Hello, I am considering starting up my own financial advisory business. What are the first steps I should take?
I saved up some money and want to help people specifically millennials manage their finances. Where is the first place for me to start? I have a few people who are on boat with me and I am in the process of creating a business plan.
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Apr 10, 2014
Chase.. what type of financial advisory firm?
To start an FA firm, you need licenses. And I'd recommend that you before a CFA.
To be a consultant who goes into firms to help them with their P/L, expenses, etc. that's a different story.
And then there is the type of consultant you may mean :)
Can you say more about what you're looking to do, so that I can provide more of an answer?
The first thing I recommend for anyone who is starting a business is to go to the library and get a book. It's called "starting a business in ___your state here___
Mar 6, 2014
Dear
You should have expertise, and Plan what products needed in Market , multi resources
Mar 6, 2014
Everyone has made great points on this. It is highly important to check out the regulations surrounding your industry first and obtain the proper certification if required. I worked for a firm that did debt management and it was a nightmare. It seemed every month they were losing their license in a different state and then getting it back in which it was a rollercoaster ride. I blame that on poor management structure and lack of substantial knowledge of those in charge. Needless to say I left that firm.
Reputation is EVERYTHING when it comes to financial businesses. A bad move or name can be greatly detrimental. Focus on the core needs and what you and your team needs to have to enter into this jungle. Good luck and let us know how it goes!
Mar 6, 2014
As consultants you should know these things already, if you do not know what you have to do under the financial services legislation, I do not think you should even begin
Do you have a degree in accountancy and/or law?
No one will look at you without a track record
I am sorry to be so blunt but to even have to ask these questions you are totally unprepared and deifinately not equipped to provide this service at all
Mar 5, 2014
First, make a decision of what financial products you will offer and which firms such as Scott Trade, Edward Jones etc. Next, whether you will be both Commision based or fee to client based if so you can join www.napfa.org
If you are selling Insurance as well as financial products then you can join www.naifa.org I recommend incorporating what type of firm or a mission statement in your business plan as well as which Consumer firms you will represent and definitely a Marketing plan within your Business Plan . Make Amendment to your Plan as need arise to adapt to any changing times.
Mar 5, 2014
1) do a market research
2) identify the market segment you wish to develop- pensioners/ middle class/ salaried/ entrepreneurs etc
3) Develop how will position your services- Marketing Mix.
4) Invest into Communication
Mar 5, 2014
I agree with Joseph on seeking legal advice. You can do it affordably by purchasing a legal service plan. Plans are available for business owners with 1-99 employees.
Mar 5, 2014
First of all I would get the proper designations for the financial industry so you will be perceived as an expert. (CFP). If you don't have any experience in the industry, I would suggest that you work for an existing Financial Planning Company to gain the knowledge before you go out on your own. Once you decide to go solo, then Tina Weber has given you excellent advice from a marketing standpoint. From the business side, your business plan will help you get organized. Good luck with your business launch.
Mar 5, 2014
you can be a broker dealer or a hedge fund we can help you become a hedge fund .
you can buy a broker dealer or you can create a new one
Mar 5, 2014
Know your market like the back of your hand!!!!! Then hire an expert, like me, to help you get launched.
Mar 5, 2014
It's both quite easy and difficult. You need to open doors. Network like crazy and get some clients. Develop case histories or what are called success stories and create a group of references,.
Mar 5, 2014
There are many selling financial services so you need to be able to demonstrate why your advice is better, faster or cheaper than all the others. The business plan is essential along with an initial break-even analysis for your first year in business. Good luck and let me know if I can be helpful to you in any other way.
Mar 5, 2014
When you have your business plan ready and people on board I would visit your lawyer. Yes, it costs a lot but in the long run it will save you a lot of money and hassle. They can go through getting all the right paper work and big hurdles. A lot of businesses try to skimp on the legal stuff and it bites them in the butt. If your serious about this and want to grow your business you need to be set up correctly and legally protected. After that, sell sell sell...Build you name as the go to millennial financial adviser. it will be difficult because they tend to have a lot of debt and little income so you'll have to set it up differently. Good Luck.
Mar 4, 2014
Hi Chase,
Are you already a financial advisor? Do you already have all the licenses required to hang your shingles as a financial advisor? I am assuming that you are already a CFP, you are already familiar with the licensing requirements to be an independent financial advisor, and therefore already know that if you manage a portfolio with assets totaling less than $100 million, you'll need to register with your state securities agency; but if your portfolio is over $100 million, you'll need to register with the U.S. Securities and Exchange Commission.
It sounds like you have an inkling to which market you'd like to target, but one of the first things I'd like to recommend is researching your competitors and validating that market. If you are building your business plan, I'm sure you are already doing some of this.
Get to know your competitors well so you can figure out how to differentiate yourself while staying price-competitive. What's your USP (Unique Selling proposition)? What do you want to be known as? (experts in a specific financial advisory product? expert in millenials?)
Once you have figured out your unique selling proposition, where you want to be located and how you want to project your business image, here are a few thoughts (based only on the information you gave, so they are kind of general)
This business is about trust. You should think of ways to get yourself known in the market you want and build trust.
1. Do you have a website with a blog? You can start one easily and cheaply. Start posting about financial issues millennial often face. Make sure visitors to your blog can sign up for your newsletter/email list.
2. Always carry your business card and go to places/networking events where your target market hang out.
3. Make sure your LinkedIn page is not only up to date, but also have a powerful summary that reflects all the advantages of what you have to offer.
4. Make a plan to reach out to everyone you know to tell them about your new business and make a goal of contacting a certain number of people each day (50? 100?) Make sure you have a good (CRM) system to keep track of who you have contacted, and when, whether you need to follow up with them or just a quarterly touch base. Maybe you can try Zoho or even a simple spreadsheet.
5. Offer to share your expertise by teaching classes (check your local community colleges, or community education organizations) or speaking at events. Get creative and make your class/talk sound exciting.
Good luck!