Career Planner: Wealth Management

By Nicki Mossavarrahmani, Staff Writer  and David Alexander, Owner/CEO

We all want success, to graduate from school with our options unhindered by obstacles, big or small.  And for those interested in pursuing a career in finance, the potential for that success can be mind-boggling.  We’ve all read stories of those big names, those market tycoons we all hope to follow, with their seven-figure plus salaries, generous stock options, private jets and exclusive parties.

These things and more are all possible to you.  But on this winding, yellow brick road of life, there are many forks in the road—choices that if made poorly, may pull you away from your ultimate goals.  To protect yourself, to ensure that the choices you make are the right ones for you and your dreams, we at the NFSA Arbitrage have developed the NFSA Career Planner.

In this second edition, we will outline what the financial industry is, but this time, the particular field we will be focusing on is: Wealth Management.  Over the next several pages, we will briefly explain the field of wealth management, some of the top jobs within it, the specific designations and education one would need to pursue a career in this field, the key skills and attributes need, salary ranges for each main job and the key duties/responsibilities one would expect to carry out in this field.

In all, it is our hope that by reviewing the information inside this NFSA Career Planner, planning out your financial career will become that much easier, helping you to make the right turns along life’s yellow brick road until you reach the point where the world will become yours for the taking … .

[NOTE: Following this edition of the Arbitrage, all further Career Planners will be released separately from the Arbitrage between each issue.  This is in line with the Arbitrage’s future growth strategy.]

What is Wealth Management?

[The following description of Wealth Management was sourced from WiseGeek.com]

“Wealth management is a financial service concept that emerged as a specific offering during the decade of the 1990’s. Generally, firms that offer a wealth management package provide a wide range of financial services to their clients that will include such basic elements as estate planning, asset management, and even private banking options. The use of a wealth management service can be helpful when an individual has amassed a large amount of assets and needs assistance in managing all of them effectively.

“In the best examples of wealth management, the client will be able to take advantage of a wide range of services that can include the management of everything from the mundane daily task of balancing the (chequebook) to long range planning for a trust or estate. One of the more popular aspects of a wealth management package is managing investments and managing the tax planning that is associated with the task. The financial service can also be helpful for people who are just beginning to amass a large number of assets, and would rather spend time dealing with other issues than managing finances.

“Because wealth management is a form of private banking services, persons wishing to enter the field usually prepare by obtaining educational credentials that are directly connected to financial disciplines. A wide range of professionals may be involved in the extension of wealth management services. Attorneys, certified public accountants, insurance professionals and brokers may all be involved in providing services to wealth management clients. In recent years, accredited courses and seminars on wealth management have become more common as the demand for this type of service has increased.

“The services included with a wealth management package will often include management of the investment portfolio, with brokers empowered to buy and sell on behalf of the client. Attorneys will help to structure family corporations, trusts, and other components that can make estate planning more complete. When it comes to taxes, a wealth management service will also prepare all reports and returns, offer advice to the client on tax elements involved with various aspects of the estate, and in general provide advice that is in the best interests of the client.”

Financial planner

*Field Description

Financial planners and wealth managers help individuals plan their financial futures. How are you going to cover your retirement needs? What do you have to do today to put your children through college? This work can be personally and financially rewarding and requires excellent interpersonal skills. A good financial planner understands investments, taxes, estate planning issues and knows how to listen. This work can be done within a company such as IDS Financial Services or by yourself, as a sole proprietorship.

*Common Job Titles

Administrative Assistant

EARNINGS               $25,000 to $35,000 a year

REQUIREMENTS

• University degree or college diploma

• Computer skills

RESPONSIBILITIES

Providing administrative support for senior advisors, including faxing, photocopying, and mailing.

 

Beginning Financial Planner

EARNINGS               $35,000 to $45,000 a year

REQUIREMENTS       • Experience in the field

RESPONSIBILITIES

Providing administrative support for senior advisors, including faxing, photocopying, and mailing; doing some preparation of financial plan reports.

Assistant Consultant

EARNINGS               $40,000 to $55,000 a year

REQUIREMENTS

• Skills and experience

• Completion of financial planning courses

RESPONSIBILITIES

Preparing complete financial plan reports from notes by senior financial consultants.

Financial Consultant / Planner

EARNINGS     $55,000 to $80,000 a year

REQUIREMENTS

• Ability to work independently with clients

• Certified Financial Planner (CFP) designation recommended

RESPONSIBILITIES

Taking on direct responsibility for clients; meeting with and advising clients; managing junior planners.

 

Vice-President

EARNINGS     $80,000 to $150,000 a year

REQUIREMENTS        Experience in team management

RESPONSIBILITIES

• Meeting with and advising clients; managing a team; expanding the business through sales contacts.

*General Accountabilities & Duties

   Assess clients’ financial needs for retirement, tax and estate planning.

   Formulate financial plans and solutions to fulfill client objectives.

   Implement financial plans that are monitored and reviewed regularly.

   Stay informed on current investment products and changes in the markets and tax laws.

   Provide comprehensive wealth management advice, including guidance on investment and portfolio management issues, to high net worth clients.

   Refer to, or consult with, tax, legal and estate planning specialists as needed.

   Prospect for new clients and build an established business.

*Key Skill Requirements

A good financial planner understands investments, taxes, estate planning issues and knows how to listen. In order to be effective, financial planners must be familiar with legal restrictions and laws concerning retirement plans, tax shelters, insurance, and trusts. They must be skilled at working with numbers and budgets and be able to understand complicated financial and legal documents. In addition, they should be articulate, persuasive, and have some decent selling ability. To make it in financial planning you need to know the details of various investments, tax law, estate planning strategies and you need to be good at marketing yourself and listening to your customers.
*Estimated Range Of Salaries

The median salary for financial planners job rankings issue was $70,000 in 2008. People that work for companies earn somewhat less and franchisees do the worst. The salary distribution in this business is highly skewed.

Bear in mind, of course, that it takes a number of years to build a strong clientele so that in the early days money will not flow quickly into a practice.

*Education, Certification & Licenses

If you’re thinking about becoming a financial planner, you should have at least a bachelors degree in a business related area. An MBA can be helpful but is not required at all.

To receive professional accreditation, they are expected to first complete financial planning courses such as those leading to CSI’s Financial Management Advisor Designation, which are the Canadian Securities Course (CSC), the Professional Financial Planning Course (PFPC) and the Wealth Management Techniques (WMT) course.

Financial planners are increasingly called on to have the CFP (Certified Financial Planner) designation. To become a CFP, you must past an exam approved by the CFP Board of Standards which covers over 175 topics in investing and financial planning. Today, there are approximately 59,000 CFP’s. The number has more than doubled in the last decade.

*Additional Information

U. S. News and World Report listed the position of financial planner as one of the twenty hottest professions for the future. They note that the entry of baby-boomers into middle age with a bewildering array of investment choices will make financially planning a really hot profession in the future. This said, financial planners interviewed recently point out that getting a solo practice going as a financial planner today can be difficult and highly competitive.

Mutual Funds sales representative

*Field Description

Mutual Fund Sales Representatives (MFSRs) are employed throughout the financial services industry by mutual fund dealers and independent financial planning firms. Personal Banking Representatives and many Insurance Sales Agents may also become licensed to sell mutual funds

As with Investment Advisors, Mutual Fund Sales Representatives are expected to build their own clientele and serve investors’ investment, retirement and estate planning needs. Unlike Investment Advisors, who are licensed to deal in stocks and bonds in addition to mutual funds, Mutual Fund Sales Representative are only licensed to advise on and sell mutual fund investment products

*Common Job Titles

Junior Analyst

EARNINGS     $50,000 to $100,000 a year

REQUIREMENTS       • Bachelor’s degree in commerce, economics, or a related field

RESPONSIBILITIES

Mathematical modeling; performing statistical analyses; note-taking; basic researching.

 

Senior Analyst

EARNINGS     $100,000 to $200,000 a year

REQUIREMENTS       • 3 to 6 years of experience

• Further commerce-related education, such as an MBA

• Possibly certified as a CFA (Chartered Financial Analyst)

RESPONSIBILITIES

More dealing with clients and company management; possibly specializing in a specific sector (for example, telecommunications).

 

Portfolio Manager

EARNINGS     $150,000 to $1,000,000 a year

REQUIREMENTS       • At least 5 years of experience as a senior analyst

• Proven track record of good investment picks

RESPONSIBILITIES

Much more responsible for selling the fund to potential investors; performing less analyses; directing analysts.

 

Chief Investment Officer

EARNINGS     $1,000,000 a year or more

REQUIREMENTS       • 10 or more years of experience

RESPONSIBILITIES

Directing all analysts and portfolio managers within department; motivating and evaluating staff; handling other management responsibilities; directing philosophy of investment strategy of company.

*General Accountabilities & Duties

# Build a book of business and open accounts for new clients.

# Analyze client needs and recommend mutual funds best suited to investment, retirement and estate planning goals.

# Receive and execute orders to buy or sell mutual fund units.

# Provide clients with account information and performance report

*Key Skill Requirements

*Estimated Range Of Salaries

New Mutual Fund Sales Representatives are usually paid a salary. Commission or fee-based compensation is usually phased-in after the first year. New representatives can earn between $30,000 and $50,000. More experienced representatives can earn $150,000 or more.

*Education, Certification & Licenses

To become registered as a Mutual Fund Sales Representative, a candidate must first fulfill proficiency requirements set out by industry regulators. One way is to complete CSI’s Investment Funds in Canada (IFC) Course or CSI’s Canadian Securities Course (CSC). A 90-day training program must also be completed.

*Field Description

Investment Advisors (IAs) work for investment dealers that trade in securities — the largest firms in Canada are owned by banks, but there are also a number of independent ones. This job puts you face-to-face with investors, so you must be registered with securities regulators to be able to provide investment advice and buy and sell investment products including stocks, bonds and mutual funds.

Investment advisors buy and sell many different types of investments (bonds, mutual funds, options, and term deposits) for their clients. They may be self-employed, or they may work in banks or other large financial institutions.

*Common Job Titles

Assistant to Investment Advisor

EARNINGS     $30,000 to $40,000 a year

REQUIREMENTS       • Canadian Securities Course (CSC)

• Familiarity with business computer software

RESPONSIBILITIES    Assisting advisors; doing research; maintaining computer databases; performing basic administrative duties.

 

Investment Advisor

EARNINGS     $35,000 to $100,000 or more a year, based entirely on commissions

REQUIREMENTS       • Bachelor’s degree

RESPONSIBILITIES    Buying and selling investment products for clients; helping clients structure and maintain an investment portfolio; staying on top of developments in the business world and financial markets.

 

Senior Investment Advisor / Partner

EARNINGS     $100,000 to $300,000 or more a year

REQUIREMENTS       • Over 10 years of experience as an investment advisor

RESPONSIBILITIES

Buying and selling investment products for clients; helping clients structure and maintain an investment portfolio; staying on top of developments in the business world and financial markets; performing management and administrative duties.

*General Accountabilities & Duties

# Monitor stock market and industry trends likely to affect clients’ investments.

# Meet with clients, by phone or in person, to discuss these trends.

# Advise clients on the products or services that suit their needs and objectives.

# Arrange purchase or sale of stocks, bonds and other investment products on behalf of investors.

# Prospect, build and retain a client base.

# Stay up-to-date on current investment products and markets

*Key Skill Requirements

*Estimated Range Of Salaries

Income varies greatly, depending on the number and type of clients advisors have, where they work, and the value of commissions they receive. Investment advisors may earn as little as $30,000 a year or upwards of $150,000.

The Canadian Securities Institute (CSI) reports that most investment advisors can earn at least $100,000 after 3 to 5 years. However, it is important to note that annual earnings are closely linked to the rise and fall of markets and the strength of the economy.

*Education, Certification & Licenses

Most IAs have earned a university or a college degree. Before they can become registered to provide investment advice to clients, IAs must meet proficiency requirements set out by securities regulators. These include completion of CSI’s Canadian Securities Course (CSC), the Conduct and Practices Handbook Course (CPH), plus the 90-day Investment Advisor Training Course (IAT). Within 30 months of approval for registration, IAs must also complete CSI’s Wealth Management Essentials Course (WME).

IAs must meet continuing education (CE) requirements throughout their careers to maintain registration. Many choose to complete CSI’s Derivatives Market Specialist Program or the Canadian Insurance Course (CIC), allowing them to apply for additional licensing to deal in options, futures or life insurance, and offer broader services to clients.

By Nicki Mossavarrahmani, Staff Writer  and David Alexander, Owner/CEO

In association with:

The ARB Team
Arbitrage Magazine
Business News with BITE

Liked this post? Why not buy the ARB team a beer? Just click an ad or donate below (thank you!)

Liked this article? Hated it? Comment below and share your opinions with other ARB readers!