How to be a financial advisor

March 21, 2007 1:46 PM

I want to be a financial advisor. Now what?

I'm graduating soon with a degree in finance, and I would like to build a career as a financial advisor/planner.

What are the steps I should begin to take to prepare for my job hunt?

What are some good companies to work for?
Is it worth taking a job at a firm I am not excited about just to get the necessary licensing?
What are the drawbacks of the job?
What is the best way to find job opportunities? Most corporate job websites are almost worthless and seldom get anywhere.

posted by blueplasticfish to work & money (10 comments total)

Have you had any internships? That's the ticket to these sorts of insider jobs.
posted by M.C. Lo-Carb! at 2:14 PM on March 21, 2007

There are two tracks: Either you get a PhD in economics, or you get experience in finance. Those are the two main options.

If you are graduating in May, you need to get your ass moving. Get an analyst job. Easier said than done, I know, but make sure they have good training. Look for big financial institutions. You need to get the quantitative experience. Take their training, learn how to do their job. Then switch out to something client-oriented, like work for a wealth management shop. Most big financial services companies have departments that do this.

This is where you will develop the relationships with rich people. You will also learn the quant side of asset management. When you strike out on your own to make your investment consultancy, these are the guys who you will pull, because they will trust you. Trusit is important in these relationships.

On second thought, this is if you want to be an investment consultant, which is basically like a financial advisor, but with better results and higher fees. Could you be more specific about what exactly you want to do?
posted by OldReliable at 2:36 PM on March 21, 2007

I work in a completely different side of the industry, but with an undergraduate in finance, I think your best bet is to get a job with a reputable firm, put in your time cold-calling, pass all your tests, and make the connections and put in the time to work your way up the ladder, maybe moving companies when your old bosses offers you a job at a new place.

And in the meantime, you might want to think about going to school while working and getting your MBA. Everyone's got an undergrad in finance.
posted by mckenney at 2:37 PM on March 21, 2007

Not sure if anythings changed, but after college I had answered wanted ads for FA work which were set up as recruiting classes for American Express and other credit/insurance companies. The basics seemed to be to build your own client base and receive a commission. I know some states require licenses to advise and sell and market securities. I have a friend who is a recruiter for FAs for an international bank and says you get hired based on your existing client base. So basically motivation to build a group of high net worth individuals as clients, constant marketing and then of course people getting pissed if you give bad advice. Not really answers, but what I know from looking into it 6 or 7 years ago.
posted by jeffe at 2:38 PM on March 21, 2007

I would ask if you were actually interested in selling products before sending you on cold call interviews. My first job after getting my BA in Finance was working for a Fee Only Financial Planner (I knew I never wanted to sell products and this was a perfect fit for me - in essence you sell yourself as a product instead). They wanted me to get my CFP Certification and become an Enrolled Agent with the IRS. If you are interested in selling products, you will need to work with the types of firms listed above to get your series 7, 9, etc. You have to be sponsored before they allow you to set for these exams. If you are interested in Fee Only, drop me an e-mail and I can recommend some starting points (or at least people willing to mentor) in your area.
posted by blackkar at 3:00 PM on March 21, 2007

My brother is a financial advisor with a major company. He has a business degree and fairly long experience in sales (~20 years before going into financial advising).

I remember a few things he talked about when he first started. First, they told him he needed a *minimum* of 200 contacts in his local personal phone book (i.e. people he knew personally) to get started. I think this is based on the knowledge that a high percentage of the people will turn you down outright, but a few will pass your card along to someone else. With 200 contacts, you have a hope of getting started.

Also, he made almost *no* money until he was certified, and had to work 80-100 hour weeks in the beginning to get started. It tailed off eventually, but that was after two or three years. He probably averages 50-60 hours a week now.

He is a hardcore salesman and a highly motivated go-getter. If you are not extremely high energy, this might not be a good career.

Like I said, he works for a pretty well-established national firm. YMMV.
posted by Doohickie at 3:03 PM on March 21, 2007

Oh, and.... he doesn't necessarily just take people who have a lot of money; in fact, he does a lot of financial planning for public school teachers. I don't think too many people have a lot of "relationships with rich people".
posted by Doohickie at 3:08 PM on March 21, 2007

Read everything Nick Murray ever wrote. Seriously, if you see him at the grocery store, and he accidently drops his shopping list, pick it up and treasure it as if it were the Dead Sea Scrolls.

This is also a good place to start, as is this. Industry mags worth reading are here, and here.
posted by Kibbutz at 7:14 PM on March 21, 2007 [1 favorite]

What Kubbutz said. Seriously.

Check out the forums at the last 2 sites he/she mentioned -- others have asked the same question and gotten many many answers.

There are many paths, just choose a good one. My brief input is to be independent. Perhaps dip your toes in by working with older/experienced advisors while you learn the ropes. It's easier to build a book (and the lifestyle you may want) by associating with successful advisors than by cold prospecting. Now, if you want to be a rainmaker/cold-call-cowboy... then go for it.

Recruiters will tell you anything.
posted by powpow at 9:26 PM on March 21, 2007

Sorry Kibbutz...

Also, don't misspell stuff. People won't want to give you their money if you can't write.
posted by powpow at 9:28 PM on March 21, 2007