Jenna Hung also sings the praises of Cambridge. After two decades as a CPA and Peat Marwick auditor, Hung wanted to start her own financial advisory firm but didn't know how. "When I heard about Cambridge, I thought, 'This is similar to how I would structure a firm on my own.'" With Cambridge's help, Hung opened the doors to her practice in April 2006. "I've learned how to manage clients' expectations and to add value," she says. In only two short years, Hung now works with 28 full retainer clients plus another 20 "short-term" clients.
Says Whitehead, "I think people who come [into the profession] now, especially through Cambridge Alliance or another structured program, achieve in one year what took me at least three years. We had no options; we had to blaze our own trail." How long did it take Whitehead to earn a decent income? About six to eight years, he says.
But his goal for Cambridge members is different. "I believe that an advisor with five years of experience should get paid what other professionals with similar experience are getting, namely around $200,000-$250,000. And, if you're running a company, you should get more." What's his actual experience been with Cambridge members? "Our members might be new CFPs, breakaway brokers or attorneys/accountants, but on average they're earning $100,000 in three years, $150,000-$200,000 in five years and, from there, it plateaus unless they bring on more people."
Another well-known advisor network-if the advisor agrees with its implied niche-is the Garrett Planning Network (http://www.discovergarrettplanningnetwork.com) for fee-only advisors wanting to serve clients on a one-time or as-needed, hourly basis. Some Garrett members also do investment management or take non-hourly planning engagements, and some work with wealthy clients who don't want asset management, but the "one-time, as-needed" philosophy is still the basis of their planning mission.
If the Cambridge and Garrett networks remind you of the benefits advisors receive from affiliating with an independent broker-dealer, that's not surprising. All of us whose expertise lies in planning-not business management-need help; how we get it is just a matter of how much autonomy we demand along the way.
Professional Associations
Ken Weingarten transitioned into financial planning in late 2003 after a career in technology sales. "First, I attended local FPA meetings and NAPFA (www.napfa.org) study groups. I purchased Nancy Jones' book So You Want to be a Financial Planner? which helped me quickly decide on going fee-only. And going to NAPFA conferences, I met people like Bernie Kiely, who has served as a mentor to many."
In addition to getting help from NAPFA and the FPA, Weingarten attended the FPA Residency program in 2003 and met Rich Busillo of Philadelphia's RTD Advisors. "Rich has remained a mentor to me throughout the years, and my business model, compensation system and life-planning focus are very similar to his."
Weingarten, who says he also voraciously reads industry-related books and trade publications, is well into a six-figure planning income after four full years in business. "Do we do a lot of marketing? "Not really," he says, "but we built a Web site in 2004 and through the NAPFA online 'Find-a-Planner' system, we've obtained many clients, including some rather large ones." Weingarten also responds to NAPFA "Press Requests," receiving exposure that's brought in new business.
Veteran advisor Peg Downey of Money Plans remembers having several of NAPFA's early-'80s formational meetings (at which this author was present) in the living room of the house where she began her Silver Spring, Md., practice. "I couldn't have grown my business without NAPFA," Downey proclaims. She admits to having netted nothing her first year in business. "It was about three years before I had any real income, five years before I replaced the income I'd made prior to financial planning, and 10 years before the income I was earning truly compensated me for the work I was doing."
Fortunately, adds Downey, financial planning was a new industry that people discovered at a really good time. If the systems didn't exist to help planners grow quickly, at least the demand existed to help them stay in business until they could figure it out. Professional organizations provided some of the blueprints they needed, and today, the level of help they offer has grown to meet new advisors' needs.