guys, i’ve worked at UBS and MerrilLynch for a total of 3 years in 2 very different cities. i can honestly say that this was the nastiest job that anyone can do, and it’s the least value-added to the client. moreover, everyone that you work with are sleaze balls. regarding the nastiness of the job: when i lived in arizona, we had to show up to work at 6:30 am, and i’d be there until 8:00 pm. of course, i took a 2 hour lunch break, but i worked hard, and on every saturdays. i could never see the point in showing up at work when the stock markets were opened. it’s not like we did real-time trades for clients, etc. my salary was $36k back in '02. with commission, it was $42. more than 90% left within a year, and the goals were unattainable (i.e. bring in $7m in one year). churn was HIGH. also, minorities are at a serious disadvantage because clients simply don’t want to do business with a minority. i know so many horror stories here. we took a pathetically useless series 7 exam, which was damn easy and damn irrelevant. it should be a lot harder. clients don’t need to pay: 1.5% in mutual fund fees + 1.0% in advisor fees. this 2.5% is paid even during a bad market when they lose money. even warren buffet says that people are better off with an index fund. finally, i’ve seen advisors flipping elders from one annuity product to another, since the commission here is very high. also, financial advisors, in their telemarketing, purposely prospects other people’s clients/prospects from within their own company! also, every one of the senior advisors hustle the rookies to work for them for free or worse yet, as an indentured servant! both of these have happened to me. i’m very ashamed of my experiences at UBS and merrillLynch. this job should be heavily regulated or re-formulated. finally, these amway-salesman always approach people in public places trying to be your best friend. it’s tacky as hell.
That was a poorly-written post, but interesting nonetheless and reminds me of my own brief experience with financial advisors. Back when I was in college and trying to get some “financial experience” on my resume I “interned” at a Merrill Lynch retail office in the Midwest. “Interned” is in quotes because I basically spent one day there wandering around the office asking people questions. I spoke with the head sales manager who bragged about his clients and his income. He said “just between you and me, since I’ll never see you again, I make $250,000 a year managing $75 million in client assets.” At the time I thought it was all the money in the world and thought that kind of money was only reserved for the heavy hitters who’ve been in the business for decades. Of course now I would consider $250,000 to be a disappointing year for even a mid-level hedge fund analyst, but that’s also a function of me working on Wall Street instead of a legalized boiler room operation in the Midwest.
Does the job profile move towards actual advisement services eventually? Wouldn’t you basically act as an independent business after a few years?
What do you have against used car salesmen? They actually add value to our society, especially BMW pre-owned.
Excellent generalization boston.
There is a big difference between a 22 year old registered rep at a large shop and a 55 year old independent fee based advisor.
My brother was a used-cars salesman for many years. I think you should apologize for comparing my brother to some boiler-room ML financial anlayst.
boston_level2, I guess you couldn’t cut it. No worries man…I couldn’t either . Though you didn’t meet your expectations in sales at the wirehouse, you may succeed in other sales roles. Nothing wrong with being a salesman. When you’re higher up on the food chain at an Ibank, PE, or HF, you’ll work in some sort of sales capacity. Sales is a very broad function ranging from Creative outside sales (financial advisor) “Eat what you Hunt” to inside sales (bank brokerage advisor) “Eat what you’re fed”. Granted if you’re a natural, the former would be more lucrative, taking extraordinary talent. However, the latter where most of us belong can bring home well enough bacon. For me, I’m looking for a career where I can use my MBA/CFA charter and work to enhance the bank’s existing relationships to bring in new business.
sour grapes obviously. there are many financial advisors that know a lot more about managing money than 99% of MBAs I know. and there are many that are cheaper for high net worth individuals than say an investment councilor. the average ROI for the industry is around .4%. Hardly the 2.5% you mention.
those are still some crazy hours for only 42K…
I know someone at UBS at their FA program. He told me their salaries were in the 50’s to 60’s to start. What is the daily life of an FA like?
I worked for a total for 4 different firms in 3 years, hoping that the grass would be greener at the next place. It was never greener because each place was exactly the same. I did this right out of college. Now that I am 33, I look back and wonder how can any kid right out of college be giving financial advice and selling financial products. It’s all about transactions. Every placed I worked I was told “Don’t be an analyst.” The firms want their advisors to understand as little about the investments as possible. They just want sales. I actually sold cars for 2 months as well in between jobs. I would say that car sales is actually a more honorable postion. A good car salesman will know his products so basically the buyer knows what he is getting. The seasoned car salesman has a book of returning customers who trust him and these car salesmen make bank. From my experience, the seasoned financial advisor knows nothing about investments. He basically knows how to take advantage of customers’ ignorance when it comes to investments. I realize that’s a general statement, but having been in the business I can honestly say from experience that the vast majority of advisors, even the “Good” ones, do not have the client’s interest at heart. If they did, they would just recommend index funds to save the clients fees and expenses that just erode their capital.
if all clients should be in index funds jimmy than why pray tell are you getting your CFA charter?
Or maybe it’s that because he’s studied for the CFA charter, he’s realized that investors should be in index funds unless there’s an excellent reason not to?
If you don’t believe what you’re selling, you’re going to be horrible at it. Most financial advisors don’t, hence why they leave the business. It’s hard to have razor sharp focus during cold calls when your subconscious is chipping away at you.
there are many many financial advisors that do right by the client. it IS very hard to succeed if you are just out of college and don’t know a lot of rich people without completely ripping people off (or even if you are ripping people off), but that hardly has anything do to do with the majority of the industry. there are many financial advisors with CFA charters and many who have billions of dollars under management.
this really has nothing to do with getting charter. the program contains literature which speaks to this very point. asset allocation is a HUGE part of asset management, and I would argue a far more efficient and value added approach than try to pick stocks or high fee funds. unless you have a great of time and the luxury to specialize, trying to outperform stock indexes / etfs (on a risk adjusted basis) is very difficult, if not impossible, over the long run.
sure index funds work fine for those without any real net worth. but with ultra high net worth individuals (which are the people any successful FA must have) their circumstances are more complicated and many financial advisors can add significant value in that regard.
I did the bad internship at ML too. But who cares, I didn’t know any better. It’s a real tough business for the young guy at those shops. Now I’m at an independent advisor, 900 aum, and these advisors are brilliant.
oskigo Wrote: ------------------------------------------------------- > if all clients should be in index funds jimmy than > why pray tell are you getting your CFA charter? I never said that all clients should be in index funds… but clients that have their money exclusively managed by a brokerage firm would likely be much better off in an index fund, at least from my experience.