The How To Guide for Becoming a Financial Planner

This is a guest post by Dave Grant of Finance For Teachers.  

Being a financial planner I get asked all the time how others can get started in our business.  I’ve shared on the blog before how I got started, how I became a CFP®, and what it takes to become a successful financial advisor.  Many of you have appreciated those posts – Thank you! 

On Twitter I caught wind of another advisor that recently started his own RIA firm (like me).  He even chronicled his journey in Financial Planning Magazine.  I loved his openness and honesty in those pieces that I decided to ask him to share his journey on the blog for others that are interested in becoming a financial planner. 

Dave Grant is a fellow Certified Financial Planner™ like myself, loves soccer and extremely proud that he taught his young son how to pee standing up (I can relate!).  He’s a cool dude and I’m excited he took the time to share his story below. 

Enter Dave…

*****

become a financial planner

Firstly, thank you for reading past the title itself. This piece is not for everyone, but if you’re looking to become a financial planner, then you NEED to read this.

I’ve been thinking about how to write this blog post and how to put my six years, two jobs, countless hours of planning, and setting up my own company into an interesting format and one that helps readers. Through my condensed career story, you’ll get to experience the start of the “financial planner” journey, what jobs can be like, how to launch your own company, and all the parts in the middle:

Back to the Beginning

Let’s jump back to 2005. Having come over to the USA to work in outdoor education for six months after I completed my degree in England, I found out that the teaching program at my previous university was accepting my application. However, they were delaying me by a year, and I would have an additional 12 months in which to fill. I was 22 and nothing pulling me back to England, so I decided to extend my visa and continue working in the USA for 18 months.

One weekend, I was arranging an education program for a group of Girl Scouts, and it happened. She walked into the room. My new boss, her blond hair thrown up ponytail and wearing a blue hoodie, came to introduce herself. Fast-forward 12 months, and she was my fiancé and we were preparing a wedding before my visa ran out. I assure you, love was the main motivator – the green card was a distant second .

Let’s talk about money for a minute. I love spending it. I loathe saving it. I was one of those kids who made a list of things he wanted to buy with his allowance for the next year. I loved finding things I wanted to buy and planning how I was going to use them.

Saving money seemed silly – why not enjoy it instead of watching it sit in an account? One of things I did save for was traveling when I was 18. I traveled the East Coast of the USA for three weeks when I graduated high school, and I dropped a couple of grand to do that. But I’ve been known to do some stupid things with money.

Here’s a short list:

  • Buying a car (yes, a car!) on a credit card so my girlfriend (now wife) wouldn’t have to drive to pick me up to go on dates. It was beater though so didn’t cost over $1,500.
  • I lived at home throughout college, yet I took out some loans. I didn’t need them, but I spent the loans shopping and traveling. Dumb idea.
  • When the video store I worked at when I was 18 closed down, I purchased multiple VHS tapes from them. Even though I had a DVD player at home. And the tapes had been watched 1,000’s of times.

Back to the story.

One month before our wedding, my parents came over from England on vacation and I went with them to Arizona. We laid out by the pool and I started reading one of the books I had randomly picked up at the airport (another impulse purchase!). Well, the laugh was on me. I had picked up Dave Ramsey’s “The Total Money Makeover”.

In this book, he lays out the simple way to get you in a good place with money and how to look at it differently. I rushed home from vacation and told Sarah (my fiancé) about this book and approach, and received a nod back. She obviously knew all of this stuff and the relieved look on her face meant that she knew I wouldn’t be blowing money in our marriage.

Fast-forward six months.

We were enjoying our honeymoon period and I accepted my first office job. When non-Americans get married, they have to apply for a work permit before being able to work in a “real” job. I was getting a stipend of a couple hundreds dollars a week teaching outdoor education due to my visa, but now got a job earning over $30,000. That rocked my world. The job didn’t. Having a psychology degree, I thought HR consulting would be a natural world that I would fit into – wrong!

After two months, I was bored with the work. The personal finance bug had bitten me, so I was looking for more ways to learn. One night, I came across an online Certified Financial Planner program and convinced Sarah that I should study this. As it was online, I studied some at night, along with Sarah who was doing her Master’s degree.

During down times at work (of which there were a LOT of), I took another class. I started to look for jobs helping people with their finances and stumbled across the FPA and NAPFA. There were some firms hiring in my local area so I decided to interview. Then I got fired. Apparently, studying for another qualification at work takes away your attention from your current job – who knew!?!

Looking for a New Job

So without a job and a handful of interviews at these companies, I could focus 100% on my job search. I had an interview at New York Life Insurance, and decided to mention Dave Ramsey and how I didn’t believe in whole life insurance. Surprisingly, I didn’t get that job! I interviewed with a smaller fee only firm that was in need of a paraplanner to support their current advisors. I went into the interview telling them I was already studying the CFP materials and I would do anything they asked.

After a month of waiting and hassling this company, I got the call I had been waiting for. Kind of. They wanted to hire me, but wanted me to come in as a “Junior Paraplanner”. I accepted. I later found out, that Junior Paraplanner is fancy wording for a receptionist . But I wasn’t complaining – I was in the industry I wanted to be in and it was up to me to prove that I could do the job.

Asking for More

The first few months were fun – greeting clients, learning how a smaller office worked (I went from an office of 150 to 6 people), and doing some basic data entry. Then their main paraplanner quit. Step in Dave. I made it very apparent that I wanted her complete workload as well as my current duties. I was halfway through my studies, I knew the basics of planning and I had been studying how the company put together their plans. I went from making coffee to being a paraplanner on 50 clients.

Working on different client situations was fascinating. Not only did I get an inside view of someone’s life, I got to see their habits in spending, saving and giving. Many of the big spenders I worked on weren’t the most generous givers, and vice versa. But the coolest thing was knowing that all of these clients were paying for our advice on their finances. Over the next three years, I worked on clients in various stages of life and learned different planning approaches and rules from the planners that worked there.

Building My Professional Network

I also got involved with FPA’s NexGen program, a peer group of planners across the country who are under age 36. It was through that program that my ideas got challenged, how I found out about new approaches to planning, and what the future might look like for planners. That led to me setting up my own networking group, NAPFA Genesis, for fee only advisors under the age off 33.

After a company buy-out, I became aware that my career goals were not aligned with the company’s goals and I wanted to move my career along a lot faster than they wanted to. I then began looking for another job.

This time there were not as many jobs to apply for, so I went on the offensive. I emailed every local fee only firm to introduce myself. I explained who I was and what experience I had, and would like to meet with their owner or lead planners. There was not much activity as a result of this, but a paraplanner at one company left a month after my email campaign. I subsequently interviewed at this company and joined them shortly afterwards.

This company, although still fee only, was a lot different than my last one. They were geared towards growth, had a planner who was leaving in the next decade and would need succession partners and they would help me market to prospective clients when that time came. They also worked with higher caliber clients, with about 50% of their client base being executives at a Fortune Global 10 company. The planning got more complicated, the amount of money being earned, saved and spent by these clients increased significantly, and client situations were still as varied as they were before.

While at this firm, I was given the freedom to decide whom I wanted to market too. After deciding to work with teachers (through a process of discovering who I knew, enjoyed planning for, wanted to build a career around), I then set up a marketing plan to reach these teachers.

But something was still missing.

Planning for executives was starting to get a bit empty. I didn’t know if the advice I was providing would make a difference in the lives of these clients. It would save them money, but when you are earning over 7-figures every year, money isn’t much of a concern anymore.

But the teachers I was working with really appreciated the advice I was providing. They didn’t have much financial knowledge, so educating these clients was pretty extensive, but the gratitude they expressed to helping them become more organized and financially-streamlined was well worth it.

Refocusing My Target Clients

While I worked with these teachers, I wrestled the dream of wanting to start my own firm. I had been researching different technology solutions throughout my career and realized that I would love to build my own firm using these. I was also becoming more known in the financial planning profession and had started writing a column for a prominent trade magazine. Using my writing income and some savings, I decided to launch my own firm.

It wasn’t an easy as just saying, “Yeah, I launched my own firm.” This took nine months of planning, both early mornings and late nights, while holding down a full-time job. I worked with technology vendors, marketing consultants, other solo advisors to get their opinion and some close friends to get their opinion on what I was thinking. I even took a week off of work to film a video training program for teachers wanting to do planning without speaking to a planner. If I had to do it all over again, I wouldn’t have changed anything. It was tough, but the reward was well worth it.

Take Every Experience and Build

So that’s where I am today. After six years of working for someone else, I now work for myself (and my clients). I run a niche practice called Finance for Teachers, and help teachers from around the country organize their financial lives and help them plan for the future. As well as running my own financial planning practice, I have multiple other income streams – something I would encourage every entrepreneur to do:

  • I still write my column, and now blog for this trade magazine.
  • I work for a consumer website 12 hours per week providing financial advice via a chat room.
  • I am launching a consulting firm (Fee Only Consulting) that builds customized career tracks for people looking to advance in their firms. (This is something I wish I had had during my six years).

For anyone looking to become an advisor, I would happy to answer any questions in the comments section below. Or if you’re savvy enough, you can find my email address on my company page .

photo credit: PeterJBellis via photopin cc

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Comments | 7 Responses

  1. kEN says

    Are you a CFP yet? If someone has a bachelor’s degree in a non-finance field, how can they get started on being a CFP? How much can a paraplanner expect to make a year?

    • says

      Ken,

      I am a CFP, just like Jeff. THere are a number of CFP classes online or at local college campuses that allow you to study without having a finance related degree. All they ask is that you have a bachelor’s degree.

      Paraplanning salaries will vary based on experience and knowledge. THe bottom end will be about $40,000, but can go as high as $65,000.

  2. says

    Dave, thank you for sharing your story. I’m also interested in possibly getting into personal finance sometime in the future. I was wondering if you would suggest that if you are currently working in a totally different career field (as I am) would you begin by getting some education around financial planning first? I have a friend who did a masters in finance but now can’t get a job that will get him his certifications to be a financial planner. I wouldn’t want to end up in that type of situation. What would you recommend as a good first step especially if you don’t want to sell life insurance? Is it inevitable that getting into financial planning will involve starting out selling life insurance?

    • says

      Jon,

      Great questions. Firstly, I would sign up to take the CFP classes. This was a big factor in how I got my first job with no experience. They saw I was a self-starter and that impressed them.

      If you don’t want to do the commission route, you don’t have to – however it will be harder to get a job. Take lots of local owners out for coffee, ask them what their advice would be and get on their radar. Maybe there will be an opportunity for you by doing this (my most recent mentee got a job offer doing this).

  3. says

    Do you find that as a financial planner (CFP) your occupation is focused more around selling financial products? I love helping people with financial advice and I think it would be a dream occupation for me, but the thought of selling mutual funds and insurance products is a bit of joy killer.

    Also, with great movement towards self-education and self-direct accounts, do you think professional planners becoming a bit of thing of the past?

    Or is being a fee-only consultant removes these concerns?

    • says

      I have never worked in an environment that has sold products – I’ve always been a Fee-Only advisor. I agree with you and selling products was off-putting to me, so I chose to start my career in the Fee-Only segment of the industry. However, I do have to “sell” my services which is a little bit different.

      The self-help world is interesting. There are a lot of resources and information available but I don’t think this means the end to the profession of an advisor. In the same light that I could put a whole work out and diet plan together, yet I don’t. If I wanted to I could, but I know that should I want to do it, I would hire people to put it together and hold me accountable. The same rings through true for financial professionals – we know the truth from the noise, help people understand what is right for their situation, and become their accountability partners.

      Thanks for your questions,
      Dave

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