Today, I want to tell you what no one tells you about being a financial advisor. Time to think like an investor.
And I’ve actually been in the business now for for almost six years. And like many of you guys, if you’re thinking about doing this as a career, I was kind of petrified at the start. I didn’t really know what was going to happen.
I was very apprehensive. I knew that if I didn’t produce, I wasn’t going to be able to pay my bills. These might be a lot of the things going through your head, but everybody knows that. Everybody knows it’s going to be a grind.
And everyone knows that you’re going to have to start from scratch and you’re going to have to build your own business and there’s going to be challenges. But one of the things that no one really tells you what are the struggles that you’re going to go through that no one ever mentions and maybe they keep from you, they don’t even want to mention.
Now, in this career, there’s going to be many different challenges that emerge at different points in your career. And I think the first one that really comes to mind is that when you start in the business, there might be some manager or supervisor who requires you to go out and think about all the potential people in your network or in your phone contacts.
In contacts. That was wild. Phone contacts, the people in your social media, and try to think about who might I be able to get as a client? And you’ll go and you’ll collect all those names, and part of your job in the first year is going to be reaching out to all those people.
And here’s what I found that no one really told me and that I didn’t really expect. You see, when I got into the business, I had this list of people that I thought I would be able to start working with and that I was excited to start working with and who verbally committed, they said, absolutely support you when you start.
Like, I’ll help you hit the ground running. We’ll get working together. I need someone like you. And then, of course, push comes to shove and it’s time to actually reach out and do a deal or you’ll. You know, work with somebody and guess what happens?
They say, Ah, you know, things aren’t right right now. You know, the wife has reservations, this and that. And you realize that maybe only ten to 25% of the people who actually wanted to work with you when you thought you were ready to get started in the business end up committing.
So one thing I think you need to realize is that talk is cheap, especially before there’s any commitments made. And what you need to think about going into the business isn’t, oh, look at all all these prospects I’ll have ready to go.
It’s these likely won’t pan out, and I’m going to have to rely on myself to put myself out there and do some prospecting and go meet people and try to stir up some business. Once you’ve got past the problem of getting those initial clients and maybe you’re starting to have some success, we’ll call that maybe year two or three is likely.
When that’s about to happen, you start to produce and people around you start to catch notice that you know, you’re making your way and you’re starting to make money, and your managers and your bosses are starting to take notice.
And what you’ll realize is you start getting invited to the parties and you start getting invited to the sports games and the outings and all these sorts of things, and you realize very quickly that your importance to the firm or to the company was your ability to produce.
And you realize very quickly that you might actually be a cog in a marketing machine. I think at the end of the day, a lot of these financial services companies are for profit companies. They’re public companies with responsibilities to shareholders.
And what that means is you go into the business thinking, I’m going to help people. I’m going to save people from their financial woes. I’m going to get people invested and help them build wealth and all these sorts of things.
But you realize that the further ups are more concerned that you’re selling product. And that’s something that really took me off guard, because I thought we were all in this for the right thing. We were all in this for the right incentives.
And that’s exactly what I want to get at here, is that we all think that we’re really good, good people until we’re given a really bad incentive structure. And if you are actually incentivized or bonused or given opportunities, if you do the wrong thing for a client, let’s say sell them something that makes you more money, but that the client doesn’t really need you’re.
You actually get praised in that incentive system. So one thing that no one really tells you about is there might be situations where there are bonuses or referrals or things in the business that are incentivizing you to do the wrong thing.
So you have to be on guard, ready to kind of stand your ground and make sure that what you’re doing is right. And as weird as that sounds, you’ll find very early on that there are incentives that are going against you and your clients.
Now, another thing nobody really mentioned to me was that, you see, you get into the business and you start dreaming about that future where you control your time and you control your schedule, and you’re making enough money that you’re making more money than you really even need to spend.
And business is good and you’re being referred, and you think that’s kind of like the finish line. It’s the promised land. There’s no more problems there. But what you realize is something really interesting that I think a lot of my clients realize and people I speak to realize is that once you get to this level that we might call wealth, let’s say, where your passive income from a business or from a real estate property or from an investment starts to actually outweigh what you spend.
Aka. Your passive income outweighs your expenses. Now you’re in a position where you don’t exactly have to work. You’re not really forced to put on a full work day every single day. And you kind of lose that sense of meaning that you had when you were building those first five years.