750K homes, it will work.

People want to know you are successful. The office creates this illusion. The home requires it to not be an illusion, but reality. Most of the time, reality is much harder than the illusion.

The other part of this is the office has to be an office, not a spare room in the house. Sounds like you have this setup.

However you do it, you will lose a few clients due to working out of the house. This is probably more true today than previously with all of the scams that are coming out, people feel a bit more uneasy about things that appear less secure.

If the loss of those few clients is greater than the expense of renting an office, then its time to get the office. Pretty simple really.

Personally, the office I have in my home is far nicer (even in a clients eyes, much less mine) than my official office. Of course, I can't do broker/dealer client work at home, since it's not an official registered address, but my office is less than a mile away.

My investment clients are always welcome to come to my house. Friday afternoons in the summer, we'll sit out back and drink a nice glass of a local winery's product.

Dan

 

[arnguy]

I think "Ranger's" suggestion is on the money. In most large metropolitan areas renting the office space on an "as needed" basis that is shared, with a receptionist, works great. There are quite a few of these deals in the Philly area and there probably are some where you live.

 

[saieddie]

Bite the bullet and get an office, even if it is small.
Unless I was dealing with a friend, I'd be leery of any financial planner working out of their home - I don't care how nice the home is.

 

[BiggitySwat]

Lots of variables, though lets start with most broker dealers require true office space. Once you get past that, there is perception.

There is nothing wrong with working out of your house, as long as your house is on the upper end of your target market. If you have a $250,000 house and are trying to attract clients in $750,000 homes, forget it, it won't work. If you have a $1,000,000 home, trying to attract clients in $500-750K homes, it will work.

People want to know you are successful. The office creates this illusion. The home requires it to not be an illusion, but reality. Most of the time, reality is much harder than the illusion.

The other part of this is the office has to be an office, not a spare room in the house. Sounds like you have this setup.

However you do it, you will lose a few clients due to working out of the house. This is probably more true today than previously with all of the scams that are coming out, people feel a bit more uneasy about things that appear less secure.

If the loss of those few clients is greater than the expense of renting an office, then its time to get the office. Pretty simple really.

Personally, the office I have in my home is far nicer (even in a clients eyes, much less mine) than my official office. Of course, I can't do broker/dealer client work at home, since it's not an official registered address, but my office is less than a mile away.

My investment clients are always welcome to come to my house. Friday afternoons in the summer, we'll sit out back and drink a nice glass of a local winery's product.

Dan

I do have a nice home, but it's still a home (lol). My home office is nicer than many wirehouse brokers' cubicles, yes, but the nose crinkling still occurs when talking to prospects about where I work.

My broker dealer allows me to work from home and send all of my correspondence to my house.

I have been thinking about possibly talking to my CPA and/or mortgage broker about paying them a stipend to use their spare office space as my client consultation cave, and in addition to paying a small fee, refer them clients that need their services. Have you heard of this working before?
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In our area we have a couple of businesses that make a business of providing office space. I can get an office with internet connection for $275 per month. Included in this price is a receptionist up front and a couple of conference rooms to use for meeting clients. I don't have to sign lease, I don't have to clean the rest rooms, and I don't have to pay any utilities (unless I want my own phone line). Plus I don't have to bothered by the city zoning board for running a business out of my home.

You might want to look around for a place like this.

I was recommended by a friend from LPL to look into joining a private club downtown. I've seen it, and it is very swanky and classy, and they'll allow you to use their conference rooms for clients. However, I may get in trouble if I tell prospects my office is in a private club - not sure if I can truly say that office space "is THE office?"