It’s time for another edition of Dollar and Cents. This is where I answer one of your questions.
Today’s question comes from Derek:
Hey Jeff, First thing I want to say great blog! I’m currently in the workforce and entertaining a new profession as a financial planner. I really enjoy keeping up with the markets and many of my friends and co-workers come to me for advice on their investments. I’ve been doing some research in getting in the business and it seems daunting as many of the big brokerage firms want you to work crazy hours the first couple of years. I’m not ready to give up my day job and was considering giving it a go part-time. What do you think about the likelihood of being a part-time a financial planner?
Derek is not the 1st person to ask me about becoming a part-time financial advisor. Many people that have a love for investing, numbers, and helping people have emailed asking me something similar.
To all of those that are interested in the financial planning profession on part-time basis, this video is for you. 😉
Making sure that I hadn’t missed anything regarding being a part-time financial advisor, I asked some of my colleagues to share their thoughts on the matter. Here’s some comments from a fellow financial advisor whether you can do it part-time:
Part-time Financial Planning
I think if a person wants to pursue a part-time or “on the side” financial planning business, they need to first decide how they want to do it. Let’s assume for a minute that it’s possible. Do they want to get into financial planning because they think it’s interesting? Because they want to help others? Because they have a personal interest in finances and investing? Or is it something else? None is better or worse than the other, but I think getting clear on this up front will help clarify the rest of the thought process. Also beyond an immediate friends & family circle, how will they market and attract clients?
- If they want to help others, they can outsource much of the financial planning and investment management (if any) work. In this scenario, they would be relationship managers first and foremost. And if they have capable planning resources that they’re partnering with, this helps address the potential concerns clients may have about working with a “part-time” planner
- If they want to write plans and get into the technical side of planning, this might work, but I’m skeptical. Outside of a full-time job, how will a person have time to find clients, do the actual planning work, service/keep clients and still have a personal life? I’m not saying it can’t be done, but I think it would be difficult assuming you can even find clients beyond immediate friends and family that would be willing to work with you if you’re doing this on the side. If you’re only spending 20% of your time doing planning work, are you going to only charge 20% of full-time planners’ fees?
- Also, just because someone has an interest in personal finances, it doesn’t mean they’ll be a good planner. See Michael Gerber’s E-Myth about potential issues when a “technician” that likes to do the work is trying to grow and run a business. It can be a challenge for those not going into it with both eyes wide open.
- Though not strictly “financial planning,” many professional third party asset management platforms offer a solicitor arrangement where you can setup and manage client portfolios by contract on a per-client basis. This might be another variation on outsourcing some or all of the work I mentioned above
I know I’ve raised more questions that I’ve answered. I’m frankly not sure if it can be done, but rather than assume that it can’t, I think anyone interested needs a thorough understanding of what role they want to play in the financial advice/planning industry before moving ahead.
With each Dollars and Cents video we want to provide some follow up links where you can get some additional information on the topic. If you are interested in learning more on becoming a financial planner here are some great reads:
- How to Become a Certified Financial Planner – The CFP designation is one of the hardest but most respected marks of the financial planning industry. Here is how to become one.
- How to Become a Successful Financial Advisor – Just getting the CFP won’t make you an overnight success. Some great tips on how to build up your book of business.
- Want to Land Your Dream Job? How to Get Started as a Financial Advisor/Planner – More tips on how to actually get started on the path to building a financial advisor and financial planner.