A lot of people who join real estate companies because of "profit sharing" or what another company refers to as "residuals" aren't doing the math. On the surface it all sounds great and wonderful, but what about the reality of it.
Hello everyone. In this post I'm going to talk a little about some of the "profit sharing" systems some real estate companies use to recruit and retain associates.
Those of you who know me understand that I typically don't knock what other companies are doing. I've always felt that there's something for everyone. What appeals to one person about a company might not appeal to another.
Here's the thing. I think that a lot of people who join real estate companies because of "profit sharing" or what another company refers to as "residuals"Â aren't doing the math. On the surface it all sounds great and wonderful, but what about the reality of it.
Most of these profit sharing incentives revolve around you recruiting new people into the company. This is of course great for the company, but how great is it really for the associate?
Let's first look at the commission splits. Lets example a good associate broker earning sixty thousand per year, which by the way is significantly above the average let alone what a new associate might earn. In the course of a year that associate will pay about eighteen thousand of that to the company.
Compare that to the six thousand they would pay to a structure like my company, Rose Real Estate. We're talking about a twelve thousand dollar difference. What do you get for that? You get to recruit more people into the company!
Now, when you do recruit other associates and if and when they start to make money, you get a percentage of the net profit. If this recruit also makes sixty thousand, again, which is against the odds, out of the company's eighteen thousand, how much of that do you think you'll see?
Don't you think in the long run you'd create more wealth, FOR YOURSELF, by taking that twelve thousand dollar difference and buying an investment property? I certainly think so. Also, if you had the skill to recruit enough people into a company that maybe you should start your own? How much more wealth would that create for you?
Like I said, there's something for everyone. But, before you make a decision about what company to work for. Please, explore your options. And do the math! If you're interested in learning more about Rose Real Estate LLC, please visit http://roseusa.com
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