Final Paper: Financial Planning
I chose to research a career in financial planning. I an economics major and after I graduate I will most likely pursue a career working at a financial planning and investment company. Financial planners earn a living by helping people sort through and choose investments, insurance and other financial products. They do retirement planning, college funding, estate planning and general investment analysis.
Finding clients who need those services and building a customer base is crucial to experiencing success as a financial planner because referrals from satisfied clients are an important source of new business. Whether you find new clients by giving seminars or lectures, through social or business contacts or simply by cold calling, you must obtain a client base. Having a broad social network is one reason that many successful financial planners enter the field after working in a related occupation such as accountant, auditor, insurance sales agent, lawyer, or securities, commodities and financial services sales agent.
Financial planning employers look for candidates with a bachelor’s degree in accounting, finance, economics, business, mathematics or law. Courses in investments, taxes, estate planning and risk management are also helpful. Programs in financial planning are becoming more widely available in colleges and universities. Financial analysts may also seek the Certified Financial Planner (CFP), the Chartered Financial Analyst (CFA) or the Chartered Financial Consultant (ChFC). Generally, a license is not required to work as a personal financial advisor, but advisors who sell stocks, bonds, mutual funds or insurance may need licenses such as the Series 6, 7, or 63. These exams are administered by the National Association of Securities Dealers (NASD) and in order to take most of these exams, sponsorship by a member firm is required.
More than half of all financial advisors work for finance and insurance companies, including securities and commodity brokers, banks, insurance carriers and financial investment firms. However, four out of 10 personal financial advisors are self employed, operating small investment advisory firms, usually in urban areas.According to the Bureau of Labor Statistics, the overall employment of financial analysts and personal financial advisors is expected to increase faster than the average (by 27% or more) for all occupations through 2014. This is a result of the increased investment by businesses and individuals, the rising number of self-directed retirement plans and the growing number of seniors. Personal financial advisors will benefit even more than financial analysts as baby boomers save for retirement and as a better educated and wealthier population requires investment advice. In addition, people are living longer and must plan to finance more years of retirement. (Bureau of Labor Statistics)
Financial planners earn their income in several different ways. Some charge fees to each individual client. Some earn commissions on the investments they sell. Some receive a salary from their employer. And some earn a combination of fees, commissions, and salary. Those who earn mainly fees and commissions do well when the economy is booming and clients are investing money, but they may not earn much when the economy slows and clients are reluctant to invest. Financial planners who freelance can choose how they charge fees, but those who work for organizations that provide personal financial advising services, like banks or accounting firms, must follow the organizations' guidelines for charging fees.
In financial planning, women who chose the option of working independently and establishing their own personal base of clients do fairly well. My research showed that when it comes to financial advice, many women prefer getting it from women. A survey sponsored by Securian found that 23 percent of women would rather work with a female financial adviser than with a male planner, while 11 percent of women said the opposite.
Women also are more likely than men to have a financial adviser, according to the national telephone survey released in November. But finding a woman to give that advice has always been difficult. Of the 55,600 certified financial planners in the United States, fewer than one in four is female and countless more women work as financial advisers at banks, brokerage firms, insurance companies, and in their own businesses.
Salaries for financial planners (men and women) vary widely because there is a difference in pay between financial planners who work independently and those who work for a financial planning company. According to the Bureau of Labor Statistics:
· The middle 50 percent of personal financial advisors earned salaries in the $45-110,000 range in 2005.
· The median in Virginia was about $60,000 in 2005.
· In Blacksburg, the average salary of a financial planner is $43,000
Recent statistics show that women are earning less than men. For full-time, year-round workers, women are paid on average only about 77% of what men are paid; for women of color, the gap is even wider. These wage gaps stubbornly remain despite the passage of the Equal Pay Act more than 40 years ago, and a variety of legislation prohibiting employment discrimination. (NOW.org)
So for the salaries mentioned before, a women working as a financial adviser at a bank, brokerage firm or insurance company would earn between $34- $84,000 (33% less than their male counterparts). In Virginia, a woman would only earn $46,000 compared to the $60,000 a man would earn.
I did not find that women and men worked primarily in different subfields. However, there were certain subfields I found that most financial planners offered services in. The following data are the percentages of financial planners (both men and women) who offer the following services:
· Retirement planning --%96
· Portfolio review --%94
· Investment planning --%94
· Tax planning --%91
· Estate planning --%86
I am a man entering a male-dominated field. Only one in four financial planners is a women and I understand that it will be easier for me to begin a career as a financial planner as opposed to a woman. This shouldn’t be the case though. I am definitely concerned about achieving gender equality in the workplace because it is wrong for someone to earn less than I do simply based on gender. That is discrimination and is morally wrong.
Women are still not receiving equal pay for equal work, let alone equal pay for work of equal value. This disparity not only affects women's spending power; it penalizes their retirement security by creating gaps in social security and pensions.
I think there are fewer women in financial planning because we still live in a society where it is not the norm for women to handle money or invest in stocks and bonds. Those are primarily male areas and so young girls don’t even consider pursuing a career in that area. When was the last time you heard a young girl say “when I grow up I want to be a financial planner”. The common perception is that the kinds of work women tend to do in the labor force are clerical, retail, sales and other service-sector jobs and is considered an extension of women’s work at home.
Women do face discrimination. They are perceived as less valuable in the workplace, due to the presumption that they are more likely to be absent more often than men, take maternity leave, acquire less training and skills due to family responsibility and be less committed to their work and jobs. Then at the same time you have society who portrays women as passive, submissive and emotional. As the text says, “sex in terms of raw male and female, is already gendered by the culture within which these physiology facts of biology exist.” This implies that culture forms characteristics associated with male and female behavior and builds boundaries on how each sex has to behave.
There is no evidence to support that women just don’t want to be in financial planning. But there several organizations out there that are working and pushing hard for gender equality in the workforce. NOW.org is taking the following action by encouraging men and women to:
* Send a message to your legislators asking them to cosponsor the Paycheck Fairness Act.I chose to research a career in financial planning. I an economics major and after I graduate I will most likely pursue a career working at a financial planning and investment company. Financial planners earn a living by helping people sort through and choose investments, insurance and other financial products. They do retirement planning, college funding, estate planning and general investment analysis.
Finding clients who need those services and building a customer base is crucial to experiencing success as a financial planner because referrals from satisfied clients are an important source of new business. Whether you find new clients by giving seminars or lectures, through social or business contacts or simply by cold calling, you must obtain a client base. Having a broad social network is one reason that many successful financial planners enter the field after working in a related occupation such as accountant, auditor, insurance sales agent, lawyer, or securities, commodities and financial services sales agent.
Financial planning employers look for candidates with a bachelor’s degree in accounting, finance, economics, business, mathematics or law. Courses in investments, taxes, estate planning and risk management are also helpful. Programs in financial planning are becoming more widely available in colleges and universities. Financial analysts may also seek the Certified Financial Planner (CFP), the Chartered Financial Analyst (CFA) or the Chartered Financial Consultant (ChFC). Generally, a license is not required to work as a personal financial advisor, but advisors who sell stocks, bonds, mutual funds or insurance may need licenses such as the Series 6, 7, or 63. These exams are administered by the National Association of Securities Dealers (NASD) and in order to take most of these exams, sponsorship by a member firm is required.
More than half of all financial advisors work for finance and insurance companies, including securities and commodity brokers, banks, insurance carriers and financial investment firms. However, four out of 10 personal financial advisors are self employed, operating small investment advisory firms, usually in urban areas.According to the Bureau of Labor Statistics, the overall employment of financial analysts and personal financial advisors is expected to increase faster than the average (by 27% or more) for all occupations through 2014. This is a result of the increased investment by businesses and individuals, the rising number of self-directed retirement plans and the growing number of seniors. Personal financial advisors will benefit even more than financial analysts as baby boomers save for retirement and as a better educated and wealthier population requires investment advice. In addition, people are living longer and must plan to finance more years of retirement. (Bureau of Labor Statistics)
Financial planners earn their income in several different ways. Some charge fees to each individual client. Some earn commissions on the investments they sell. Some receive a salary from their employer. And some earn a combination of fees, commissions, and salary. Those who earn mainly fees and commissions do well when the economy is booming and clients are investing money, but they may not earn much when the economy slows and clients are reluctant to invest. Financial planners who freelance can choose how they charge fees, but those who work for organizations that provide personal financial advising services, like banks or accounting firms, must follow the organizations' guidelines for charging fees.
In financial planning, women who chose the option of working independently and establishing their own personal base of clients do fairly well. My research showed that when it comes to financial advice, many women prefer getting it from women. A survey sponsored by Securian found that 23 percent of women would rather work with a female financial adviser than with a male planner, while 11 percent of women said the opposite.
Women also are more likely than men to have a financial adviser, according to the national telephone survey released in November. But finding a woman to give that advice has always been difficult. Of the 55,600 certified financial planners in the United States, fewer than one in four is female and countless more women work as financial advisers at banks, brokerage firms, insurance companies, and in their own businesses.
Salaries for financial planners (men and women) vary widely because there is a difference in pay between financial planners who work independently and those who work for a financial planning company. According to the Bureau of Labor Statistics:
· The middle 50 percent of personal financial advisors earned salaries in the $45-110,000 range in 2005.
· The median in Virginia was about $60,000 in 2005.
· In Blacksburg, the average salary of a financial planner is $43,000
Recent statistics show that women are earning less than men. For full-time, year-round workers, women are paid on average only about 77% of what men are paid; for women of color, the gap is even wider. These wage gaps stubbornly remain despite the passage of the Equal Pay Act more than 40 years ago, and a variety of legislation prohibiting employment discrimination. (NOW.org)
So for the salaries mentioned before, a women working as a financial adviser at a bank, brokerage firm or insurance company would earn between $34- $84,000 (33% less than their male counterparts). In Virginia, a woman would only earn $46,000 compared to the $60,000 a man would earn.
I did not find that women and men worked primarily in different subfields. However, there were certain subfields I found that most financial planners offered services in. The following data are the percentages of financial planners (both men and women) who offer the following services:
· Retirement planning --%96
· Portfolio review --%94
· Investment planning --%94
· Tax planning --%91
· Estate planning --%86
I am a man entering a male-dominated field. Only one in four financial planners is a women and I understand that it will be easier for me to begin a career as a financial planner as opposed to a woman. This shouldn’t be the case though. I am definitely concerned about achieving gender equality in the workplace because it is wrong for someone to earn less than I do simply based on gender. That is discrimination and is morally wrong.
Women are still not receiving equal pay for equal work, let alone equal pay for work of equal value. This disparity not only affects women's spending power; it penalizes their retirement security by creating gaps in social security and pensions.
I think there are fewer women in financial planning because we still live in a society where it is not the norm for women to handle money or invest in stocks and bonds. Those are primarily male areas and so young girls don’t even consider pursuing a career in that area. When was the last time you heard a young girl say “when I grow up I want to be a financial planner”. The common perception is that the kinds of work women tend to do in the labor force are clerical, retail, sales and other service-sector jobs and is considered an extension of women’s work at home.
Women do face discrimination. They are perceived as less valuable in the workplace, due to the presumption that they are more likely to be absent more often than men, take maternity leave, acquire less training and skills due to family responsibility and be less committed to their work and jobs. Then at the same time you have society who portrays women as passive, submissive and emotional. As the text says, “sex in terms of raw male and female, is already gendered by the culture within which these physiology facts of biology exist.” This implies that culture forms characteristics associated with male and female behavior and builds boundaries on how each sex has to behave.
There is no evidence to support that women just don’t want to be in financial planning. But there several organizations out there that are working and pushing hard for gender equality in the workforce. NOW.org is taking the following action by encouraging men and women to:
* Wear red on Equal Pay Day, April 24, 2007.
*Host an "Un-happy hour" on April 24 to signal our dissatisfaction with the wage gap.
* Attend a local rally or plan one.
* Start a wage club.
Also there is affirmative action which rrefers to policies intended to promote access to education or employment aimed at minorities and women. Motivation for affirmative action policies is to redress the effects of past discrimination and to encourage public institutions such as universities, hospitals and police forces to be more representative of the population. This is commonly achieved through targeted recruitment programs, by preferential treatment given to such applicants and in some cases through the use of quotas. Affirmative action has helped considerably but has many people who oppose it and call it unfair. Hopefully we reach a point where actions such as affirmative action are no longer needed.
One day we will all be leaders working for a better world in the future. All of us – men and women – will be in a position to reflect critically on the barriers to women’s achievement and to gender equality in our chosen professions. I personally will keep an open mind and educate other men about equality in the workforce. Holding discussion meetings with other men about sexual harassment in the workplace, or other women’s’ rights is a good move to help make changes and although it would be hard to get a group together, it is worth a try. Hopefully I will be in a position where I can help change how things are and help achieve gender equality in the workplace.
Bibliography
* Start a wage club.
Also there is affirmative action which rrefers to policies intended to promote access to education or employment aimed at minorities and women. Motivation for affirmative action policies is to redress the effects of past discrimination and to encourage public institutions such as universities, hospitals and police forces to be more representative of the population. This is commonly achieved through targeted recruitment programs, by preferential treatment given to such applicants and in some cases through the use of quotas. Affirmative action has helped considerably but has many people who oppose it and call it unfair. Hopefully we reach a point where actions such as affirmative action are no longer needed.
One day we will all be leaders working for a better world in the future. All of us – men and women – will be in a position to reflect critically on the barriers to women’s achievement and to gender equality in our chosen professions. I personally will keep an open mind and educate other men about equality in the workforce. Holding discussion meetings with other men about sexual harassment in the workplace, or other women’s’ rights is a good move to help make changes and although it would be hard to get a group together, it is worth a try. Hopefully I will be in a position where I can help change how things are and help achieve gender equality in the workplace.
Bibliography
NOW.org
<http://www.now.org/issues/economic/factsheet.html#facts">
Career Prospects in Virginia. “Financial Planners”
<http://www3.ccps.virginia.edu/career_prospects/briefs/E-J/FinPlanners.shtml#earnings>
TIME.com
<http://www.time.com/time/printout/0,8816,1613829,00.html>
BusinessWeek.com
<http://www.businessweek.com/magazine/content/01_29/b3741711.htm>
Venturacountystar.com. “Female financial planners sought”
<http://www.venturacountystar.com/news/2007/aug/03/female-financial-planners-sought/>
Investopedia.com. “Is A Career In Financial Planning In Your Future?”
<http://www.investopedia.com/articles/financialcareers/06/financialplanningquiz.asp>
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