Financial Planner – Is It a Good “First Job” for Graduates?

According to Investopedia, Financial planners work with clients to help them manage their money and reach their long-term financial goals. As people live longer and earns more over their lifetime, the opportunities for a career in financial planning is exciting. In addition, financial planning is a career that is not difficult to join as you do not require years of specialised training to start so it’s a job that graduates from non-finance background can consider.

But for a fresh graduate, is this a good “first job” to consider?

Disadvantages of Starting Out as a Financial Planner

Let’s start with the bad. Specific to a fresh graduate, there are in my opinion 3 major disadvantages to making being a financial planner your first job.

They are:

1. Lack of a natural market

Generally speaking, your network are people who are similar to you and as a graduate, you may not have a natural market to build your clientele from. Your friends may not have found work or if they do, they have just started out and financial planning may not be at the top of their priorities before their finances stabilise.

2. Not Emotionally Ready

Afraid to lose friends, face and well, pride? It’s natural because as a graduate, you are not likely to have often been in positions where you are judged by people you know and care about (I’m not talking about dating). While you can intellectually accept that in the course of developing a clientele, you will hear some no’s and face some rejections, some from family and friends, it may not be something you can bear with when it becomes real.

As a young colleague of mine likes to say – it’s “emotional damage!”.

3. Not Enough Savings

Most financial planner jobs work on full commission-based remuneration. This means that there is no basic salary and until you achieve a certain size of clientele, no stable income. While this is not a problem for people with savings, this can be a real challenge for a graduate who do not have savings.

Yes, as bad as it sounds and the challenges are real, it’s not exactly mission impossible. Being a fresh graduate may bring with it a lot of advantages as well as these are the real advantages when you are considering the “path less travelled”.

Advantages of Starting Out as a Financial Planner

1. No “hard” commitments

It’s a “seasons of life” thing. You are not likely to have to worry about mortgage loans, children’s school fees or parent’s medical bills when you are a fresh graduate and this perhaps, is your biggest advantage and opportunity. Freedom is not something that we can easily put a price on but it is certainly priceless to those who don’t have it. And when you have it, make the most use of it!

2. Learns Fast

It’s not about your individual learning ability or attitude but about something very real – you have nothing to unlearn. It is likely that financial planning is a whole new topic to what you are familiar with and accustomed to which means that (almost) everything is new. Furthermore, you are still likely to be in the “student mode” so the learning gear can be something you can engage quickly and you are able to absorb what you are taught like the “world’s best sponge”!

3. Low maintenance

You don’t need to earn a high income because you are unlikely to have or need a high expenses lifestyle. So, if you are reasonably hardworking and capable, you may be able earn enough to cover your expenses within a year and thereafter, every year is savings. This to me, is the biggest advantage to a fresh graduate starting a commission-based job or any venture that does not have a fixed salary (e.g. starting your own business) – you can “afford” to start on the low base.

While there are obvious advantages and disadvantages to you choosing financial planning as a “first job”, I would like to respectfully suggest that these are not the reasons, as logical as they may be, in deciding if financial planning is a good first step in your resume.

Is Financial Planning a good first job?

Disclaimer first – I am responsible for recruiting financial planners so I will be biased – but not for the reasons that you are thinking of. I don’t believe that every graduate should “try financial planning because this can be the best career ever”. In fact, I think that most graduates should stick to what they have invested the past 3 or 4 years of their life studying for.

The reasons are obvious – you are already prepared in a certain field through studies and internship, you get the certainty of a basic salary with a well-defined career path and frankly, why go through the uncertainty of making a change like this?

Generally speaking, financial planning is not going to be the first choice for your first job unless you have a good reason to do so. And, over the years of helping and observing fresh graduates who have made financial planning their first job, and in some cases their long term career, here are 3 good reasons why financial planning may just be right for your first career step.

1. You did not want to do what you have studied for

It’s not anyone’s fault but it’s life. When you are young, you have to explore to learn about what comes natural to you, what you don’t do so well and what you are actually passionate in. Sometimes, the exploring leads you to learn about what you really cannot imagine yourself doing and unfortunately, that answer sometimes is you do not want to do what you have studied for. A common example of why someone is willing to try financial planning as their first job is because after their internship, they realised that they wanted to do something that allows them to able to move around and talk to people rather than something that is task based and binds them to a desk.

2. You “love” Money and Planning

You might have a passion for money, not in the unhealthy and greedy type of way but in the “I can see that money is important and when people don’t plan properly, it can cause so much grief” type of way. Usually, this reason can come from personal experience such as seeing how your family or someone close has struggled with money issues and you understood that financial planning is not about selling or pushing products but rather, helping people help themselves in one of the most important areas of their life. This is really a passion-driven reason and is one of the best reasons why financial planning is a good first job, and in my opinion second only to the next reason.

3. You want to challenge yourself

Some years ago, I recruited a fresh graduate from actuarial science and the reason she gave about wanting to be a financial planner rather than working in the actuarial department in an insurance company is because she feels that she lacks the confidence to speak with people. And, the lack of confidence will impede her for the rest of her working life.

Being a financial planner is the challenge that she gave herself and if she can be successful, she will gain the personal breakthrough that will really help her grow as a person. She joined, worked very hard and is one of the most successful financial planners I know today.

Being willing to change to challenge yourself for the purpose of growth is to me, the best reason why financial planning can be a good first job for you.

Even If It’s To Try…Try For The Right Reasons

As a first job, financial planning can really provide the grounding needed to be successful in life, from acquiring practical knowledge such as financial planning and money management to learning essential skills such as sales, customer service, hard work, punctuality, independence, initiative, communication, teamwork and networking, you can really grow as a person even if financial planning did not eventually become your life-long career.

However, choose it for the right reasons and not the wrong ones (e.g. because you have nothing else that interests you or you are attracted by the exciting financial rewards promised…etc) and I hope that this article have been a good first step to help you explore.

Let me end with a gift in the form of some wise words from a mentor when I first started out…“In your first job, don’t worry about what you can earn, instead, worry about the person you become. The reason is because at the start of your journey, what you learn is more valuable than what you earn. The person you become in the long term will inevitably be more important than the financial rewards you receive in the short term.”

Good luck as you begin your adulting journey (the work part)!

Article by Lee Meng Choe
Email: mengchoe.lee@gen.com.sg

The writer is the Executive Director (Advisory) of GEN Financial Advisory