Financial planning as a career

January 17, 2006 8:11 PM

How can I become a financial advisor or planner? Is it prudent for me to consider entering this field at the age of thirty?

Yesterday, I was reading an article about financial planning that I'd printed out, and my husband observed "you spend way more time reading stuff like that than you do reading anything related to your own job. You should go into that field." And you know, he's right, I am very interested in this area.

How feasible is it for a 30 year old to begin getting into the financial advice or planning field? Are there many jobs in this area? Does it pay okay? Given that I'm not an 18 year old considering this path, what are the most prudent steps to take or skills would I need?

I'm Canadian, if it matters, with an economics degree, although my current job does not directly use it. (Anonymous because other people at work occasionally read this page).

posted by anonymous to work & money (7 answers total)

You most certainly are not too old. My father has been in this field for a number of years, and says that people of all ages come into it, and often someone starting as a second career will get up to speed a lot quicker than the younger ones.

You may want to start with the Canadian Securities Course. It consists of two exams. And once you have your feet wet, move on to the Certified Financial Planner designation, which is more geared to that specific field. That's really all you need to get your foot in the door as a financial planner. Keep in mind that these are largely commission sales positions. Companies like Clarica and London Life I think start you out with a base salary plus commission, but after a couple of years it is 100% commission. If you can get into the banks, I believe they provide the clients, so you don't have to run around drumming up your own business.

Due to the competitive nature of the position, and low barriers to entry, there's a lot of turnover. So if you show a sincere interest by enrolling in the above courses, you shouldn't have a problem. And I also see you have an econ degree, so much the better. Go to a recruiting event for Clarica or a similar company (do NOT work for Primerica, trust me on that one). Talk to some people doing those jobs, they should be able to deny/confirm the above and give you any more information you need. Good luck!
posted by Idiot Mittens at 8:38 PM on January 17, 2006 [1 favorite]

My brother's became a CFP at around age 40. He's now 53 and is self-employed as a planner/portfolio manager. He'd previously been a programmer/project manager. He started the transition part-time before leaving his last job so it's hard for me to say exactly how long the process took but overall I think a few years.
posted by TimeFactor at 8:52 PM on January 17, 2006

30 is young for this sort of work - if you want to do it, go for it. From what I know, Idiot Mittens is completely right here. (Best answer!)
I'm a registered rep in the States, but I don't have any retail clients.
posted by sachinag at 9:35 PM on January 17, 2006

I'm a 29-year-old with an English degree who was hired at a financial planning firm as a temp receptionist and got fast-tracked to paraplanner (and subsequently on the road to full-on Financial Planner) because I was smart, caught on quickly, and had the right demeanor. Sometimes it takes no practical connection to finance at all - just right place/right time. The youngest person in the firm is 23, but we had the same job within a year. So, no... 30's a fine age, and your background can be almost irrelevant if you've got a good head on your shoulders and a willingness to put yourself out there.
posted by mykescipark at 9:40 PM on January 17, 2006

I have worked in the field (fee-only) and found that it was actually easier for our advisors that were in their 30s and above to get clients - there seems to be a sense that younger advisors are too young to understand "your" concerns. My favorite part of my job was the educational aspect, and the look of surprise that I received from clients (I was 21 at the time) that I would understand their needs and goals was frustrating to say the least. Good luck. It was a very rewarding job overall.
posted by blackkar at 5:58 AM on January 18, 2006

I'm Canadian, and married to a financial consultant on his way to becoming a Certified Financial Planner. I don't work in the field myself.

Age -
Thirty seems to be a good age to enter this field. As others have said, if you're too young it's more challenging to establish credibility with prospective clients. You also have the advantage of having a larger social network to draw on for contacts and potential clients than a younger person would. This is an industry that relies heavily on referrals, so knowing lots of people in different social circles and industries is beneficial. You're also still young enough that you can tell clients that you'll be around for a long chunk of their career and/or retirement. Continuity of service can be a selling point, too.

Jobs -
There's a lot of financial consultants out there, but there's a lot of people that could benefit from their services (it's not only for high net worth people).

Many of these jobs will be self-employed even when you're working under the umbrella of a well-known name (Investors Group, Clarica & Edward Jones, for example) however if you work under one of these sorts of organizations, you get training and support so you're not out there on your own and you get to be your own boss. Banks also have financial consultants and/or Financial Planners. There you have the security of being an employee and the ease of having clients handed to you, but not the freedom to be your own boss and not as high of earning potential (AFAICT). Where is a good fit for you depends on your priorities.

Pay -
There is the potential to make lots and lots of money in this field. How much depends on if you're fee-for-service or commission-only, where you work, and on how much business you write. It seems like you probably won't make much for the first few years, but the ceiling nearly non-existent and if you're good it doesn't take long to make good money - but you have to invest a lot of time and work and you have to be able to get through the first lean years.

My impression is that the people who do the best give up a lot of "family time" while they're getting established - working nights and weekends etc. You can make a living without doing this, because when you're self-employed you have the freedom to set your own hours, etc. But our experience has been that your earnings will reflect how much you're working. This gets better once you're established because the more clients you have, the easier it is to get referrals, and the more work you'll be doing without having to "hit the pavement" as much to find it.

The other wives have told me "it's hard for the first few years to be at home with the kids all the time while he's working, but it's worth it. Think of it as an investment." If you have kids, this may be something to consider. How much money do you want to make? How much money do you HAVE to make? Are you willing to give up family time for a while in order to make better money?

Skills -
It's possible to learn a lot/most of it "on the job". Some companies allow & encourage this, while others don't want you until you've got experience. (But once you're licenced everyone courts you). You have to have the right personality for it, too. You'll be meeting new people so it helps to be outgoing, for example.

How to start -
Depends on what you actually want to do. The Canadian Securities Course is good, but it may not be neccesary if you don't want to trade in individual equities. If you don't want to trade in individual equities, you can get mutual funds and insurance licences (Life Licence Qualification Program LLQP is one route for insurance) without ever taking the CSC and then work towards your CFP. (Of course, the CSC is one option).

Each province has their own licencing body, so the exact deails vary somewhat. Generally, for each licence you take a self-study course and then an exam. If you pass the exam, you are eligible for the licence, but you must have a recognized organization - like the ones mentioned above - to sponsor you in order to actually get the licence. This may not apply in Quebec. As with most things, Quebec has their own set of rules.

So you could start interviewing financial companies now, looking for one that you feel comfortable with their approach, and once you find the right company ask what courses they expect you to take. Those courses you could take while you're still working if you want to, then you could make the switch and work towards your CFP while you're working in the industry.

Both my husband and I would be happy to talk to you more if you have other questions. E-mail is in the profile.
posted by raedyn at 10:25 AM on January 18, 2006

A few months ago I was in the market for a new job, specifically an IT job. I posted a resume on a couple of job sites. I got a message from I think it was Merrill Lynch. They wanted to talk to me about taking a financial planner position. My resume had nothing but IT stuff on it, I have no experience with financial planning or anything in banking. I wasn't interested and never followed up. So experience wasn't a big deal with them obviously.

I suspect it would have been nothing more then a "sales" position where you are just trying to sell Merrill Lynch products and that is the main goal rather then actually maximizing the clients profits. But it may be a good way to get your foot in the door.
posted by Justin Case at 10:59 AM on January 18, 2006