Being a Financial Advisor - The Good, The Bad, and The Ugly - The Belle Curve (2024)

Posted by blair

I’ve written a lot about how being a financial advisor is the best career in the world. And it is, for me. Lately, I’ve come to realize that it takes a certain temperament and skill set to enjoy the work. This is not a job you can leave at the office at night or on weekends. It sticks with you always, in your brain, even in your dreams. The stakes are too high. Advisors are responsible for the financial stability, goals, hopes, and dreams of their clients. Or at the very least, advisors are responsible for providing peace of mind that a client’s plan will work despite inevitable market downturns and crises du jour. The weight of that responsibility is heavier during bear markets. These are the times that advisors earn their stripes.

For anyone curious about a career as an advisor, here are my thoughts on the good, the bad, and the ugly aspects of the job. I’ll start with the negative stuff and work down to the positives. Because despite what I am about to share, I know this is the best job in the world for me. I have to pinch myself sometimes. I get to wake up every morning and do what I was born to do and what brings me immense satisfaction even on the hardest days. So here we go ….

The Ugly

I knew a broker in my early years who was afraid to leave his desk to use the bathroom. His largest, and most demanding client, might call to execute a trade. If he missed that call, the client would be angry and could accuse him of missing the right price on the trade. He was miserable, but he depended on that client’s sales commission revenue to pay the bills. I’ll never forget the day this broker decided to part ways with that client. He took a leap of faith, that he would be able to find enough new clients to fill the gap in his income. It was like an enormous weight was lifted from his shoulders. Not only could he use the bathroom without inducing a panic attack, but he could also go out for lunch meetings with other clients and colleagues. He’s still in the business, so I can only assume he had no problem making up for the lost revenue. His health, both mental and physical, was improved by his decision.

In my first job, I was a sales assistant on a large team at a brokerage firm. The team had several clients who would yell and scream at me on the phone while I fumbled through client service requests. On my very first day, I was asked to send a $4M wire out for a client who was leaving for another advisor. I had no idea how to enter a Fed Fund wire into the system and very little support in my office to teach me. The client had already made the decision to fire my team, so let’s just say there was no reason to filter his frustration with the new girl transferring his millions. I’m pretty sure I drowned my tears in a bottle of wine that evening. There were times in those early days when I felt like an incompetent service person answering a 1-800 number in a call center. It toughened me up but also frayed my nerves.

When I left the brokerage world after the Great Financial Crisis, I learned that there was a different way to be a financial advisor. On the advice side of the business, my mentors chose not to do business with clients who were mean-spirited or treated them with disrespect. Life is too short to work with people who cannot be satisfied. There’s an advisor out there for everyone, and it’s OK that I am not a good fit for every client.

The Bad

Even when working with amazing clients who all appreciate the work I do, there are still bad days. Beyond the obvious difficulty of keeping clients calm during bear markets, clients will inevitably run into difficult challenges that require my help. Illness, divorce, providing care for sick family members, layoffs, failed business deals, and even death occur with regularity. As an advisor, I experience tough times alongside my clients. Sometimes I am able to assist with financial planning, insurance, and advice. Other times, I can only offer an open ear and a shoulder to cry on.

I’ll never forget a client at the brokerage firm who called to ask questions about her IRA account. She wanted to know if she was eligible to make a contribution that year. I explained that since she was retired, with no earned income, and over the RMD age limit, she was not eligible to make a contribution. She asked several follow-up questions, and we ended the call. Less than a minute later, she called back and proceeded to ask me the same exact question. We had the same conversation as if the first conversation never happened. That was the first time I witnessed the cognitive decline of a client. It was frightening. We didn’t know her family members and had no way to assist her in setting up Powers of Attorney to protect her from making a major financial mistake.

In my very first internship at a local Smith Barney branch in Athens, GA, I worked for course credit and assisted the brokers with various tasks. I will spare you the story of the broker who had me rewrite (in ink) his entire Rolodex! Another broker brought me a stack of annuity forms and asked me to contact each company to file a death claim. One of his clients had died, and he was assisting their beneficiaries with the annuity withdrawal process. As I faxed copies of her death certificate (my first time seeing one) to the annuity companies, I realized that death is a regular part of a career in wealth management.

Advising clients through the most challenging times of life isn’t always a walk in the park. Their grief, anxiety, and fear live in my head and my heart. It is a constant reminder to live my own life to the fullest and never to take today for granted.

The Good

I saved the best for last. The good parts of being a financial advisor massively outweigh the downsides. At its core, my job is to help people accomplish their hopes and dreams. I am able to provide peace of mind that the nest egg they’ve accumulated will be enough to last through retirement. I celebrate their achievements; marriages, births, graduations, retirements, family vacations, second home purchases, career changes, and charitable endeavors.

On multiple occasions, clients have shared their pregnancy news with me before the grandparents or any of their friends. After all, it’s important to get a jump on college savings and life insurance. I get to celebrate with clients who tell me that yet another grandchild is on the way. I’ve witnessed clients buy their dream home, certain they can afford it based on the plan we created. I get text messages and emails with photos from their travel around the world. When my children were born, many sent me small gifts or handwritten cards.

My absolute favorite call is the one from a client who is ready to make a major life change. They want to retire earlier than planned, buy a second house overseas, start a new business, or move to a low-tax state with better weather. I love when plans change, and I can show them the financial path to make that change. These are the real-life decisions that help clients build a better life and find more happiness. And while I am only one small part of that process, I never take it for granted.

A career as an advisor may not be for everyone. You have to be comfortable forming deep relationships with the people you serve. It requires giving a lot of your headspace to those clients. It requires the willingness to have difficult and uncomfortable conversations. But the joy is in the struggle. Seeing the results of your work have the power to change lives for the better is an incredible reward.

Nothing in the world is worth having or worth doing unless it means effort, pain, difficulty… I have never in my life envied a human being who led an easy life. – Theodore Roosevelt

Now go talk about it.

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Being a Financial Advisor - The Good, The Bad, and The Ugly - The Belle Curve (2024)

FAQs

How to answer why you want to be a financial advisor? ›

"The main reason why I want to be a financial advisor is my passion for helping people and interacting with them. A person's financial decisions are very likely to influence their entire future, and I'd like to take the responsibility of helping them.

What is the hardest part of being a financial advisor? ›

What is the hardest part about being a financial advisor? The hardest part about being a financial advisor is often the constant need for client prospecting and business development, especially in the early stages of one's career.

Is it worth it to be a financial advisor? ›

Successful financial advisors offer valuable advice to their clients. In return, they get virtually unlimited earning potential, a flexible work schedule, and their choice of professional specializations.

What are the cons of being a financial advisor? ›

Cons of Being a Financial Advisor
  • Building an advisor practice and growing a client base may be challenging.
  • Completing the necessary requirements to get certified and licensed can be time-consuming and costly.
  • Working hours are often long, particularly in the early stages of growing an advisor business.
Mar 23, 2023

What is the most important thing for a financial advisor? ›

They have a passion for the subject and are curious about their clients and the changes in the industry.
  1. Passion for Financial Planning and Wealth Management. ...
  2. Deep Analytical Ability. ...
  3. Ability To Market Yourself. ...
  4. Putting a Client's Interests First. ...
  5. Curiosity.

Why being a financial advisor is great? ›

Being a financial advisor is a rewarding profession. Aside from enjoying a flexible work schedule and infinite income potential, you can also help families improve their financial situation and secure their future through expert advice on money matters.

Why do financial advisors quit? ›

Lack Of Fulfillment

They are required to spend their days selling products and services they don't believe in. Far too many advisors find themselves working 9-5 (or worse) at a job that doesn't fulfill them or make them happy.

How many people fail at being a financial advisor? ›

What Percentage of Financial Advisors are Successful? 80-90% of financial advisors fail and close their firm within the first three years of business. This means only 10-20% of financial advisors are ultimately successful.

What type of personality does a financial advisor have? ›

Financial advisors score highly on extraversion, meaning that they rely on external stimuli to be happy, such as people or exciting surroundings. They also tend to be high on the measure of openness, which means they are usually curious, imaginative, and value variety.

Why do financial advisors make so much money? ›

Commissions. In this type of fee arrangement, a financial advisor makes their money from commissions. Advisors earn these fees when they recommend and sell specific financial products, such as mutual funds or annuities, to a client. These are often payable in addition to the above client fees.

How many hours a week do financial advisors work? ›

Work Environment

Most personal financial advisors work in the finance and insurance industry or are self-employed. They typically work full time, and some work more than 40 hours per week. They also may meet with clients in the evenings or on weekends.

What is an appropriate fee for a financial advisor? ›

Financial advisor fees
Fee typeTypical cost
Assets under management (AUM)0.25% to 0.50% annually for a robo-advisor; 1% for a traditional in-person financial advisor.
Flat annual fee (retainer)$2,000 to $7,500.
Hourly fee$200 to $400.
Per-plan fee$1,000 to $3,000.
Apr 26, 2024

Do financial advisors have a bad reputation? ›

Financial advisors and insurance agents may have a certain reputation in many circles. While I believe the majority are honest, some advisors may give the rest a bad name by focusing on the commission instead of the client. And, even if you meet an honest advisor, how can you know they will do the job suited for you?

What to avoid in a financial advisor? ›

Here are seven mistakes to avoid when hiring a financial advisor.
  • Consulting with a “captive” advisor instead of an independent advisor. ...
  • Hiring an individual instead of a team. ...
  • Choosing an advisor who focuses on just one area of planning. ...
  • Not understanding how an advisor is paid. ...
  • Failing to get referrals.

What is the biggest challenges for financial advisors? ›

Financial advisors face challenges such as market volatility, regulatory changes, client expectations, and technological advancements.

Why do I want to be an advisor? ›

A helping profession

As advisors know so well, providing information and guidance about matters related to investments and finances involves much more than money and numbers. The real job of an advisor is to understand a client's dreams, hopes and goals for the future, and then develop a plan that gets them there.

Why do you want to work in financial services? ›

It offers a fast-paced, continuously challenging career

The adrenalin of deals (whether you're the client or broker) and the buzz of the trading floor and the pace of change - for the better or worse - means it can provide a highly stimulating career.

What is your goal as a financial advisor? ›

Having clear goals to work toward can give you the motivation you need to scale while helping you to develop a focused plan for doing so. Some of the most common financial advisor goals include growing your client base and increasing revenues.

Why would you hire a financial advisor? ›

A financial advisor can help you hone in on your goals and map out a way to achieve them. This can be anything from starting to invest, buying real estate, saving for an emergency or retirement, or something else.

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