If you’ve ever considered a career as a financial advisor, there are some things you’ll want to consider before jumping in head first. There are definitely some perks like being your own boss and earning what you’re really worth, but there are some pitfalls too.
Here’s a look at some of the pros and cons of a career as a financial advisor to help you make your decision.
The Up Side
You can be self-employed. While working for a firm, either public or private, is an option, so is working for yourself. You can set up an office at home to save money on office rental and even set your own schedule in a way that works with your lifestyle. If you don’t want clients coming to your home office, you can set appointments at their home or office and go to them.
There’s no salary limit. Working in another field usually comes with a salary based on your experience and the company’s pay schedule. As a financial advisor, you set your own fees for services you provide and even earn commissions on products you sell. Your earning potential is up to you.
Start-up costs are low. If you’re going to be self-employed, this is definitely a plus. Of course you’ll have to pay licensing and other business fees, which can be a little costly but are usually a one-time or annual expense. As far as your monthly expenses, you can keep these to a minimum, especially if you work from home. Monthly website fees and a little online advertising can cost about $300 – $500 a month.
You get to help others. Whether you’re working with individuals or small families, you can help them reach their goals of buying a home, saving for their child’s college education, or putting money away for retirement instead of living paycheck to paycheck. A job where you get to do something useful and help others is a great way to spend your days.
The Down Side
There’s a lot of stress. In order to be successful, you have to be great with numbers and a pro at multi-tasking as you’ll be switching from one thought to another all day long. The only way to make more money is to take on more clients, which leads to more stress. You have to learn how to manage your day instead of letting your day manage you.
You need to meet specific requirements. Depending on where you live, your state and even your county will have licensing and certification requirements that you will have to meet. You may need a college degree or special training. And in most cases, you will need to be sponsored by a brokerage firm which means you’ll need to work for one for a bit. Most brokerage firms will require a contract for a certain amount of time, but they may also provide you additional training and pay for your fees.
You have to be a people person. While you’ll begin receiving referrals at some point, finding clients of your own will be difficult in the beginning. You have to be committed to going to networking events, calling people, asking for referrals, and marketing your services. This can mean working a lot of hours when you’re just starting out.
There are certainly some great perks to being a financial advisor, but there are some challenges to consider before deciding to make this your career choice.