Do you ever feel like a mystery surrounds the inner workings of Keller Williams Profit Sharing? You’re not alone! For many real estate agents, understanding exactly how profit sharing works and their responsibilities can be confusing–but it doesn’t have to be. In this blog post, we’ll explore the ins and outs of Keller Williams Profit Sharing so you can make strategic decisions that best benefit your career. So let’s get started unraveling the intricacies of this mysterious topic!
Keller Williams is one of the largest real estate brokerages in the world, and they offer a unique profit-sharing program that can benefit both agents and the company. In this blog, we’ll take a closer look at how Keller Williams Profit Sharing works and the benefits of participating in the program.
What is Keller Williams Profit Sharing?
Keller Williams Profit Sharing is a unique program offered by the Keller Williams real estate brokerage. This program rewards agents with a share of the profits from the brokerage’s market centers. This means that agents participating in the program can earn a portion of the profits from the agent’s office that they sponsored into Keller Williams.
The profit-sharing program is designed to reward agents for attracting and referring talented, productive agents to the company. It’s also a way for Keller Williams to incentivize agents to continue to help other agents produce at a high level. This program is unique in that it rewards agents for the collective efforts of the entire brokerage.
How Keller Williams Profit Sharing Works
Keller Williams Profit Sharing is a unique program that rewards agents with a share of the profits from the brokerage’s sales. The program works by taking a percentage of the profits each month and distributing it among the participating agents. The profits are distributed according to a predetermined formula, which considers the contribution to the company dollar by the sponsored agent in a given month, the profitability of the specific office, and the agent’s position in the sponsor’s seven-level tree.
To participate in the program, agents must have an agent join Keller Williams and name them as a sponsor in the system. Each agent that joins the company is required to name a sponsor. Sponsorship has sometimes been compared to the procuring cause structure in a real estate transaction. The sponsor does not have to be in the same office as the agent that joins. Once the agent joins and contributes company dollars to an office in a given month and is profitable, the profits are distributed according to the predetermined formula.
The Benefits of Keller Williams Profit Sharing
Keller Williams Profit Sharing is a great way for agents to make extra money and increase their earnings. This program rewards agents for helping to attract talented agents to the company and their hard work and dedication to the company, and it’s a great way to incentivize agents to continue to perform at a high level. The program also encourages agents to work together and collaborate on projects, which can lead to more successful transactions and higher profits for everyone.
The program is also beneficial for the company, as it encourages agents to bring in more business and helps increase the company’s overall profits directly or through other agents joining the company. It’s a win-win situation, as both the agents and the company benefit from the program.
At Keller Williams, we do things differently when it comes to promoting our company: instead of spending millions on ads – like our competitors – we use our associates as walking billboards. That way, we can reinvest those funds in the associates themselves by providing them with training, educational opportunities, support, and modern technology. Because each residential sign in the front yard or positive word from an associate spreads throughout a community like wildfire, these practices have become an effective way to ensure an individual’s–and the public’s—clear understanding of what KW stands for. Our unorthodox approaches have put us at the forefront of real estate companies everywhere and are even stretching around the globe into new markets!
How to Qualify for Keller Williams Profit Sharing
When a person names an agent as their sponsor or the associate who introduced them to the company, they enter the first level. Each sponsor receives 50% of the profit attributable to the profitable activities carried out by the associates they recruit. And, while the percentages decrease as you progress through the levels, they never fall below 5%, which is higher than the top tier of other wealth-building systems in the industry.
This is how it works:
- When transactions close, KW associates who have not yet met their cap pay company dollar to their market center.
- The market center uses this money to cover operating expenses. What remains is profit, and unlike other companies, a portion of that profit is distributed to the associates who assisted the company in growing by bringing on productive agents.
How Much Money Can You Earn Through Keller Williams Profit Sharing?
The amount of money an agent can make is also determined by the predetermined formula used to distribute the profits. The formula considers the place in the seven-level tree and the contributions of the sponsored agent to that month’s office profitability. If the sponsored agent is capped for the anniversary year, then no profits are distributed to that tree branch until the reset occurs on the following anniversary date.
Over the life of the profit share program, a number of associates have received cumulative six and seven-figure payout from the profit share system over the years.
Since the program’s inception, KW has distributed more than $1 billion to associates who have contributed to the company’s growth!
Strategies for Increasing Your Profits with Keller Williams Profit Sharing
Agents can use a few strategies to increase their profits with Keller Williams Profit Sharing. One of the best strategies is to focus on being a great agent and an example to other agents in the marketplace. This means taking the time to understand the local real estate market and finding ways to make the most of it. Agents should also focus on building relationships with the other agents involved in their transactions and developing a strong professional reputation.
Another good strategy is to invite other agents in the marketplace to explore the Keller Williams training offerings, including offering for them to attend the BOLD sessions when they are held in the agent’s area.
Keller Williams Profit Sharing FAQs
Q: What are the benefits of participating in profit sharing?
A: Participating in profit sharing can benefit both agents and the company. For agents, it’s a great way to make extra money and increase their earnings. For the company, it encourages agents to bring in more talent and business. This helps to increase the company’s overall profits.
Q: How do I calculate my share of the profits?
A: Your share of the profits is determined by a predetermined formula that considers the individual offices’ profitability and how the sponsored agent contributed to that month’s company dollar. The profits are then divided among any agents who are eligible to participate in the program.
Q: How long does it take to receive Keller Williams Profit Sharing?
A: If an agent names you as their sponsor and they sell a home during the first month that they are with the company, and the office is profitable, then the sponsor can get paid the following 21st of the month. It can be that quick.
What Are the Benefits of Participating in Profit Sharing?
Participating in profit sharing can be beneficial for agents and the company. For agents, it’s a great way to make extra money and increase their earnings. It also encourages agents to work together and collaborate on projects, leading to more successful transactions and higher profits for everyone. Agents are also empowered as stakeholders in the office and encouraged to help the office manage expenses.
For the company, profit sharing encourages agents to bring in more business and helps to increase the company’s overall profits. It’s a win-win situation, as both the agents and the company benefit from the program.
Keller Williams’ profit sharing system employs a vesting program, which means that agents who have been with the company for seven years will continue to receive profit share income for the rest of their lives. The agent’s heirs will then have full rights to that passive income stream for the rest of their lives. It’s a present that keeps on giving!
It is a true gift that you can pass down to future generations. All because you referred new agents to KW. This program embodies the Keller Williams culture by treating all associates as family. It fosters a culture of giving back, giving all associates a vested interest in helping those around them. The agent next to you is viewed as a resource rather than a competitor.
How to Calculate Your Share of the Profits
Each month, the Market Center Administrator(MCA) of each Keller Williams office will “close the books” for the month and calculate the profit for the office.
They will look at the following factors.
The Total Amount of Company Dollar collected by the office for the month. This is the office’s Income. They will also account for the percentage of the total company dollar that each agent contributed during that month.
They will record the total expenses for the month.
They will subtract the expenses from the income; the remaining will usually be profit.
Next, your Market Center will divvy up the profit so that roughly 52% goes to your Center’s owner, with the remaining 48% going back into the real estate agents’ pockets via profit share. How this overhead is distributed is broken into three levels:
- Level 1 (Up to $2,990): 25% goes to profit share, 75% goes to owners
- Level 2 (The Next $8,250): 35% goes to profit share, 65% goes to owners
- Level 3 (Over $11,240): 50% goes to profit share, 50% goes to owners
This calculation ensures that the financial owners of the office are rewarded for their initial financial contributions and risk before any distributions occur to agents in the profit share system.
If the agent you sponsored contributed 10% of the company dollar collected in the month, then 10% of the profit pool will be distributed to you and your tree in the following manner.
Here are the seven levels of the tree and how levels distribute these funds.
- 1st Level: 50% to you
- 2nd Level: 10% to your sponsor and so on up the tree
- 3rd Level: 5%
- 4th Level: 5%
- 5th Level: 7.5%
- 6th Level: 10%
- 7th Level: 12.5%
These funds are distributed on the 21st of the following month.
The more agents you refer to Keller Williams Realty and the more new agents they sponsor, the larger your potential direct deposit will be each month.
What Are the Requirements for Participating in Profit Sharing?
All associates are eligible to participate in profit sharing. Those who do so are financially rewarded for bringing in other talented, productive agents by receiving a share of the office’s profits. It is a genuine, no-investment opportunity to generate passive income simply by informing other agents about a career at KW.
After seven years with Keller Williams, you are vested; your profit share distributions will continue to roll in as long as the associates you sponsored down your seven levels continue to contribute to the market center’s profit. You do not compete or recruit against Keller Williams. And, if you choose to stop production, the checks will come, and your profit share tree will continue to provide shade for future generations.
Keller Williams used to provide lifetime eligibility for their profit share program for anyone that had been with the company for three years. Some individuals continued to collect profit share, even when they went to other companies and recruited against KW. This plan was discontinued in 2020. Any real estate agent who joins after 2020 will only be eligible for the profit share plan if they continue to work for Keller Williams or are vested and do not compete with the company.
How Long Does It Take to Receive Keller Williams Profit Sharing?
Agents can receive a profit share the following month after they join if they meet all of the system’s requirements.
Even if you have not taken your required real estate classes to become a realtor as of yet, this explanation will show you why Keller Williams Realty is the company you should consider when you pass your exam.
Keller Williams Profit Sharing is a great way for agents to make extra money and increase their earnings. This program rewards agents for their hard work and dedication to the company, and it’s a great way to incentivize agents to continue to perform at a high level. Participating in the program can benefit both agents and the company, and it’s a win-win situation for everyone.
If you’re an agent looking to make the most of your hard work and dedication to Keller Williams, then the Profit Sharing program is a great way to do it. Just make sure you qualify for the program and understand how it works, and you’ll be well on your way to making the most of this unique opportunity.
Now that you know how Keller Williams Profit Sharing works and the benefits of participating in the program, you can start earning more and increasing your profits with the help of this unique program. So what are you waiting for? Start taking advantage of this great program and start earning more today!