Sharing Your Knowledge as a Financial Professional

[PsyopRanger]

I am wondering if anyone has taken up Financial Planning part time in Semi-ER?
Not on a commissioned basis but a fee-based and experienced based?
Honestly, who would you want financial advice from, someone who makes a living “selling” advice or someone who is FIRE and living on 4% who can show you how they did it?

 

[unclemick]

Hmmmm - won't be prudent - calling someone a knothead is not good sales technique - even fee based.

My sister hasn't listened in thirty years - lived a long/too long time in Vermont, votes Republican and thinks the Pats are a good football team.

At least my oldest Nephew read the Bogle book I gave him ten years ago, did TSP index. Still votes Republican, roots for the Pats, and golfs(I think it's mandatory for officers). 1 out 4.

Then again - this forum is free.

heh heh heh - toss in a few bucks for FireCalc - if the fee urge strikes.

 

[brewer12345]

I've thought about it. Assuming one is willing to do "work", there are two hurdles:

- You must have some sort of letters after your name to be competitive. This isn't insurmountable for most.
- You must find a way to deal with potential liability arising from this profession.

 

[Donzo]

I would think that you could deflect any liability with a release form for any clients to sign.
Advertising to draw clients could be a problem - thats why most advisers work for larger firms with alot of advertisement. Now it is normal for insurance agents to also be FA-kill 2 birds, one stone

 

[Rich_by_the_Bay]

I would think that you could deflect any liability with a release form for any clients to sign...

Don't think it's that simple. You still have exposure. All the disclaimers in the world won't protect you from one claim or another.

If being a financial consultant is anything like medicine, your best protection is good practice, following national guidelines if appropriate, don't piss people off, and have plenty of paid up liability insurance policy.

 

[grumpy]

I thought I wanted to do financial planning part time after retiring from my gov't financial manager job. I took coursework toward the CFP certification and got a part time job working in the office of a friend who was a financial planner. After 4 months it was clear to me that being a financial planner wasn't for me. I was constantly put off by his practice of putting clients into investments that were not the best low cost option (as I had always used for my own self-directed investing) but into ones where the financial planner could earn commissions. I did enjoy the analytical work. The planner wanted to have a product to offer clients looking for high dividend income. He asked me to put together a portfolio of 25 high dividend paying companies. I had to do all of the reseach (using some nice tools he had that were alot better than what I had available for my own personal research) and then justify each selection to him. The give and take with him on selections was very educational for me. By the time I decided to give up this work the high dividend product had attracted $.5M of investments from his clients.

I am happily fully retired. I use what I learned from that experience for managing my own portfolio but I have no desire to provide advice to others except here on this forum.

Grumpy

 

[brewer12345]

I would think that you could deflect any liability with a release form for any clients to sign.

Waaaahhahahahaha!  Pull the other one; its got bells on.

No effin' way.  You would want E&O insurance on top of any release, minimum.

 

[Martha]

I agree with Brewer on the E&O insurance.

 

[Nords]

I am wondering if anyone has taken up Financial Planning part time in Semi-ER? 

Try "Avilynn" over at M*'s "Investing DURING Retirement" board. He's a retired engineer (now in his 80s) who went through the CPA coursework, although I'm not sure whether he was able to meet the requirements for the CPA designation.

He's a colossal jerk. His CPA is mainly used to beat others over the head in their "financial ignorance".

I'm not looking for a job, but if I was going to work in retirement then I'd market myself as "part-time" or "selected clients only" or some other restrictive criteria. Any claims to be even semi-retired would probably be met with the classic query "If you're so good then why ain't you fully retired?"

 

[yakers]

There was a good discussion of this on the Morningstar Vanguard diehards board ( http://www.careerjournal.com/reports/financialadvisory/20060123-bennett.html)

Got this from posting #8 (http://socialize.morningstar.com/Ne...vSeqNumber=52179&mrr=1154179260&t1=1154362207)

I would like to do something like this but the closest I get is discussions with friends and the sharing of books (including Get A Life, YMOYL, our RE Bob's book, and others).

I do get to help manage my Mom's & MIL's $, so that is some practice.

The good FAs I know make only an OK living and then it is built up over time. Just seems like too much work and too much time to become a part time professional.

 

[Mwsinron]

I tried one time to share some insight with a relative. Cripes Ill never make that mistake again. This relative was so very positive that his big name company was doing the best for him and charge low low fee's. Finances are almost like politics one of those dicey family discussions.

 

[Scrooge]

I tried one time to share some insight with a relative. Cripes Ill never make that mistake again. This relative was so very positive that his big name company was doing the best for him and charge low low fee's. Finances are almost like politics one of those dicey family discussions.

Off the top of my head, I know two people who use financial advis*rs. I have talked to them about it and gently hinted that perhaps they were entrusting their money to people whose best interests were not necessarily the same as theirs.

One of them explained that she didn't really understand finances, but she had shopped around until she found one who could get her a consistent 8% return and that's all she wanted.

The other person's financial advis*r was a "friend of the family" and was "definitely an honest and hard working person who has handled our finances for years".

Oh well.

 

[rs0460a]

He's a colossal jerk.  His CPA is mainly used to beat others over the head in their "financial ignorance".

THANK GOODNESS (I thought I was the only one that felt that way about him  )...

 

[Nords]

THANK GOODNESS (I thought I was the only one that felt that way about him  )...

His name was the first added to my "Ignore" list.

***** was the second.

I don't go to M* anymore...

 

[kcowan]

...I do get to help manage my Mom's & MIL's $, so that is some practice.
...

It took 18 months to convince MIL to stop paying through the nose for her "managed portfolio". Her returns immediately jumped by $20,000/yr when I took over (before any better investments).

 

[heyyou]

Nord's description was right.

 

[rs0460a]

but she had shopped around until she found one who could get her a consistent 8% return and that's all she wanted.

Stupid question - did she get her wish   

 

[Scrooge]

Stupid question - did she get her wish   

Assuming I understand the question correctly, then yes, she says she did. But I wonder what will happen the first time she doesn't get her 8%.

 

[saluki9]

I'll try to shed some light on the original topic.

As some may know I work as a PM for an advisory firm in Chicago.

1. You MUST have liability insurance. It should at least cover the average size account you are working with. I'm a PM and not an asset gatherer, RM, or broker and my premium that the firm pays for me is $5,000 per year. This is not out of the ordinary

2. In may states if you hold yourself out to the public as a "financial Advisor" you must be registered as an investment advisor and submit to audits and reviews at any time. It is not unusual for the inspectors to barge right into your office unannouced and ask to see your books. records, and client files.

3. As you have probably noticed, most of the really successful brokers or planners aren't the most financially astute. This is because the things that make you a good investor ARE NOT the same skills that help you gather new clients. That's why I'm thankful that our firm is large enough to have a PM staff that does all of this work leaving the relationship work to the planners. You might be the smartest planner there is, but 9/10 of people will go with the guy who belongs to their country club (church, rotary, etc) because "He seems so trustworthy!"

It's a rough business, but I guess every business is.

 

[Gone4Good]

I've thought about it.  Assuming one is willing to do "work", there are two hurdles:

- You must have some sort of letters after your name to be competitive.  This isn't insurmountable for most.
- You must find a way to deal with potential liability arising from this profession.

I'd also add:
- You must be willing to spend a lot of time cold-calling and prospecting for clients.

I imagine that during the first 5+ years in business you will invest a lot of time and make very little $.

 

[unclemick]

I'll try to shed some light on the original topic.

As some may know I work as a PM for an advisory firm in Chicago.

Soooo? Whaddya buying now??

heh heh heh heh heh heh heh heh - is that the PM equivalent of the ER - whaddya do all day?? My sister has been asking on and off for thirty years - and has never listened/let alone acted.

 

[saluki9]

Soooo? Whaddya buying now??

heh heh heh heh heh heh heh heh - is that the PM equivalent of the ER - whaddya do all day?? My sister has been asking on and off for thirty years - and has never listened/let alone acted.

What do I do all day?

Let's see...... I

1. Open new accounts, create liquidity for distributions, write Investment policy statements, equitize cash for new accounts, answer LOTS of questions for clients, talk clients out of buying stupid things in their accounts, allocate block trades, update our treasury and muni ladders, update our asset allocation policies, report all our trades to the MSRB and the like, etc etc etc

and that's just before lunch

 

[PsyopRanger]

I'd also add:
- You must be willing to spend a lot of time cold-calling and prospecting for clients.

I imagine that during the first 5+ years in business you will invest a lot of time and make very little $.

I am not talking about full time, why not have a business card with a title of Certified Early Retiree, that is bound to ask questions eventually? I am talking about becoming a RIA, not selling anything. But teaching 4% withdrawl, Rational Portfolio, maybe setup a plan for a small fee for a side business with tax benefits? A Company car, business lunches, all the GAAP perks of being a 1099'er.

 

[Nords]

... a title of Certified Early Retiree...

Hot dog, let's get started on the certification requirements right now!

Just as soon as I'm done surfing.

 

[nfs]

I am not talking about full time, why not have a business card with a title of Certified Early Retiree, that is bound to ask questions eventually? But teaching 4% withdrawl, Rational Portfolio, maybe setup a plan for a small fee for a side business with tax benefits?

I still don't understand why you want to do this. It's work. Are you looking for work?

BTW, I do this now but I set my fee high enough that work doesn't exactly flood in. Also, I try very hard to point people to decent resources, whether that be books or articles or - horrors - intelligent discussion forums on the Web. I want people to know that they can DIY in all but the most unusual cases.