By Nick Hunter
There are many people who feel that to make money in todaysmarket and in the future, you must work off of advisory fees andnot commissions.
An Investment or Financial Adviser is someone who manages aportfolio or advises a person what to do in their portfolio. Forthese services, an Adviser can retain a fee for doing so. Theyoperate much like an Accountant or an Attorney would. Ratherthan directly sell a security for commission, they will receivea fixed percentage of the assets they manage. The license thatmost of them receive is the SERIES 65 (Registered InvestmentAdvisor). What makes this arrangement attractive for the Adviseris that your income stream is much steadier. Your fees are setso if a customer is not particularly active, you still retainthe normal advisory fee you charge.
The arrangement is equally beneficial to the customer. Acustomer does not feel the same pressure to buy as they wouldfrom a commission Stockbroker. A Stockbroker does not make moneyunless a customer buys or sells.
The SERIES 65 does not need to be sponsored and can be practicedindependently. It also looks terrific on a resume and only takes4-6 weeks to study for. If you are looking to add financialcredentials prior to entering the securities business, theSeries 65 is a great license to get. It is a multiple choicetest and no educational pre-requisites are required.
A few states do not require an individual to hold a SERIES 65to practice investment advice but it is a good idea to get itanyway. You want to be aware of certain rules and background ofthe industry. The licensing curriculum will explain all of thesecurities that apply. It is also a good "Title" to practicebusiness under. Thousands and thousands of CPA's, Lawyers, andother professionals have obtained their SERIES 65 license andbecame Financial Advisors. The ability to offer investmentadvice to their existing clientele has proved to be verybeneficial to their business.
You are not allowed to work on commissions and advisory feesfrom the same client. The SEC views that as "double charging",so you should decide what route is best for you. As saidearlier, many feel the "fee route" is the best way to go now.
Good Luck!
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