Recently, I've been thinking about trying to become a CFP and wanted to know if any posters were in this or similar fields and how they liked it.

I graduated with a degree in finance but really didn't have much passion for it and my job since then has had nothing to do with that. However, I've had some major life changes recently and have been considering a change in my career. It all started with a convo between my gf's sister and BIL about personal finances. I've always been pretty frugal and don't fall in to the same dumb spending habits that others my age tend to make. However, I realized how foolish I had been with my investments (or lack thereof) and that my net worth could be a lot more at this stage in my life if I had done even a little bit of research. But through this convo my interest piqued and I started to enjoy learning about finances and what it takes to become financially secure/independent.

And then I started thinking about it as a potential career. I talked to a fee only financial advisor and she explained to me the difference between that and an advisor who gets paid based off of investment products and the conflict of interest that could result. All this was new to me but I thought becoming a fee only advisor could be a rewarding career. Not only is it a job where I could apply everything to my own life but the thought of helping people with their economic situations seems appealing.

I've just moved to a new city and would love any advice anyone has for me about the best steps to take. Should I try and get a job selling financial products just to get my foot in the door? Is it best to try and get certified first or are companies likely to help pay for this? Most importantly, is it an enjoyable career?

TIA for any info

TLDR; thinking about becoming a financial planner, no experience other than a degree in finance. Anyone have any advice on how to get started or anything they'd like to share about the job

There are a few here that should be along shortly.

It can be a very rewarding career...I get to help people daily and enrich their lives in multiple ways impacting the things they care most about.

The main struggle for most is how to get started. I recommend you find your local Financial Planning Association chapter and go to a few events. Meet some folks there and ask to visit about this topic over coffee.

I love what I do. I would highly recommend looking into this field.

It is very difficult to start. If you want control over your income and time, it will be a difficult 4-5 years. There are places hiring CFPs to be on a team. You will have more consistent pay, but lose the control of income and time.

I am more than happy to speak with you in more detail. PM me.

You'll also need three years experience before you can use the title. During that time you can study and take the tests, but there's an experience requirement as well.

Yes, went through the transition from a corporate finance/procurement position to a fee-only RIA a few years ago.

1. I would suggest taking the first class in the CFP curriculum (Intro to Financial Planning I think). You can find a list of schools on the CFP board's website, and the cost should be around $600-$700 but very worthwhile as it provides an overview of the whole curriculum and a taste of the different parts of the profession.

2. I went into it knowing that being a fee-only fiduciary was the only way I was willing to work in this industry. I'm not saying it's 100% conflict free, but I didn't want to be a salesman of certain products. There is still some sales pressure in terms of bringing in clients (and AUM) but I like the freedom of doing what's in their best interest, as opposed to the firm's. Be careful here, as many firms will try to equate this with 'fee-based' or even misuse the term fiduciary, but if you work for a broker-dealer you will be constrained to selling them certain types of funds and products. If I want to buy the best truck for me, I don't want to be limited to only what is on one dealers lot.

3. Be prepared to take a significant pay cut initially. For me it was about 40%, as the market for new financial planning associates is largely driven by recent college grads who have shown an interest in personal finance or perhaps took a few undergrad classes in it (at A&M or Tech). As such the starting salary is not very high, though it is possible to negotiate certain incentives and revenue-sharing (i.e. I receive 50% of the fee for clients I bring to the firm). After passing my CFP exam I received a 20% raise, with another 20% bump when I officially could call myself a CFP a year later, so I'm about back to the six-figure corporate salary that I left. No regrets though, as my wife can tell I'm much more satisfied day to day in what I'm doing.

4. You can actually earn your CFP in two years flat IF you are working under an apprenticeship model doing all six parts of the financial planning process at a financial planning firm. Note that most broker-dealers will only have you doing one or two parts of the process, hence the standard three years.

Hope this answered some of your questions. Good luck!

How old were you (and any one else) when you entered this profession or made the career change? Would somebody transitioning into this career in their late 20's or early 30's be significantly disadvantaged?

Moved into this career as a fee only RIA in the last few years and became a CFP in the Spring 2017 testing cycle. This is a 2nd career for me. 26 years in my previous career and I love what I do now. Couple of things.

1. The education requiremente can be met through many schools that charge $x,xxx for their total program. A&M offers the educational requirement and it is a bit different - $525/class. Nathan Harness, the director of the program, is exceptional. He teaches several of the classes.

2. As some have stated above, I love my job. It is nice to leave corporate and work for a small firm where I control my time, schedule and actually help people while doing what I love. It is very rewarding.

3. It is not easy and it is a people business - not just a numbers business.

Let me know if you have any questions.

Aggiewes '87

Thanks for the info, everyone. Much appreciated.

Harkrider, I don't have stars so I can't PM, but if there were some way we could exchange emails, I would love to learn more from you.

Another note: I could potentially be moving around quite a bit the next few years. My gf has started a very good career in a 3 year rotational program so that could very well mean 3 stops in 3 years. We've discussed the possibility of me staying put in a certain location for a year longer if I really like my job, but let's say I do move around this much. Great to experience different parts of the country, but how much of a hinderance would it be for my career path? Would it be best to just concentrate on getting experience wherever I am and worry about the certification later?

One final question for now. What's the best way to get into the field/what kind of roles should I be looking for? More specifically, I don't want to be a fee or commission based advisor but is that something I might have to do to get started? So far, most every job opening listed is a fee based position but maybe I'm not looking in the right places. I'm mid 20s and have no experience, just the degree. At this stage, should I just worry about finding a job in the industry and see if I even like it before worrying about becoming a CFP?

Again, thanks for all the help. I know I might be all over the map here but any info is greatly appreciated

Aggiewes, is this A&M program offered online?

Wife is an Aggie said:

---

How old were you (and any one else) when you entered this profession or made the career change? Would somebody transitioning into this career in their late 20's or early 30's be significantly disadvantaged?

---

I moved into it at 30. There are times where I wish I would have started earlier because I would then have over 25 years in the biz. However, being 30, I was more mature and confident. People assumed I had been in the business longer.

I don't mean to offend anyone on this board, but now seems like a terrible time to become a CFP unless you have a passion for it. Fees are getting compressed, robo-advisers are springing up to help with financial planning, the trend toward passive funds / ETFs etc.

In my humble opinion, there will always be a place for good CFPs in this world. I have several friends who became private wealth managers after business school at prestigious institutions, but they acknowledge the fee compression and disruption in their field. Many financial institutions are increasing their minimum required assets for new customers.

We are currently going through one of the largest transfers in assets in American history as the baby boomers' estates are transferred to their 40 something year old children. My generation is less likely to keep their parents' financial planner. As an example:

I have a meeting scheduled for Tuesday to reduce the capital of my wife's financial planner as a good portion of her municipal bonds were called recently. I am going to tell her FP that we are going to move the money into Vanguard where passive investments are significantly cheaper. There is too much literature showing that most active managers cannot consistently find enough alpha to justify their fees.

As a former holder of a series 7 and 63, I believe that determining suitability and educating your clients on diversification and market fluctuations are the primary value of a CFP. Let me know if I am incorrect, but suitability is moving towards robo-advisors, although human involvement is always helpful. Again, a good financial planner is worth their weight in gold if they can keep you from making mistakes and pulling your money out of bad situations. In my opinion, it will be harder to justify a good fee for that education.

TLDR: Lots of changes in the asset management space that will impact CFPs. Only go into it if this is a passion.

You have to have experience and the education/testing to earn your CFP. Waiting at least two years before starting your CFP would be wise. One, you may not like the biz, and two, if you are mostly on your own, you won't have time to study.

As for moving around, you should work for in some sort of financial planning or investment house as a team member. I wouldn't try to build my own business if I was going to move. Maybe someone like Schwab or Vanguard are easier to relocate with. If not, look to hire on with another outfit similar to them until you are pretty sure you will be permanent.

agedjones at yahoo dot com

Harkrider, got your email.

I will reach out to you once I gain more knowledge but so far everything has been very helpful. Thank you.

AgBank, you touched on some of the concerns I've had. And that doesn't include the bit about robo advisors. Although hearing that doesn't come as any real surprise.

My gut feeling is that there will always be people who are very uneducated with their finances, rich and poor, and even the smallest piece of advice could go a long way. Furthermore, if I get a decent job, learn all I can in the near future, and then decide it's not the career for me or it doesn't look like a promising field, at the very least I will have a vast amount of knowledge to apply to my own financial situation.

AgBank said:

---

Let me know if I am incorrect, but suitability is moving towards robo-advisors, although human involvement is always helpful. Again, a good financial planner is worth their weight in gold if they can keep you from making mistakes and pulling your money out of bad situations. In my opinion, it will be harder to justify a good fee for that education.

---

AgBank, you are confusing the suitability standard with what it means to be a true fiduciary. Robo's cant be a fiduciary and if you haven't noticed that model is not proving profitable (for everyone except Vanguard).

Fees are incredibly important, and our firm has people 80% in Vanguard for that reason. Also agree completely on the research behind passive indexing, which we also believe in. But what you are missing is the intangible value an advisor brings in multiple ways. Vanguard actually tries to quantify this through their 'Advisor's Alpha' research which you can find through google. Everyone is focused on investments and returns, but what most people don't realize is the significance of the behavioral component. Advisors help mitigate that and prevent poor decisions in terms of buying or selling at the wrong time.

Neutics, thank you for the reply!


I don't think robo profitability is very telling as it is somewhat nascent business. I believe the robo-advisor is more of a tool than a replacement. Text books didn't replace professors etc.

Learning "don't sell when the market drops" isn't worth 50 - 100 bps in today's environment.

Part of the problem of the current AUM fee structure is inflation is around 1%. With expected returns (Shiller's CAPE or bonds etc.) at such a low level, it is hard to justify paying for the behavioral component. It made more sense when expected returns of a balanced portfolio were closer to 8%.

AgBank said:

---

Neutics, thank you for the reply!


I don't think robo profitability is very telling as it is somewhat nascent business. I believe the robo-advisor is more of a tool than a replacement. Text books didn't replace professors etc.

Learning "don't sell when the market drops" isn't worth 50 - 100 bps in today's environment.

Part of the problem of the current AUM fee structure is inflation is around 1%. With expected returns (Shiller's CAPE or bonds etc.) at such a low level, it is hard to justify paying for the behavioral component. It made more sense when expected returns of a balanced portfolio were closer to 8%.

---

Studies from everyone, in any time frame, and every country show investors without an advisor get 1/3 the return. This alone tells me it doesn't matter what the returns may be. It also doesn't come close to defining many of the other benefits people can get from an advisor (taxes, proper insurance, etc.).