Am I Lying to Myself?
Hi all,
I currently work for a Financial Advising Wirehouse in Orange County, California. The team I intern for has about $650AUM divided between 2 FA's and a CSA. The life of every FA in this office seems pretty sweet. Averaging maybe 35-40 hour work weeks, assuming a comfortable salary based off the watches, suits, cars, and pictures of homes I've seen.
It seems like a pretty solid gig, but why are there never any posts about financial advising on here. Sure you're probably not pulling anywhere near 7 figures unless you're one of the few... but mid 300's to mid 400's doesn't sound half bad, nor really that implausible considering what I've seen.
Am I missing something?
Warmly,
James
You're on the wrong forum. A FA is WM. Yes, you can make a nice life being a leech on other people's money. Max payout is about $1m/yr. You have to have no scruples to make it happen, however. As long as you can keep pushing those VAs on little old ladies and DOL doesn't eat your lunch, enjoy it.
A few thoughts:
1) You're looking at the top - a lot of jobs are sweet at the top. Once you've built your business or your expertise, it's easy to build a team under you that can support and work to your lifestyle. But focus on the path there - what are junior guys doing? Do you like what they are doing? How do you get to that point? Does it just get handed to you or do you have to build a business? What's salary progression to get there?
2) Is the work something you want to do? There's work and life after work - totally fine if you pursue life after work more than you do work itself. But if you're going to spend 40 hours a week regardless, make sure you like what you do. Cold calling? Dealing with high volume of clients? Making a lot of sales pitches? Less sophisticated investors/demanding clients? Those are all what I assume would be part of your job. Would you rather be looking at income statements/balance sheets or doing M&A deals?
3) Career exits - if you find that you do want to do something else in finance (i.e., banking, PE, institutional AM, etc.), it's hard to rotate from FA to those gigs. Most likely you will have to get a top MBA to rotate in. So if you have any other aspirations in finance, I think you should pursue those now rather than later. A lot of people want career optionality and they get that through more intense experiences (like banking) when they are young. IMO you're giving up a lot of that if you pursue FA right out of college.
If you're at an FA now and you think it's the perfect job for the next 35-40 years, then no, you're not lying to yourself. But I'd encourage you to think about all aspects of it and poke around what other career opportunities look like to make sure that it's what you really want.
I go to a non-target. I've got a less than stellar 3.5 GPA. But I am extremely well rounded (founded 2 clubs, serve at a very posh/unique restaurant, fraternity president, etc) and can actually flourish in an interview setting unlike 85% of my classmates that I've came across. I work about 52 hours / week (18 internship, roughly 30-35 restaurant, not because I need the money, but because I absolutely love the job), and have 12 months left of school.
Coming from a non-target w/ a relatively poor gpa, I acknowledge the iBanking -> PE/HF route is rather implausible.. But I could get a letter of rec from an MD, and am pretty sure I could learn anything needed to know for an interview in 2-3 months (my summers about to start so hey why not actually put the time to use right?).
Given this info, if there were another path you would recommend I strive for until graduation, what would it be and why?
Appreciate your time.
Best,
Smalls
I went to a nontarget school, with only a handful of alumns in FO positions. Your GPA is better than mine was at the time... Literally not as difficult as you think it is to get a role that is in high finance, its definitely harder but no where near impossible... I did a PWM internship, Business Property Tax Consulting Internship and wound up in Asset Management as an Analyst. Calm down! Breathe! Look over all your options and network! Figure out what networking really is and it'll be your best resource at landing you a good role... not your gpa nor the school you are from..
I've got two really good friends that are FAs. They've been doing it a couple of years now and they probably put in 50 hours a week, but when they were starting out they were calling/setting up meetings for 60 hours a week and then they'd put in another 10-15 hours on other stuff while they're making a really low salary to start (sub 30k in a reasonably affordable city, went away after a year) and trying to sell insurance so they can get those credits and make some money. At the end of year one they had both pulled in about 70k and were pretty much a lock to pull in over 100k in year two. Since these guys are/were right out of school, once all of our friends/their friends get older and move up a bit more, they'll start managing money (in very passive vehicles) and they'll make a couple hundred grand. As you said, good money and definitely more than enough to have nice stuff, plus you pretty much don't have to work, and when you do half the time it's playing golf and making a couple phone calls. Very good W/L balance imo.
But they and one other guy are the only ones left of their year (they've seen at least 15 leave since they started). So if you're a super personable guy and you are okay with very repetitive, grinding work that takes zero thought, then it may be for you. But it's far from certain that you'll like it and/or be good at it.
I don't think you are wrong about being a partner in a practice of that size being a good gig. The great thing about PWM is that it is a very sticky business, and once you are able to gather enough assets to live comfortably, what you do with your business is up to you...do you want to grow to $1 billion and build out a full team? Or do you want to stick with 2 partners and continue servicing your existing clients and live a great lifestyle with a $650mm book of business?
The downside is its very hard to get to that point, especially today with increased competition and if you are going at it yourself. If you are able to join an existing team like the one you are on, it could be a very lucrative long-term opportunity.
As mentioned, the key question is to figure out if the work/lifestyle is something you could see yourself doing for the next 30-40 years. For what its worth, I know several senior FA's who love their work and plan to continue into their 70's - not just because the money is good but because they have built great relationships with clients over the years and enjoy the day to day aspect.
I've written countless posts on the industry, check my history. I love PWM, I doubt I'll ever leave.
WSO users don't know as much about PWM as they claim. that being said, I can corroborate what saxxyman and Minnow4 are saying
Minnow4 saxxyman as well...
Sorry for being on multiple accounts lol. I have 4 or 5 to disperse identity. Not that it really matters. But better to be safe than sorry.
Anywho, 2 more questions if you will~
1) I'm currently wrapping up my junior year of college. I've only got 3 finance related courses to take to finish out, but will be staying put for the final 2 semesters in order to go "the full 4." Aside from finance related coursework, I'm trying to take as many tax and psychology classes that I can, as I find that will be the most applicable to this career path. Might there be anything else worth looking into that you can think of? Or maybe courses you wish you had looked more into when you were this age?
2) I've been told that both of my bosses from my current and prior internships would like to bring me into their teams. The first was at a boutique firm, and in that case I would be taking over my bosses old book as he retires out of the business. (About $375MM AUM, he was a partner, each manages their own book entirely on their own, just share the office & branding). Current gig is at a wirehouse for about $650MM that seems to be ra[pidly expanding, if I stayed here I would work under my current boss spending my first 2-3 years or so becoming as credentialed as possible. And then from there, begin to build my book under them. I'm really not too sure on what either of the paths would look like, obviously from my lack of description.. But could you explain what the differences and commonalities would typically be like between the two, and if there is, what my preference should be? Haven't really talked in depth with either side about this as it is still over a year away and I don't want to get too ahead of myself. But, it would be interesting to get a little more knowledge before I seriously delve into these conversations that are coming due.
I appreciate the responses, and warmly welcome any and all input.
Best,
Smalls
no regrets from my college days. this is a relationship business, spend time getting better than that. hint: that doesn't happen in the classroom necessarily.
impossible to evaluate, the wire obviously has more revenue to throw around, which is attractive. get a clear sense of the offer, communicate excessively (this is the key to good partnerships), and make sure everyone knows what expectations are of you and what success looks like. lack of clarity will lead to disastrous consequences
I live in a wealthy area, and yes, I know several financial advisors who are pulling in over $1 mil per year and plenty others making $400 - 600k per year. The problem is, you are on a forum which consists mostly of kids who want to get into investment banking, and therefore don't understand wealth management. Let me correct some of the false things people here have said:
1) It's all about cold calling. No, not exactly. It's all about sales and relationship management, but how you go about that can vary from person to person. If you want to spend your days cold calling, then you better do A LOT of cold calling because you will have a very low success rate. But the people on here don't understand that if you work in wealth management or investment banking, deals and relationships are often made over the phone - that's how it works. Most of the people on this forum are analysts working on the underwriting, but someone has to originate those deals, and first contact is often made over a cold call. So whether it's investment banking or wealth management, cold calling usually plays some role in the sales aspect.
2) You have no career exits. This depends. If you're really good and prove to be a successful financial advisor, then you have nothing to worry about. You can stay where you are collecting nice commissions and huge bonuses, move to another wealth management firm, or start your own wealth management firm. I'm not quite sure why you would want to leave if you are successful, however you can also move into business development for a hedge fund or you can just start your own hedge fund because you have the investors to do so. If you're not successful in wealth management it becomes hard to find where else you might be able to go. If it were me, I would look towards institutional sales as you would already be licensed for it.
3) You'll learn nothing about finance. This is entirely up to you. You can place the majority of your focus in just sales and not focus on anything else, or you can learn about the markets and how to trade. I have met plenty of senior investment bankers that don't know jack about finance, but rather they spend all their time on originating deals. So they have the sales pitch and relationship management mastered, but their knowledge of investment banking is minuscule.
It's a great job, if you can scale. "Winner takes (most if not) all" type of industry.
There are two things I wish posters would do less on WSO.
1) Rag on themselves for being non-target and not having a 4.0. Unless you're actively going BB IB or MBB, "target" has little meaning other than to describe a non-exhaustive list of great schools.
2) Worry about whether bankers respect a particular industry. Saxxyman's points are solid, but generally you don't need to worry what some random M&A bruh thinks
Qui saepe laboriosam voluptas cumque et. Fugit tempora eligendi illo ut est esse assumenda ut. Quia aut qui odio doloribus qui voluptatum ipsam rem. Qui rem quaerat qui eaque voluptas ut. Dolores aut vel doloremque vel aspernatur rerum. Quidem aut eos eum veritatis. Non esse quia culpa eveniet est eius illo.
Consequatur alias sunt aliquid repudiandae. Nam qui quia praesentium quia et occaecati. Deleniti ipsam magnam id deserunt officiis nihil quisquam.
Consequuntur qui delectus sunt est harum illo. Suscipit neque rerum nemo rerum. Veniam ut voluptas consectetur explicabo praesentium.
Odio vel at ut officia aut. Corporis et fugit unde velit. Id in et rerum sunt esse. Eum perferendis nisi rerum quia consequatur. Eius quas placeat repellendus autem. Assumenda et excepturi placeat suscipit amet nobis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...