Success as a financial advisor requires that you practice as a financial advisor. Most people unfortunately who practice as financial advisors aren’t really financial advisors. At best, they’re portfolio managers. At worst, they’re salespeople looking to score big commissions. That’s not what I mean when I use the title financial advisor, and it’s certainly not the measure of success in this field.

The problem is that no single standard authorizes someone to practice as a “financial advisor.” Unlike other professions including medicine, law, and accounting, financial advisory has no single governing or regulatory authority charged with their members’ oversight. Doctors have medical boards, lawyers have bar associations, and accountants have the Financial Accounting Standards Board (FASB), but financial advisors have no equivalent. As a result, you can find plenty of people in this profession who, for example, sell only insurance products or who are raising money in an unregistered private placement investment offering. No wonder that consumers are so confused and leery of financial advisors; too many who operate under this designation are just commissioned salespeople, not actual advisors.

When I say success as a financial advisor requires that you practice as a financial advisor, I mean you can achieve success in the profession by always placing your clients’ needs above yours and by providing superior comprehensive and cohesive financial advice. This advice covers all aspects of a client’s family finances, including buying a home, paying for children’s education, saving and investing for retirement, protecting assets against unforeseen tragic events, reducing the client’s tax burden, and more. Simply put, you achieve success as a financial advisor by delivering consistently superior holistic service to your clients. With this point of differentiation, you can just about corner the market wherever you practice.

About This Book

Welcome to Success as a Financial Advisor For Dummies, where you discover how to achieve your success by helping clients achieve theirs. The two key terms in the title of this book capture what this book is all about:

• Success means not only financial success, but also personal satisfaction, job satisfaction, self-respect, and personal and professional fulfillment. The more you work with clients, the more you realize that money and what it buys is only one key component in achieving happiness and fulfillment. My guidance in this book, just as the advice you give (or should give) your clients, is holistic. By following my advice, you can achieve success in your career however you choose to measure it.
• Financial advisor means a professional who delivers holistic financial advice to clients and upholds the fiduciary standard — always advising and recommending products and solutions that are in the client’s best interest and with total compensation transparency.

This book covers all aspects of being a successful financial advisor, from deciding whether you’re a good fit for the profession to starting your own firm and everything in between. To make the content more accessible, I divided it into six parts:

• Part 1 brings you up to speed on the basics. Here, you conduct a self-assessment to figure out whether this is the right career for you, decide whether to join or firm or start your own practice, and scope out the regulatory landscape.
• Part 2 guides you in developing the foundational knowledge you need to practice as a financial advisor. Here, I identify the core competencies, point you in the direction of where to go to obtain your formal education and get licensed, and explain asset and liability management, budgeting, estate planning, taxation, and behavioral finance.
• Part 3 leads you through the process of onboarding new clients, so you can target your services to their unique needs; developing a personalized financial plan for each client; and offering collaborative advice by teaming up with your client’s lawyer, tax advisor, and other professionals. Here you also discover how to tier you service to different clients to optimize efficiency and how to measure performance.
• Part 4 presents three ways to acquire and retain clients, the most effective of which is to earn clients by delivering superior service. I also provide guidance on how to market and network to raise your profile and how to team up with other professionals to improve service while expanding your referral network.
• Part 5 discusses how to transition from solo practitioner to business owner, structure and run your business, attract and retain talent through equity participation and other means, and develop a business succession plan to preserve your legacy in the event you choose to retire or you experience a situation in which you’re no longer able to run the firm.
• Part 6 features ten tips for achieving success as a financial advisor and ten tips for growing your practice. This part also includes an appendix that provides several lists of valuable resources, including professional development resources, professional licensing bodies, trade publications and resources, and business valuation and formation resources.

In short, this book explains first how to become a holistic, fiduciary financial advisor and then how to raise your game to build on your success.

Foolish Assumptions

As a financial advisor, or someone who wants to be a financial advisor, you should realize that all assumptions in this field are foolish and potentially dangerous, so I hate to admit to making foolish assumptions as I wrote this book. However, to keep the book focused on the right audience and ensure that it fulfilled my purpose in writing it, I had to make the following foolish assumptions about you:

• You want to be a financial advisor aligned with my definition of what that means. You don’t want to merely sell investment and insurance products and solutions to earn a buck.
• You’re committed first and foremost to each and every clients’ financial success in all areas of their financial life and what that wealth represents for each client and your clients’ family.
• Your knowledge of and experience in the field ranges from nothing to substantial. At any point in your career as a financial advisor, and even before you take the first step, you can benefit from the guidance I provide in this book.
• You’re eager to acquire knowledge and skills and willing to change, especially if you’re entrenched in bad habits and practices or stuck at a firm that doesn’t support the highest standards of practice. My hope is that this book will be transformative to most readers, setting them on the right path to becoming holistic, fiduciary financial advisors.

Icons Used in This Book

Throughout this book, icons in the margins highlight different types of information that call out for your attention. Here are the icons you’ll encounter and a brief description of each.

I want you to remember everything you read in this book, but if you can’t quite do that, then remember the important points flagged with this icon.

Tips provide insider insight. When you’re looking for a better, faster way to do something, check out these tips.

“Whoa!” Before you take another step, read this warning. I provide this cautionary content to help you avoid the common pitfalls that are otherwise likely to trip you up.

Where to Go from Here

You’re certainly welcome to read this book from cover to cover, but I wrote it in a way that facilitates skipping around. For a quick tutorial on how to achieve success as a financial advisor, check out Chapter 1, where I touch on the key topics. Review the table of contents or the index for a topic that piques your interest. Flip to any number of chapters and start reading. For an extra Cheat Sheet chockfull of interesting tidbits that you can refer to again and again, check out www.dummies.com/successasafinancialadvisor.

IN THIS PART …

Wrap your brain around what’s required to be a successful financial advisor.

Figure out whether you have the right characteristics to be a financial advisor, such as problem-solving, intention, and service-oriented.

Discover how to leverage your education, experience, and former career(s) to transition successfully into the role of financial advisor.

Weigh the options and make the call of how to practice — working for an established firm or starting your own business.

Get up to speed on the rules and regulations that govern financial advisors, so you can avoid doing anything that gets you into trouble and be positioned for where the regulatory and legislative trends are headed.