Over-Aged Financial Planners?

[ScottFromUtah]

I have two close friends who are financial planners. Both are well past normal retirement age but can't afford to stop working. Hmmmm.

Scott
FIREd 7/1/2008

 

[MasterBlaster]

Change the name "Finacial Planner" to salesman or stock broker or insurance agent.

Then it will all make more sense to you.

 

[FinanceDude]

Change the name "Finacial Planner" to salesman or stock broker or insurance agent.

Then it will all make more sense to you.

Hmm.....there are NO retired salesmen, stock brokers or insurance agents in America? Can I see some statistics on that?

 

[MasterBlaster]

FD:

I had interpreted the original post to wonder and to point out the irony as to why a "Financial planner" was still working. If they were good at financial planning then they would have retired at 50 to the links and the good life.

But if they are just another sales guy with the ubiquitous financial planner shingle mounted on their doorway then we get what was posted.

One has to wonder how much expertise they have if they are still working. One also has to wonder what kind of job they will do for [-]on[/-] you.

 

[ls99]

Here we go. Need a poll on how many would trust the advice of a financial planner who can't afford to retire, say by 55 or 60?

 

[Gone4Good]

Hmm.....there are NO retired salesmen, stock brokers or insurance agents in America? Can I see some statistics on that?

Of course they are out there. It's their clients who aren't retired.

 

[JustCurious]

I have two close friends who are financial planners. Both are well past normal retirement age but can't afford to stop working. Hmmmm.

What is "normal retirement age?" How do you know they can't afford to stop working? Some people can afford to stop working, but continue to do so for reasons other than the need to pay bills.

I know it is heresy to say so on this board, but some people actually like what they do!

 

[Onward]

I have two close friends who are financial planners. Both are well past normal retirement age but can't afford to stop working.

Where are all the stock-brokers' yachts?

 

[Gone4Good]

This thread got me thinking about all the people who make insane amounts of money before the FA client gets a dime. Here's a partial list for a new stock offering . . .

1) 7 figure investment banker and a host of 6 figure underlings get their share of "advisory fees" on a new issue
2) 7 figure capital markets bankers and a host of 6 figure underlings get fees for specific advice related to market timing, structure, and the like
3) 7 figure syndicate bankers and a host of 6 figure underlings get fees to execute the IPO
4) 6 and 7 figure institutional salesmen get commissions to sell the new issue to mutual funds, insurance companies, etc.
5) 6 and 7 figure traders take bid-offer spreads on the new issue to "stabilize" the market of the new issue
6) 6 and 7 figure portfolio managers at mutual funds look at recommendations from 6 figure stock analysts as to whether to buy the IPO
7) 6 and 7 figure financial advisers sell 5 figure J.Q. Public on the financial products that keep the whole thing afloat.

Nice.

Which raises a question I've never been able to answer: Why are their so many millionaires between an institution that wants to sell a product (stock, bond, etc) and the person who wants to buy it?

 

[FinanceDude]

FD:

I had interpreted the original post to wonder and to point out the irony as to why a "Financial planner" was still working. If they were good at financial planning then they would have retired at 50 to the links and the good life.

Most financial planners that have done it for awhile are FI, but prefer to work. If they have built up a book of business and haven't found someone they trust or a family member to take over their book they don't just want to abandon their book and leave.........

One has to wonder how much expertise they have if they are still working. One also has to wonder what kind of job they will do for [-]on[/-] you.

I would not assume everyone wants to "get their work life" over as fast as possible.... Based on the many posts I have read on here, a lot of retired folks on here had crappy jobs and wanted out years before they were able to, but put the hammer down and made it to FIRE. Maybe some of us like our jobs?

I have no attentions of quitting when I turn 50, I have control of my hours and my life and my business, so why should I, when I enjoy what I am doing?

 

[youbet]

Which raises a question I've never been able to answer: Why are [-]their[/-] there so many millionaires between an institution that wants to sell a product (stock, bond, etc) and the person who wants to buy it?

Uhhhh..... Because they were smart enough to get themselves into that position?

Because they built a toll road and assigned themselves as owners of toll booths along the way?

Oh crap, I don't know...... Why?

 

[youbet]

Change the name "Finacial Planner" to salesman or stock broker or insurance agent.

Then it will all make more sense to you.

+1

Yeah, really. You could just as easily wonder why someone in any field is still working past 66 yo. Gosh, if this 70 yo symphony orchestra leader was any good, why isn't he retired by now?

If I was going to use an FA, and I never have, I'd probably be more concerned if I walked in the office and a 23 yo fresh-out was sitting behind the desk....... Depending on my assignment for him/her, of course.

 

[bssc]

Where are all the stock-brokers' yachts?

North Cove Marina, Battery Park.

 

[meierlde]

Where are all the stock-brokers' yachts?

Or perhaps where are all the financial advisors yachts?

 

[FinanceDude]

Or perhaps where are all the financial advisors yachts?

In the repo yard.........

 

[Sarah in SC]

I'll answer. The guy who started our firm never developed any life outside work. He has all the money in the world to retire, but nothing to do. Clients are his only friends, office is his only outlet and source of happiness.

Same as any other profession where they don't have anything to retire "to" so they stay around the office for all of eternity. He's done extremely well with his own and clients investments, but while he's glad to encourage THEM to retire, he can't take his own advice, though we would dearly love for him to do so.

Same with some of the old geezers in money management firms--there are a handful I know who are in their 80s and just can't let go of the firms they started, even though they don't make investment decisions day-to-day anymore, they won't go home.

Not a problem this financial planner will have, I assure you.

 

[73ss454]

Hmm.....there are NO retired salesmen, stock brokers or insurance agents in America? Can I see some statistics on that?

I know of at least one retired salesman!

 

[HawkeyeNFO]

Friend of the family is an FA, and one day I get a call from my parents telling me that he has Alzheimer's. They instruct me to get any money invested with him out, as he was slowly becoming erratic and unpredictable. Luckily for me I had moved my money from him a long time ago. But then my parents tell me that they are concerned for him and his wife, as they didn't think he and his wife had much money to live off in retirement. He was about 60 or so, and had been an FA for as long as I could remember.

 

[kumquat]

Most financial planners that have done it for awhile are FI, but prefer to work. If they have built up a book of business and haven't found someone they trust or a family member to take over their book they don't just want to abandon their book and leave.........

Wouldn't someone buy the book?

Or are they just so philanthropic that they can't abandon their clients?

 

[Sarah in SC]

kumquat, my older boss was like that. He sold the business 6 years ago and stayed on, both to keep in touch with the clients but also, based on simple reality, that if he had some sudden illness, he wouldn't be able to help them. Philanthropy, probably not, but the same kind of succession planning as ANY business would do.

I don't say it too much, but you folks sure have a broad ass paint brush for a profession that one of your hard-working moderators spends all damn day doing. I'm just saying...

 

[harley]

We were talking about over aged financial planners, not under aged ones.

 

[Independent]

This thread got me thinking about all the people who make insane amounts of money before the FA client gets a dime. Here's a partial list for a new stock offering . . .

1) 7 figure investment banker and a host of 6 figure underlings get their share of "advisory fees" on a new issue
2) 7 figure capital markets bankers and a host of 6 figure underlings get fees for specific advice related to market timing, structure, and the like
3) 7 figure syndicate bankers and a host of 6 figure underlings get fees to execute the IPO
4) 6 and 7 figure institutional salesmen get commissions to sell the new issue to mutual funds, insurance companies, etc.
5) 6 and 7 figure traders take bid-offer spreads on the new issue to "stabilize" the market of the new issue
6) 6 and 7 figure portfolio managers at mutual funds look at recommendations from 6 figure stock analysts as to whether to buy the IPO
7) 6 and 7 figure financial advisers sell 5 figure J.Q. Public on the financial products that keep the whole thing afloat.

Nice.

Which raises a question I've never been able to answer: Why are their so many millionaires between an institution that wants to sell a product (stock, bond, etc) and the person who wants to buy it?

Thanks, I've wondered the same thing. I'll show my ignorance by saying I'm not sure what some of these people do. Numbers 4, 6, and 7 make sense to me, I think I've even bumped into all of them. Your explanation of 2 gives me some idea. But I don't understand what 1 and 3 do. I think I always lumped 1, 2, and 3 together and called it "investment banking".

Then, I've never understood exactly how money is made in 5. Okay, I understand bid vs. offer from a buyer's perspective, I don't know the economics (including risks) on the trader's side.

Can you help me out?

(Warning, the next question will probably be "Why doesn't a competitive market squeeze these incomes down?")

 

[Gumby]

I don't suppose FA's are any different than any other profession. If you went to any big NYC law firm, you would find a number of partners/of counsel in their late 60's and 70's who come to the office everyday, and its usually not because they need the money. Generally, it's because they spent all their life's energy in the practice and have nothing else to do.

 

[kumquat]

kumquat, my older boss was like that. He sold the business 6 years ago and stayed on, both to keep in touch with the clients but also, based on simple reality, that if he had some sudden illness, he wouldn't be able to help them. Philanthropy, probably not, but the same kind of succession planning as ANY business would do.

I don't say it too much, but you folks sure have a broad ass paint brush for a profession that one of your hard-working moderators spends all damn day doing. I'm just saying...

Well Sarah,
You may be right as far as the general population of the world goes. I doubt that the average member of this forum agrees

 

[Gone4Good]

(Warning, the next question will probably be "Why doesn't a competitive market squeeze these incomes down?")

You've identified the heart of my question, and the reason for the post. Why doesn't a competitive market supply enough labor and competitors to bring salaries and fees in financial services down to a level consistent with other services in the economy?