Why Isn't Wealth Management More Popular?
As long as you have social skills beyond a literal primate and the ability to read the markets at a high level, $1M a year seems to be relatively attainable. Compared to the hours of high finance, why isn't this a more popular route?
B/c it is a riskier and less transparent path to making dough. in IB u can just be a good boy / girl and grind ur way up at least to a certain point collecting established paychecks and doing repetitive tasks. in wealth management u have to be much luckier and opportunistic while relying on soft skills in a world where it is more winner eats all. re-arrange logos on a powerpoint slide while collecting $200K+ at a minimum for 7+ years or do wealth management? decision is ez.
Gotcha. You think it’s the upfront years of shit eating and poverty that steers people away?
I’m asking cuz my buddy’s dad clears close to $3M in management fees and works like 30 hours a week which to me is nuts. He’s not super charismatic or the smartest. So wondering why more people don’t go down this path.
your buddy's dad is a whale and survivor so you are witnessing survivor bias. its less the shit eating and more the lack of clarity in career progression. like i said, you can figure out how to model out financial statements yourself but how do you learn how to convince rich people to trust you with their finances? how do you learn how to develop the network and relationships to maintain and grow your client base?
I'm gonna assume this has some level of cap to it without any additional info.
Because of the hardos on this site who think it’s boring and doesn’t make money.
I'm from Switzerland where WM is huge. Very respectable and well earning career path. However, there are some reasons why it has not the same attraction as IB:
Hope this helps
Private wealth management is literally just tricking old people. Everything they do in 95% of the portfolios/accounts they manage you could do yourself in Schwab within 5 minutes. Huge scam
I interned at the largest PWM firm in my city during high school and this is what it felt like to me. Like all the partners were pulling in high 6 figures but their actual job was literally the simplest thing and even as a high schooler I noticed that. I sat in on a few meetings and it literally felt like chatgpt and Schwab could do a better job if you gave it a good prompt with ur goals
there's a big difference between advising people with $500k net worth and $50m net worth
Because I don’t want to be shilling annuities and mutual funds to old people. I’d much rather rip off PE firms and corporations instead :)
There's something that could be said about the behavior component of investing as the average retail investor substantially underperforms the market whether through market timing (waiting for a crash / selling off during a crash / putting all their money into subpar stocks or etfs)
I think the service itself is pretty useful for a lot of people, but the job itself is not glamourous. You're essentially a financial therapist.
You're either shilling bad products or convincing people to stay invested in the SP500.
That being said, I'd rather be a financial advisor with a good book then have pretty much any other job in finance
I don't think fees will be nearly as good going forward. I believe they've already seen a fair bit of compression...
That's the case across all segments of investment management, firms vulturing for more business.
Fair points but always seemed like an uninteresting field to be in long-term, personally. Wealth management just consists of taking the ideas/strategies from PMs that actually manage assets anyway. If you had a strong book over the last 15 years you were making racks collecting management fees while giving your old, rich clients a "specialized" portfolio that just tracks the S&P 500 and maybe slightly overperform. It's hard to lose your job if you're spamming the index all the time, that's when it gets boring. But hey at least you golf more than your freshly graduated friends in IB and you actually enjoy existing.
Neque excepturi dolorem dicta. Autem qui sint quis ea voluptatem. Sit officia omnis sint. Ab recusandae sed dicta corrupti quia ut.
Distinctio harum quaerat velit aut. Non ut minima aperiam voluptas. Rerum voluptatem autem voluptatem ut et quis nihil.
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...