Financial Advisor FAQs

Are you a new or current financial advisor? Thinking about a potential career change? Or playing with the idea of branching out to start your own financial planning firm? You probably have many questions about the ins and outs of getting into the industry and starting your own practice. I get it because I was in the same place five years ago. And I know just how valuable it is to be able to pick the brain of someone who's gone through the process. 

I've spent a lot of time experimenting with different technology, techniques, processes, and strategies to create a one-of-a-kind client experience. I would love to share the insights I've learned with you. So I decided to put together the answers to the most frequently asked questions in order to help you out. Below I'm sharing how I operate and all I've learned about what works well and what doesn't. Let's jump in!

What services do you offer, how how is your revenue model structured to fit the needs of low-income clients? 

You can check out my service offerings on the homepage of my website here

It's important to me to offer various tiers of services. So the bronze package was designed to serve low-income clients and those just beginning to organize their finances. 

One of the things I ran into when I came into the industry was all the minimums, like "minimum assets under management" in order to be an ideal client for a firm. I was hardcore against minimums at first but realized over time why they are in place. I now have some soft minimums in place. However, they are much lower than traditional firms and unrelated to assets.

I don't want to turn people away. My passion is being able to serve people of all income levels, but how you serve them effectively differs for each one, and that's why I have three different service offerings to meet those needs. 

Do you have or recommend any certifications for aspiring financial educators and coaches?

Be leery of just trying to accumulate a bunch of letters behind your name. They only go so far. You really need to work on developing an expertise in a specific area, and that isn't always about certifications. For example, there is no certification for stock options, but I have a friend who spent significant time crafting that area and is a total badass.

Find the area you enjoy, get really good at it, and then make sure you can provide your clients with value. Work on becoming the go-to expert in that area. 

You can also earn a bunch of designations but be mindful of the continuing education and the cost involved. The more designations you earn, the more things you need to keep up with. Keeping that in mind, here are some designations that might be beneficial for you depending on your area of expertise: 

  • Accredited Financial Counselor (AFC) - I suggest getting this designation if coaching and working with lower-income individuals is important to you.
  • Certified Student Loan Professional (CSLP) - I recommend this program if you'll be working with young professionals and need to be knowledgeable about student loans. 
  • Certified Financial Planner (CFP) - Known as the standard of excellence in financial planning, the certification process requires education, exam, experience, and ethics. 

How hard is it to build a financial planning business? And what challenges do you still have today?

Starting a financial planning practice is HARD!

Today, I'm five years into starting Worth Winning, and I didn't pay myself until the end of year four. I recommend that you have at least $10k to make as an initial investment plus six months of business expenses and personal expenses before you jump off the ledge. 

One of the biggest challenges is wearing all of the hats related to the business. Not only do you need to be "the financial professional" but compliance, marketing, and admin tasks fall on you. And they're all continual efforts you have to make. 

Another challenge I continue to have a growing the firm while trying to build it has a "lifestyle practice." 

The biggest advice I can share from my mistakes is don't start out too cheap with your pricing. Recently, I've run into a nightmare while trying to raise my prices to market value for my services. I started too low and had to face losing clients as I raised my prices to where they should have been all along.

Was there a pivotal event or lightbulb moment in your life that inspired you to get into personal finance?

I joined the industry because as a client, I didn't feel I had the right financial professional. I saw the gap in the industry where young professionals were falling through the cracks and not getting the service they needed or deserved.

What are the most common money mistakes you see people making? 

Following the "trendy" financial advice that is not rooted in knowledge or in their best interest. Some examples include:

  • ​I am tired of throwing away money on rent, so I'm going to buy a house.
  • ​I want to get into real estate for passive income.
  • ​Carrying credit card debt will help me build my credit.
  • ​I need to start buying stocks, so I can make my money work for me.

What do you think the most important money lessons are for young adults learning to manage their money?

Saving and budgeting. This skill set is not taught in most certifications. I am a firm believer in having a process for saving and budgeting for yourself. The root of most financial decisions and the foundation of financial planning is having a grip on your cash flow. If you skip this as a skillset, it is hard to help clients reach their bigger goals. 

What is the best physical location in the community to spend your time for business development? 

I've found it's best for me to spend time in places where young money makers (my target market) hang out. Places that allow me to hear the conversations. Urban League has been a good place for me personally.

It's tempting to try to always work your business and sales pitch into conversations when you're just starting out, but I warn against doing that. Focus on just being in the space and listening to the conversation. Then go back to your office and create content according to the needs that you're hearing. Post blogs, videos, and social media posts that speak to the audience you want. 

What have you found to be the best use of your time to develop your brand's presence online?

I hate doing it, but I've found that video is one of the best ways to connect with an audience online. The algorithms are set toward video, so it's really a great use of time. I hate doing video on my own, so I started a podcast, which has brought traffic to my business. 

I've also found it really helpful to get on other people's videos. This way, I don't have to come up with the content. Instead, I'm in a Q&A environment and can just be myself. Someone else sets it all up and creates the images and all that good stuff. This also puts me in front of someone else's audience.  

What are the software must-haves for starting a fee-only practice?

I err on the side of simplicity when it comes to software. I recommend that you do a price comparison to see what makes the most sense for you. These are the things I feel are a must-have:  

  • A scheduling software - I personally use Calendly. Some people say that Schedule Once is more professional, but I have a young, fun practice, and Calendly is working great for me. 
  • Financial planning software is important - I previously used eMoney Advisor and have since switched to Right Capital. I found Right Capital to be more cost-effective, especially as a XYPN member.
  • Password saver - I use LastPass.
  • Way to meet with clients virtually - I use Zoom
  • Client intake tool - Precise FP seems to be the most popular tool for client intake information and creating other forms. I previously used Typeform and have since switched to Jotform. I've found it to be the best tool for me and my firm. 
  • CRM (Customer Relationship Management) - I started by using Wealthbox but have switched to using Trello for my CRM
  • Task Management - I also use Trello for my task management software for myself and my team. 
  • Automation - Zapier is great for helping to automate your process.

What types of things do I need to budget for when starting a financial planning firm? 

Along with the software above, here are some additional things you need to think about as you budget for starting your financial planning practice:

  • ​Website hosting
  • ​Investment analysis software
  • ​Microsoft Office
  • ​Hire Help
  • ​E&O (Errors & Omissions) Insurance
  • ​General Liability Insurance
  • ​Cyber Insurance
  • ​Compliance
  • ​Marketing (Business meals, Facebook Ads, Google Ads, client gifts, mailings)
  • ​Miscellaneous office expenses
  • ​Professional memberships and continuing education

How do I know when it's time to hire help?

You need to make sure you understand what your limitations are and what you're willing to give up in order to hire help. I hired help for Worth Winning before I ever paid myself a dime. I don't recommend this for everyone. It's not the most normal way to grow a business. However, I knew I was building a lifestyle practice, and there were certain things I knew I didn't want to take on myself. As a business owner, we need to be willing to scrub the toilets, but shouldn't always be doing it on a daily basis. 

Know what your limitations are and where your time is best spent, then look for the areas you can outsource. But realize outsourcing is expensive and may delay your ability to meet your own financial goals. You have to weigh your time vs money. Having a supportive spouse and side hustles were an important part of building my practice. 

What professional memberships do you recommend?

There are a ton of options for professional memberships. I'm a member of the following:

What financial industry conferences do you attend?

Conferences can bleed you dry. You want to be strategic about which ones you attend and how you spend your time there. Make sure you set goals before going to a conference. Instead of meeting 50 people, focus on building relationships with five people you'll follow up with.

Here are some of the conferences I attend. I don't attend each of them every year. 

  • Financial Freedom Summit
  • ​LLIS Conference
  • ​AFCPE Symposium
  • ​National Black MBA Annual Conference
  • ​ESPNW: Women + Sports Summit (because I serve athletes)
  • ​Invest in Women Conference
  • ​Sports Financial Advisors Association (SFAA) Annual Conference
  • ​FinCon
  • ​African American Association of Financial Advisors Conference
  • ​FPA Retreat
  • ​Local FPA conference
  • ​National FPA conference
  • ​NAPFA Fall and Spring Conference
  • ​XYPN Conference

What are the software no-go's to keep in mind when starting a fee-only practice?

This is really going to be a personal decision. Wealthbox didn't work well for me. I decide to create my own CRM using Trello instead. I recommend you think about the things that are going to be time wasters for you. And, of course, take cost into consideration.  

What are your thoughts about becoming an XYPN member? Were there any programs or XYPN-offered groups that you find impactful or a waste of time?

I think there is value in being an XYPN member. Here are some of the benefits I enjoy and have benefited from:

  • Helps you get set up and running without having to do it all yourself. While there are fees involved, cutting corners could cause you to make mistakes along the way. 
  • ​The registration process is organized and less stressful than doing it on your own. 
  • ​Access to resources and a forum with a knowledgeable community. This can be a game changer since operating in a silo can slow your growth. Your questions might be new to you, but there are plenty of people who have been there before and are happy to answer your questions for you. 
  • ​Mastermind groups to help you find your people and connect.

A few years into running your business, you may feel that you don't need to be a member anymore, but there are still significant savings for software when you're a member. Many of my peers have also decided to remain in XYPN after doing a cost analysis. You'll spend more on the software individually than the monthly fee of being a member. 

How did you set up your financial planning website?

I've had three very nice websites but found the process for creating them was always a nightmare. I don't have a recommendation for a website designer. I'm not a DIY person, so this was something that I outsourced each time and found it to be worth the cost. I recommend that you plan on spending at least $1,500 to get a good website in place. There are many options to DIY your website, but if you're not experienced in this area, it's very time-consuming. 

One thing I do NOT recommend is using Joomla to set up your website. Stick with something more mainstream like Wordpress. You will thank yourself if you have to switch to various website developers. Not many work with Joomla. 

How do your financial planning clients pay fees?

I use AdvicePay through my XYPN membership. This allows clients to pay via credit card or ACH. I have chosen to allow them to pay monthly or quarterly, whichever they choose. 

Do I need an LLC for my financial planning practice? Should I be an S-Corp? How do you set up an LLC?

You can go online to the state government for whatever state you live in to set up your own LLC. You can also pay an attorney or accountant to help you do this. I recommend talking to an accountant to see what the best option is for your business. 

I made the mistake early on of assuming I needed to choose the s-corp election to save money on taxes. However, this isn't always the best option. Talk with a tax professional to explore your best options and the financial impact.

Did you hire an attorney?

I did not hire an attorney when establishing Worth Winning. I used XYPN templates for the various documents necessary to get going. It was sufficient starting out. I would recommend having an attorney look over your documentation as your business matures. Your financial planning agreements will evolve and need to become more custom than what XYPN provides as you grow. 

Who does your marketing?

This is a team effort at Worth Winning. I hired help for social media and content creation, including blog posts, newsletters and emails, podcast show notes, and graphic design. 

If you're doing your marketing on your own, I recommend you try to get on podcasts and find speaking engagements. Initially, I did a lot of these for free. Focus on getting in front of audiences and providing value. This helps you become a credible source of financial information. 

What is something you did from the beginning you would recommend others do from the start?

I went to a lot of conferences from the start. I focused on networking with people. And I signed up to do a lot of speaking engagements and media spots. I was on every podcast I could be on and signed up for Help a Reporter Out, which I highly recommend. I also joined media outlets for organizations like FPA and XYPN.

What's something you did in the beginning that you wouldn't do again?

I paid to play. For me, it was an NFL event where I paid to get access to NFL players. However, there were a set of rules about how to interact with them, and it was incredibly limiting. There were competing speakers at the event, and they weren't following the established rules. I realized I'm not a rule breaker, and it wasn't a productive environment for me to be in. It was also a very male-dominated area.

There are a lot of ways to network with people without paying for it, or at least without paying significant amounts of money. If you consistently use social media, it can be easier to reap the benefits of your time instead of investing your dollars as a new business owner.

What programs or software do you use with clients?

I use Right Capital for my financial planning software. I was previously with eMoney Advisor but couldn't justify continuing from a cost standpoint of working with young professionals. Everything my clients need is in Right Capital. And while I won't say that it's superior to eMoney Advisor, it's simpler and provides the information that is necessary for the clients I work with. 

Each of my clients also has a Trello board that we use for task management. I do my best to keep my clients out of email because it's too easy for things to get buried. 

What programs or software do you use for the internal side of your business?

  • Trello - This is meant to be a task management software, but we also use it as a CRM
  • ​Zapier - This is a must-have for automating your processes. It's a game-changer and I wish I would have used it sooner.
  • ​Airtable - This makes pretty spreadsheets. We use it for everything from social media planning to tracking forms and survey responses.
  • ​Google Suite - This is sufficient and affordable for small business owners. 

What type of people should I have in my network? What networking groups are worth the time?

You should be networking with the type of people that you want to serve. If you're focused on student loans, then you'd want to be at events with college professors, educators, people in professions who tend to carry high student loan debt. You want to find access to people who fit your niche. 

Also, if you want to focus on a particular group, find the events relevant to them. If you want to focus on women, where are they hanging out? For example, I volunteer at the Junior League. I'm not doing it specifically to get clients, but that's where my target market hangs out. While I'm there, I don't focus on pitching my services to people. I try to provide as much value as I can to them. The delayed return on my investment is I build relationships with people who know me, like me, and trust me enough to let me help with their finances. 

Other good networking groups can be accountants and estate planning attorneys. These can be a great place to start because they never have a shortage of clients. Knowing how you're different from others in the industry and being able to communicate how that difference can help you serve their clients better is key. 

What should I know before starting my own financial planning business?

There's a popular saying that entrepreneurs are those people who are willing to work 80 hours for themselves so they don't have to work 40 hours for someone else. I find this to be very true.

While we all have goals and aspirations of becoming successful immediately, that's not generally how it works. You'll have to be able to sustain yourself for a period of time before you're able to pay yourself. I found 3-5 years is a reasonable benchmark, so make sure as a financial advisor that you have your own finances organized. Create a timeline to allow for growth, and remember you don't plant a seed then see results overnight. 

How do you choose what clients to work with?

When first starting out, it's easy to want to work with anyone who will pay you. I had to evolve over time to a place where I understood the importance of not doing this. You want to take a client because they're a good fit, and you believe you can help them. I now choose to work with the people I truly believe I can help make a meaningful difference in their financial lives. In addition, I carefully look at which service offering is a best fit for them. I've learned to get a feel for their personality and whether or not I think they will implement the changes I recommend. 

Along with this, I learned to stop letting clients suggest the service they wanted if I knew it was not appropriate for them. 

Additional Resources

You can learn more about my story in these episodes of the Worth Listening podcast:

If you still have questions about becoming a financial planner or starting your own financial planning firm, feel free to book a paid call with me to chat. You can choose a 15-minute, 30-minute, or 45-minute call to pick my brain at a time that works for you. PLEASE NOTE: My calendar may be booked out 1-2 months in advance, so reserve your spot now if you're interested. 

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