Why I’m Not A Part-Time Financial Advisor (Yet)

Why I’m Not A Part-Time Financial Advisor (Yet)

My every morning (not)

My every morning (not)

A few people might know this about me, but most don’t. I’ve been trying to break into the finance industry for a few years now to no avail. Well, sort of. I am now a professional tax accountant, with and Enrolled Agent license (you can read all about enrolled agents here). But I didn’t originally start out to become a tax professional. I wanted to help people with money professionally.

To be clear, I LOVE my day job, and have no plans of moving on, because it’s a great gig, a good team, and I don’t feel the desire to go anywhere. But I’ve always wanted to help people with money on the side, and it would be awesome if I could turn it into a sweet side-hustle. So I started inquiring around about the options I had, and ended up connecting with my for church small group lead, who owns the CPA firm that I currently work for.

Advice From A CFP

I was put in touch with a CFP (Certified Financial Planner), and he was kind enough to chat with me on the phone for a little while about how to get into financial planning. I told him that I wanted to help people with money, which led him to advise that if I did end up managing people’s money, that I should become a fee-only advisor, which would enable me to have a clear conscience about which fund I picked for my clients to invest in.

I thought that was the best route, as I could not fathom the idea of collection commissions by investing other people’s money in loaded funds. My conviction was this: If I had put together a financial plan for someone, and was able to pick between two funds that both worked for the client’s goals, I wanted to be able to pick the absolute best fund for that client. But because I had to make a living on commissions, I would end up picking the worse fund which paid a bigger commission to feed my family. I could not make that decision in good conscience. So fee-only was my goal.

I asked how I should go about getting training and licensing to become a part-time financial advisor. He suggested I start by selling insurance to get familiar with the industry from a protection standpoint, and I could learn about securities and investing on the job. He gave me a contact to reach out to start the process, but with one warning: “Keep your goal to get out of insurance and into financial planning. Pursue your securities licenses ASAP, and don’t get stuck.” Good advice, considering what happened next.

The Life Insurance Debacle

I reached out to the contact provided, and setup an initial meeting with the rep at [Company Name] Life Insurance. Now, this was a few years back, and I remember thinking how odd it was that they wanted to meet with me about potential employment, when I was just a newb with a budget who wanted to help people. I had no prior experience, no 4-year degree, and no accredited financial expertise. Oh well, I guess they knew that I was a BOSS, and wanted my awesomeness to rub off on their company.

Anyways, the first meeting was at his fancy pants office, with ridiculously expensive furnishings and a bunch of crystal trophy like things that people with lots of recognition collect. He was VERY good at his job, which I later found out was recruiting newb who had a decent sized network of personal contacts to sell insurance. He asked me all about my background, where I worked, where I went to school, etc. He asked about my money principals, and just coming off the Dave Ramsey high, I told him all about my sweet budget, how I hated debt and whole life insurance, and how I was going to pay off my mortgage by 40 (and I didn’t even have a mortgage at this point).

That’s when he shifted uncomfortably in his seat, gave me a peculiar look, and decided to educate me on the values of whole life insurance. He busted out his slick PowerPoint presentation and started to take me through “the complete investment portfolio” presentation. Most of it sounded pretty good, but he was very insistent on a whole life insurance policy as one of the foundational pieces. At this point, I hadn’t done a ton of reading on this type of insurance, except that it’s front loaded with massive fees, and is really expensive. I told him I wasn’t really interested in selling whole life, and he gently “corrected” me by saying that it was short-changing my clients by not having them use it for retirement purposes.

Now, without turning this into the “whole life vs term” debate, let’s just say I could tell from his office, his demeanor, his tone, and the whole atmosphere that he was more interested in collecting money from a whole life policy than helping clients build a solid portfolio. I told him I would think about it, but I started to get the feeling that this guy didn’t care about my budget, and that’s not cool. We had one more phone meeting, and he started to push more on getting me started, which included handing over a list of my contacts t get started.

So I did the smart thing and googled “[Company Name] Insurance Scam” and started to read TONS (hundreds) of horror from other unsuspecting newbs. They gave up their contact list, were pressured to sell insurance to their friends and family (therefore alienating them), and the company owned the list of contacts when they got fed up and left. The company would then cold call and high-pressure-sales pitch their friends and family. NOT COOL. Suffice to say, I told them I was not interested, and the rep. dropped his friendly tone and told me he was VERY disappointed in my decision. After I hung up, I was pretty bummed…..mostly that he didn’t want to talk about my budget….he just wanted me for my millions of friends. Oh well, lesson learned.

So I Became A Tax Guy

So, I realized I couldn’t get right into the industry right away unless I wanted to sell my soul. I didn’t want to rip people off, and I didn’t want to give them bad investment choices. So the only thing left was to help people with their income taxes. I asked my small group lead about it, and he said “sure, just go get your E.A. license and get back to me.” GREAT! No big deal. Just need to pass 3 IRS sanctioned tests that are RIDICULOUSLY HARD, apply for the license, and I’m in!

In reality, they were VERY hard tests, and it took me one year straight of studying on nights and weekends to pass the exams. Once I got my license, I started working for my boss (CPA firm owner) to prepare tax returns during tax season. I started season and prepared only 12 returns, but I put in a TON of hours riding along with the other accountants, learning the tricks of the trade, figuring out all the grey areas (there are millions of them), and most of all, saving people tons of money. Now, I’ve gone through 3 tax seasons and feel very comfortable helping individuals and small businesses keep all the money they deserve.

I Haven’t Given Up

Taxes are awesome, but I still don’t feel like I am helping people on the level that I could. I can help them make smart tax moves during the year, but I have not been able to strike up a good budgeting conversation yet. The closest I’ve gotten is suggesting investing in an IRA to lower their tax bill, but that’s about it. I still want to become a part-time financial advisor, whether people think I can or not. And though I’ve talked to a handful of people who say it’s probably not the best idea, I feel that I can provide a real service to those who maybe just need some direction. I can help them with their budget to free up the cash that they can then invest, and then be full service and help them put that money in a place that helps them reach their goals, and then some.

I’ve got some ideas in the works, but they are far to infant to reveal here just yet. We’ll see how it goes. Until then, I’ll just be over here in my corner of the internet, waving my big BUDGETING flag and trying to help open people’s eyes to the realities of handling money. Hope you stick around 🙂

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Comments

  1. Good luck in achieving your dreams.
    Money Beagle recently posted..Shipping With StyleMy Profile

  2. It is sounds like you are treading the waters carefully which is fine and one day you will realize your dream. Never give up on what you want in life.Challenges will come but keep pushing.
    Demaish recently posted..It’s Friday! My low low day and other updatesMy Profile

    • Thanks Demaish. I don’t mind taking my time with something if I truly want to do it right. This is DEFINITELY something I want to do the right way.

  3. It pays to be tenacious. I love reworking my budget, but sometimes it just doesn’t line up with my spending. Maybe I’ll have you help me someday soon. I first have to get caught up on a couple of things. Keep waving that flag!
    Little House recently posted..Bad Math Skills Lead to Bad Finance SkillsMy Profile

    • I’d love to put together a budget for you. Just let me know 🙂 And I would say DON’T WAIT, there’s no time like NOW for getting a hold of your finances 🙂

  4. I know this is a totally different route but have you thought about being a money coach (like a life coach but with a specific niche)?
    Budget and the Beach recently posted..No Self-Control?/Link LoveMy Profile

  5. Good for you for not going with the scummy insurance guy even if it was a recommended step in the direction you wanted to go. At least you are happy in your current position and you’re still working toward your goal – progress is good! I’m sure you’ll fulfill that dream of being a financial advisor soon!
    E.M. recently posted..What’s Your View On Overtime?My Profile

  6. Helping people with their own finances is great and something I’m seriously considering later in life. When I was out of work I ran into some guy at the gym with at possibly the same company you chatted with. It sounded okay, but being pressured to give up names of people and selling to my friends and family just didn’t seem right. Eventually we parted ways because I couldn’t do that in good conscience.

    It’s still something I’m considering though for the future.

    Keep up the hard work! I hadn’t really thought about doing taxes. Not only can you help other get all the money back they legally can but the side effect of getting as much back as you can is great too.
    JC @ Passive-Income-Pursuit recently posted..Phillip Morris (PM) Dividend Stock AnalysisMy Profile

    • Yea, hard sales doesn’t work on me, I’m too much of a skeptic. I want to make sure not to be THAT GUY if I get into financial planning as well.

  7. “Taxes are awesome” – whoa, blasphemy!

    Good luck, my friend – be sure to keep your internet family posted.
    PK recently posted..How to Beat Investing or GamblingMy Profile

  8. I think you can get there. As you continue to help people with taxes, they will inevitably seek you out for other financial advice, and then you can tack that on as a service later.
    The College Investor recently posted..Why Portfolio Diversification Isn’t DeadMy Profile

    • I’m looking down that path for sure. I know the CPA I work for used to do that to some degree, so I’m going to be interviewing him about that here soon.

  9. I’m actually in a very similar situation to you. I passed the CFP exam back in November 2011 and lately I’ve been thinking more and more about starting up a part-time practice. There are a decent number of obstacles, mostly compliance related, but I think it’s possible. Anyways, I’d love to talk to you about this in more detail, as we might be able to help each other. Reach out to me if you’re interested.
    Matt Becker recently posted..More Proof That Insurance and Investing Don’t Play Well TogetherMy Profile

  10. Through this blog and your tax job you probably are helping lots of people with their finances. If you want to be a CFP I’m sure you will eventually do that.
    Andy Hough recently posted..Tips for Getting the Most Out of Cash Back Shopping SitesMy Profile

  11. MomofTwoPreciousGirls says:

    I been in the field for 17 yrs(licenses and all) I actually work as assistant to some fa’s but also have my principal licenses and have worked in that type of role. It is wonderful, however, I had trouble when I tried to move into being an fa, I stressed over taking people’s money and being responsible for someone’s life savings! As an assistant with so many years I get to enjoy building the relationships and helping without that stress!
    With a CFP you could go strictly into being a planner. Not necessarily working directly with the clients, but behind the scenes. The financial advisor gathers all their clients’s information, goals and assets and hands it over to the planner to build comprehensive plan to meet all the goals. Not just the financial, but estate planning, wealth transfer etc. Might be a way to do what you want.
    It is very difficult to be an fa part time. Mostly because when a client needs you, they need you. Consider the volatility that has been going on the last couple of weeks…when a client is panicking about their life savings they need you to be available to assure them. Also, if you work for a firm, you typically need their permission to do any other work! And they don’t allow you to do anything that competes with their business…so part time may be a toughie.

    • I’ve heard this before, and was originally why I stopped pursuing. But I have some things in the works that should be able to take care of most of the obstacles you listed here 🙂 Thanks for the insight from an industry pro!

  12. Sounds like a right dodgy bunch of people they were. It was a good thing you didn’t end up with them. I often say everything happens for a reason and believe it. Believe in yourself and you will achieve your goals.
    Canadian Budget Binder recently posted..Spending less: Kids’ birthday parties on a budgetMy Profile

  13. Since you are already working for a CPA firm, have you thought of becoming a CPA? The firm will help you fulfill the requirements and you just need to pass the test. Many CPAs do financial planning and you can still do tax planning and returns. The CPA license in some ways makes you more creditable than just a planner.
    krantcents recently posted..Google Reader Will Be Gone in Less than 48 HoursMy Profile

  14. Hey, Jacob! First, and I think most important, I love what you stand for. Your ethics and your intent are pure. I agree with Andy’s comment…you are already helping others through your blog and current work.

    Just relaying your story about the experience interviewing for the insurance sales position was gold. Two nuggets there: Beware of insurance sales people/products AND do your due diligence before joining any company.

    While the internet is full of grumpy people and you can’t believe everything you read, an abundance of bad press should be a red flag!

    Keep on doing what you’re doing!
    Ree Klein recently posted..References Available Upon Request…Really?My Profile

    • Thanks Ree! I can’t compromise on my standards, I would hate myself for ripping people off. Just don’t have it in me (and that’s a GOOD thing!)

  15. I like that you stuck with doing what you felt is right. It sucks but thats the insurance game and a lot of banks do the same. They get you to come in with the hopes of making it big. They will even give you extra money for bringing your book of business. After 3-6 months they either fire you or you are so burnt out you quit. Keep moving forward and following your dreams. Like you stated you are just not there YET!!
    Your Daily Finance | Thomas recently posted..Damn Kids Are Expensive and Eating All My FoodMy Profile

  16. You’ll be one soon enough, I’m sure. You have the drive and the motivation. It’s great that you like your job though, so you’re not desperate to get out.
    Tushar @ Everything Finance recently posted..Everything Finance Monthly Round Up: Student Loan Interest Rates Will DoubleMy Profile

    • I think having a job helps with my motives. I’m not 100% in it for the money, mostly, I want to help people invest well. And start by getting them on a budget so they CAN invest.

  17. Great article. You know the phrase, “when the student is ready, the teacher will appear” – well, it’s applicable here. You’ve already helped many, many people (including me and mine). You’ve got talent (and more specifically, a knack for helping people with financial planning) AND, more importantly, you’ve got integrety. You’re already on the path and almost there – you just don’t know it yet. Give it time ’cause it IS going to happen.

    What do you think about starting off by charging a modest fee for those budgets you so love to make? I’ll be your first paying customer. I already owe you and I told you that spouse and I are more than happy to write you a letter of recommendation. Kindly consider this our first e-letter of recommendation. And if/when you need more, let us know. You’re already there – all you need to do is tweak it a bit. Best of luck – altho I’m quite certain you’re not going to need any luck.

    • Jim, thank you again for the very kind words of encouragement. You know, I thought about charging for budgets, but I think about it as giving back, as I’ve been pretty darn blessed in my life. I have charged for a full sit down financial coaching session, but mostly I do it to see people’s lives change.

      As far as a letter, I don’t have an application for it at the moment, but maybe a short testimonial that I could put up on my “Budget Friday” page would do. I’m wanting to reach back out to those who have done it and see how far they’ve come 🙂

      Either way, don’t feel obligated, and I’m glad I could help 🙂

      • Jacob,
        I’ve been thinking about your response for some time now. I think what you need to realize (for the sake of your family’s financial well-being) is that there is nothing wrong with charging people $ when you’re helping them out. That’s how the world works and there’s nothing wrong with that.

        Send me your street address and I will send you a check for the wonderful advice you’ve provided for me and my family. Cash that baby – go spend it on YOUR family and reap what you have sown. I’m betting that the first time you get a taste of that any hesitancy you may have re: charging your “clients” will go right out the window.

        Please do this. At least just this one time. I’ll send you a check and if you can’t bring yourself to spend it – give it to your wife. I’m quite certain she can. Once you get a taste of “it’s not wrong to prosper from your God-given talents”, I think things will unfold for you and yours very well.

        Seriously, you can even just send me a post office box # if that works better for you. But, you must make me 1 promise and that is to spend the check I send you on you and yours and “reap what you have sown”.

        You sound so much like our kids. I am just so happy to see that others have raise their kids as well as we have raised ours. Come on – take a chance – run it past your wife. I think you’re ready to embark on a whole new (good and holy, decent and kind) adventure.
        Sincerely,
        Jim

Trackbacks

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