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How Much Money Could You Make as a Financial Advisor?

October 6, 2014 in Advice, Investing

Stock investing is awesome! You have a knack for it, you like it, you’re good at it and you know stock market basics – and then some. But could you ever make money as a financial advisor, and if so, how much? Like any profession, there is spectrum of income potential depending on how much you work, with whom you work and the kind of work you do.


Financial advisors can work with anyone from the very rich to average people.

About Financial Advisors

According to Investopedia, a financial advisor is defined as someone who “provides financial advice or guidance to customers for compensation. Financial advisors can provide many different services, such as investment management, income tax preparation and estate planning.” In order to become a financial advisor, you must pass the Uniform Investment Adviser Law Examination and carry a Series 65 license.

Can Advising People About Money Earn Me Money?

According to “High-earning Jobs to Help Pay Off Student Loans Faster,” the best financial advisors can rake in big bucks. The top 10 percent command salaries of more than $187,000 a year. The median income is more than $67,000, and you’re not likely to bottom out at less than $32,000.

What Are They Looking for in You?

So how do you get into that lucrative top 10 percent of big earners? One of the best ways to find out how to be a top financial advisor is to look at the advice the pros give to regular people seeking their services. Investment giant Kiplinger tells people seeking a financial advisor to pick someone with a definitive investment philosophy. If someone asked tomorrow about your philosophy, what would your answer be?

Most importantly, they give the very good advice of telling people to be thorough and do a deep background check. Before submitting to a background check, you should first give one to yourself. Know every detail of what’s in your professional and personal background. Even if you’re not attempting to hide an old skeleton, it will likely come raging back out of the closet upon inspection. Be ready to give an explanation.


The best financial advisors are well compensated for the valuable service they provide.

Great financial advisors are in short supply. They can work with everyone from the very rich to the average person working toward a comfortable retirement through stock investing. Success has to do with more than knowing the stock market basics. It is a business based on trust, honesty and rapport. People will trust you with their most intimate financial knowledge, and you must hold that trust sacred. Yes, you can make money, but that money must be made on the foundation of the financial success of the clients you help.

Andrew Lisa is a freelance financial writer. He covers stock investing and personal finance.

Should You Trust a Broker Who Earned an Online Degree?

October 2, 2014 in Advice, Investing

If you’re investing in stocks, you rely on the skill and integrity of your stockbroker as much as you rely on the same traits from your auto mechanic when your car breaks down. The world of stock investing is competitive and fast paced – and a lot is on the line. You need to know that your broker is the best trained, best educated and most experienced that you can afford.

But what if he or she got their degree through a distance-learning program? Can you trust a broker who earned their degree online?

The short answer is: yes.


Your broker can make you a lot of money, whether or not they earned their diploma online.

A Little Bit About Online Students

As discussed in “5 Things You Didn’t Know About Online Students,” distance learners aren’t exactly your typical college kid. In fact, they tend to be older, married, working adults with children. The vast majority (as many as 70 percent, although that number may be slipping a bit) are women. Sixty-six percent are over the age of 30, and fewer than five percent are of “normal” college age.

Distance Learning: The New Normal

According to statistics, nearly 20 percent of secondary-education students receive at least 80 percent of their education online. Once a marginalized niche that was frowned upon by academics, distance learning is now mainstream. The completion rates for online students are as high or higher than their traditional campus counterparts, and more and more tenured teachers cross over to teach online courses.

Investor Exams

For stockbrokers, the Series 7 is more important than any final exam was in college. Notoriously difficult and thorough, the Series 7 – like the Bar for lawyers – is the gatekeeper for those interested in making a living out of stock investing. The reason you can’t trade stock yourself is because, by law, you must be licensed to do so. Anyone who is licensed to be a stockbroker passed the Series 7. If they got over that hurdle, does it really matter how they earned their diploma?

Know Your Broker

No matter how they earned their diploma, your broker had to do homework – and so should you when it comes to you broker’s background. According to Forbes, only 15 percent of Americans checked out their broker before investing in stocks. Look up their licenses to make sure they’re registered, and check out their backgrounds and histories with state and federal regulators. Worrying about their college background should come second, if at all.


Online learning is now a regular, mainstream part of higher education.

The reality is, education is important. But in the high-speed, cutthroat world of stock investing, a broker’s real-world experience, connections, ambition, intelligence and tenacity can be more important than a degree. But if you put a high premium on college education, don’t discount distance learning. Keep in mind that Yale, Harvard, Cornell, Penn, Dartmouth and Columbia all offer online education. The degree is just as valid, the education just as sound and the money that you make from investing in stocks will be just as real.

Andrew Lisa is a freelance business writer. He covers stock investing and personal finance.

How to Keep Your Sensitive Info Safe While Investing

September 7, 2014 in Advice, Investing

In the digital age, investing in stocks almost always involves sending sensitive data over the Internet and, therefore, exposing it to the danger of accidental leaks or intentional breaches. When buying and selling on the stock market, you are – by the nature of investing itself – revealing the kind of data that is the most desirable to hackers, digital scammers and identity thieves, specifically financial and personal information. Keeping your data safe is always important. When it comes to the kind of data necessary for investing in stocks, however, an extra level of attention is required.


Protect yourself with security software and password protection.

Data Security: Nothing New in America

An article titled “Privacy has Been a Concern in the United States Since the Very Beginning” points out that concern over data security is nothing new. The Founding Fathers were so focused on security regarding personal data, in fact, that they guaranteed its protection by including the right to privacy into the Bill of Rights in the Fourth Amendment to the Constitution – although they referred to “data” as “papers and effects.”

Protect Yourself

First and foremost, use security software that not only protects against malware and spyware, but also installs a firewall on your computer. You don’t need to know much about computers to provide this layer of protection. Always secure your WiFi with a password that locks out unauthorized users. Don’t click random links, never provide information from requests via email and don’t respond to suspicious emails, even if they appear to come from your financial firm, bank or third-party money gateway such as PayPal.

You Can Only Do So Much

The reality of data security is that once you make sure things are secure on your end, you can only do so much regarding the security of your investment firm (which is far more likely to be targeted by hackers). A recent article points out that even major, stable, established retailers, sellers and financial firms – such as Fidelity National Services, eBay and Target – can be attacked and breached, putting the data of millions of customers at risk.

While this is unsettling, the reality is that large firms like this almost always take immediate steps to fix the problem and compensate victims. When investing in the stock market, use a brokerage firm (by law, all stocks must be bought and sold through a licensed stock broker) that is large, reputable and that has the resources to defend against breaches and deal with any issues that do arise.


The biggest investment firms work hard to keep your data safe.

Although media portrayals make it seem as if data theft from large firms is a constant threat, these institutions invest millions to hire the most qualified experts and invest in the best hardware and software available in the defense of your data. Use common sense and basic protections on your end, and invest with firms that are large enough to absorb the impact of a significant breach.

Andrew Lisa is a freelance business writer. He covers personal finance and stock investing.

Thinking of Investing for a Career? Follow These Tips

September 3, 2014 in Advice, Investing

So you have a knack for stock investing? Think your hobby could become a lucrative career? Well, the financial world has a lot of options for you. But be warned, it’s going to be competitive, fast-paced and stressful. Investing in stocks as a career, however, can also be rewarding, challenging and lucrative. But it will require a great deal of preparation in the realms of education and testing.


A career in stock investing can be lucrative and exciting.

Education

As discussed in “Majors That Employers Look for the Most,” several academic paths can serve as the springboard for your ascent into a career in investing. Business management studies can prepare you for a range of entry-level jobs that can lead to lucrative financial careers, including market research analyst. Finance degrees can lead graduates on career paths such as personal financial advisor and financial analyst.

Tests and Licenses

The financial sector is governed by strict laws and regulations. Certain jobs require specific licenses that can only come after tests have been passed. There are many exams for many different specialties. Like the Bar Exam for lawyers, you only need to pass these difficult exams once.

To become a general securities representative, you must pass the Series 7, which is required to buy and sell securities in the United States. The Series 3 is required in order to register with the National Futures Association, to trade commodities or to trade futures contracts. The Series 26 is required for those wishing to act as the principal for investment companies and annuities activities. The Series 6 enables you to conduct business in both investment company and variable contract products.

Internships

Internships are a great way to get real-world, hands-on practice in the fast-paced world of stock investing. Internships can be paid or unpaid, but either way, you’ll be paying your dues. These gigs can lead to dream jobs, and first jobs after internships almost always pay more than similar grads could make without having been an intern. Shoot for between 200 and 400 hours of combined service, and display your internship prominently when it comes time to search for a “real” job in the world of investing in stocks.


There are many paths for talented people who want a career in the world of finance.

Careers are made every day by ambitious, talented people who want to turn their love of stock investing into a career. Investing in stocks for yourself, however, is a whole different ball game than going pro for a big-time investment bank, brokerage house or financial firm. But if you study hard, get an internship and stay focused, you could be on you way to living your big-money dreams.

Andrew Lisa is a freelance financial writer. He covers the stock market and financial careers.

3 Tools Every Beginning Investor Needs

August 6, 2014 in Advice

There are a few things you’ll have to do if you’re a novice in the world of beginner stock trading. First, you have to learn to trade. Then you’ll have to sign up with a brokerage firm to legally execute those trades on your behalf. But you also need to make some real-world investments – investments in technology that you’ll need to keep up in the real world.


Laptops, desktops and tablets all come with pros and cons.

Computer

The reality is, you need a computer to invest. When deciding which class of machine to purchase, you have three basic options:

  • Desktops: Often written off as archaic machines relegated to the world of office cubicles and grandparents, desktops are not always the first choice for modern investors. But don’t write them off just yet. Desktops are generally faster than their mobile counterparts, they’re often more powerful, come with more storage and are almost always cheaper.
  • Laptops: Laptops are the workhorse of the business world. They obviously go where you go, but they’re limited by the capacity of their batteries.
  • Tablets: Tablets (not counting hybrids) don’t have traditional keyboards or the storage capacity of their bigger brothers, but they are fast, small, mobile, sleek and fun.
  • Hotspots

    A mobile hotspot is an absolute must for investors on the go. Once you learn to trade, you’ll realize that timing is everything. You have to be able to access your laptop or mobile device at any given time, no matter what – and you can’t rely on the connection wherever you may happen to be. A mobile hotspot turns your seat on the park bench into an Internet cafe. One of the best is the AT&T Unite Mobile 4G WiFi Hotspot.

    Software

    Your computer can’t do the work for you. But you’ll get a huge boost in power when you choose the right software. MetaStock Stock Market Analytical Software is a great place to start. You don’t have to spend a fortune on technology, but the pros are using software that follows trends, identifies opportunities and issues warnings for their investments. If you want to keep up with the big boys, you’re going to want to invest in software to give you an edge.


    A good computer means nothing without the right inviting software.

    Investing in the stock market requires an investment in technology. Beginner stock trading is not easy, but once you learn to trade, you’ll need the digital power to back up your new knowledge. A good computer, good software and a hotspot to make sure they never go to waste is a good place to start.

    Andrew Lisa is a freelance financial writer. He covers business technology and personal finance.

    Investors! Why it’s Important to Regularly Back Up Your Data

    July 30, 2014 in Advice

    When stock market players back up their data, they’re making an investment in protecting their investments. A sudden loss of data is a major and traumatic setback for anyone. But for investors, the threat is greater than the risk of losing precious photos, sensitive personal data or work. When investors fail to safeguard against data loss, they risk losing access to accounts that were verified on their computer, the precious research they’ve conducted, as well as their all-important records.


    Data loss can be especially catastrophic for investors.

    The Realities of Data Loss

    One of the first rules of the stock market basics is to protect your investments. This can be done through hedging against uncertainty in the market, diversifying your portfolio, insuring bonds or – in this case – by actually protecting your investments from the very real threat of data loss. Data loss can be the result of hardware failure (your hard drive crashes, you spill coffee on your computer, etc.), theft, fire, flood, a digital security breach or several other scenarios that happen too frequently for savvy investors to ignore.

    The Options

    As discussed in “5 Best Practices for Network Configuration Backups,” it is vital to back up each machine associated with any network. But the reality for many private investors is that a single machine may be the backbone of the operation. In this case, there are generally two options for protecting your data: physical backups to an external source or cloud storage.

    Physical Storage

    Although disks or CDs were the backup of choice until fairly recently for those involved in stock investing, most physical data backup will now involve an external hard drive. It could be a small thumb drive or flash drive, or a multi-terabyte standing unit, but physical storage means exactly that – duplicating your data onto a second (or third) physical, external device. Unless you store your drive at another location, this does not help you in the case of fire, flood or theft.

    The Cloud

    Remote hosting – commonly called “cloud storage” – involves transferring your data digitally to a third-party whose servers are somewhere else – hopefully somewhere very secure. The benefits of cloud storage are that a professional company maintains your data in a facility that is fireproof, temperature controlled and secured both digitally and physically better than you ever could. Also, unlike physical backup, cloud storage can be set to back up your machine – and all your stock investing data – automatically.


    External hard drives don’t protect against flood, fire or theft.

    The stock market basics dictate a strategy based on prudence. But no matter how careful you are, losing data is a reality that can’t be totally prevented. Stock investing requires research, repetition and strategy, all three of which are locked in your data. If something happened, could you recover? Don’t wait to find out.

    Andrew Lisa is a freelance business writer. He covers personal finance and business technology.

    What You Can Learn About Investing from Industry Geniuses

    July 14, 2014 in Advice, Investing

    Investing in your future is among the best things you can do to ensure a comfortable life during the uncertainty that lies ahead. The stock market is lined with pitfalls and traps – avoid them by studying the ones who navigated these minefields before you. Before you make your move, study the moves and philosophies of the geniuses.


    Before you analyze daily movements of the market, study the philosophies of geniuses.

    Peter Lynch: Focus on Earnings

    When asked by the CEO of Dell whether or not he believed the computer company’s stock would rise or fall in the next five years, former Fidelity fund manager Peter Lynch famously replied, “If your earnings are higher in five years, your stock will be higher.”

    Widely considered to be one of the most brilliant and successful investment gurus of his generation, Peter Lynch believes earnings trump every other aspect of the future of a company’s stock. Is the stock’s cost appropriately priced against the company’s earnings? According to Lynch, this is the only question that needs answering when playing the stock market.

    Jim Rogers: Accept Reality About America’s Future

    When investing in stocks, you’re investing in the future. In order to invest in the future, you have to be realistic. This financial guru believes it’s important to separate nationalism from your plays on the stock market. He believes the future wealth boom will be in Asia – China specifically. Also, he recommends betting on the agricultural firms that will literally feed the future boom.

    As discussed in “Meet the Dream Team: How a Company You’ve Never Heard of is Changing the Way You Invest,” money has no borders – and neither can your strategy when investing in stocks.

    Warren Buffet: Buy Low, Never Sell

    Warren Buffet is probably the best-known and most-studied investor in the world. A human ATM machine, Buffet built Berkshire Hathaway – a company whose stock goes for a paltry $105,000 a share. The company’s stock has risen more than 300,000 percent since 1964.

    Buffet believes in buying and holding – and virtually every credible adviser to those investing in stocks for the first time agrees that long-term investment is smart investment. Buffet has nearly all of his money tied up in a single company – and that company became legendary by picking undervalued stocks, buying them, holding on and never letting go.


    All the volumes ever written can’t compare to the knowledge gleaned from studying most successful gurus.

    Warren Buffet, Jim Rogers and Peter Lynch all have one thing in common: extraordinary success in the stock market. You will likely never duplicate their wealth – and you shouldn’t try to duplicate their exact strategies. But when forming your own technique and your own philosophy, it’s never a bad idea to stand on the shoulders of the geniuses who came before you.

    Andrew Lisa is a freelance business writer. He covers the stock market and personal finance.

    5 Laws for Selecting the Best Computer for Trading Purposes

    June 24, 2014 in Investing

    The stock market works in real time, and luckily so can you. An investment in a computer is an essential purchase for people who are serious about trading. Although your current computer will probably suffice for a while, there are specific things to look for when it’s time to upgrade. If it’s covered at all, the type of computer you need is glossed over in most of the books about investing for dummies.


    Every serious trader needs a good computer.

    Look for the following traits when buying a computer for trading:

  • Speed: When trading, seconds count. You simply cannot have a slow, sluggish machine dragging you down. Your computer’s speed is determined by its processor. The first processor, the Intel 4004, was 740 kHz and processed 92,000 instructions per second. Today’s multi-core GHz processors can handle 100 billion instructions per second. If nothing else, get a machine with a fast processor.
  • Power and Memory: Your computer needs enough muscle and memory to run several large, active software programs simultaneously. If it’s not strong enough and doesn’t have enough storage, your computer will struggle and crash (always seemingly at the wrong time). Hint: Although they’re obviously not as portable, desktops are almost always more powerful and come with more storage.
  • Multiple-monitor Capability: Many traders who play the stock market use multiple monitors. You probably don’t need more than one monitor starting out, but you’re going to want the chance to upgrade in the future.
  • A Few Good Options

    Consider the following suggestions when shopping for computers. As described in this article about tablets for trading, investors on the go have different requirements. But for the purposes of this article, only traditional computers will be profiled.

  • ASUS Black 17.3 G750JM-DS71 Laptop PC: Fast, powerful and fully portable, this monster’s hard drive comes with a full TB of memory. Its quad-core processor redefines speed.
  • iBuypowerBB675R: With a fourth-generation Intel Core i7 processor and a full TB of memory, this machine is robust enough for any trader – and it simply looks awesome.
  • The X500 Package from Orbital: This machine is designed specifically for traders. With four 21.5″ LED backlit monitors, this trading platform was designed to enhance your stock market experience without breaking the bank.

  • Laptops are obviously more portable, but they generally aren’t as powerful as desktops.

    Trading in the stock market requires a head for numbers, good timing, a well-thought strategy and a good computer. If you’re serious about trading, you don’t need a cliche book about investing for dummies; you need a machine that is powerful, fast, has plenty of storage and is customizable. A little luck never hurts when trading, but a great computer will go a long way to improving your prospects.

    Andrew Lisa is a freelance financial writer. He reviews trading technology and business machines.

    Business Lessons About Risk Management You Can Apply to Investing

    June 17, 2014 in Investing

    Stock investing is all about risk – and the mitigation of that risk through research, prudence and strategy. The business world is replete with cases of leaders doing a good job – or a not-so-good job – of managing risk. Many of those lessons, on both sides of the equation, can be applied to stock investment and avoiding the pitfalls encountered along the way.


    Risk management lessons in the corporate world can also be applied to the world of investing.

    Target: Vigilance is Key

    In “What Does the Ousting of Target’s CEO Teach Us about Risk Management?,” a few lessons come to light. When a data breach threatened the private information of one of the nation’s leading retailers, tens of millions of customers faced threats to their private information. With the ouster of the company’s CEO, one thing became certain: If it can happen to a corporate giant with cutting-edge technology and limitless resources, it can happen to you.

    When it comes to risk management, vigilance is key. No matter what the official reason was for the CEO’s ouster, the real reason he was fired was complacency.

    The Financial Collapse of 2008: If it Sounds Too Good…

    In the worst economic crises since the Great Depression, the lessons for investors came from mistakes made in the investment community. One of the biggest rules of both risk management and stock investing is that if it sounds too good to be true, it probably is.

    Investors ignored this rule as their portfolios and 401(k)s swelled from an artificial housing boom. Future victims of mass foreclosures ignored this rule as they signed mortgages for homes they should have never been able to afford. Both, it turns out, were duped by unscrupulous bankers who knowingly bought toxic mortgages, repackaged the debt and sold it as investments.

    The Bernie Madoff Fraud: Always Hedge Your Bets

    When convicted swindler Bernie Madoff saw the greatest Ponzi scheme in history come crashing down around him, countless investors lost it all after placing their trust – and fortunes – in a friend they’d known for years. They made a classic mistake of trusting a known entity – be it a blue-chip stock, a preferred mutual fund or an actual investor – so much that they put all their eggs in that one basket.

    Diversification is the key to stock investment. Hedging your bets is crucial in making sure that your fortunes aren’t hitched to one single ship, should that ship hit an iceberg. When it comes to risk, spreading it around is the key to success.


    When investing, hedge your bets, don’t fall for anything that promises too much and always stay vigilant.

    A risk management strategy is a lot like a field-goal kicker in football – you tend not to notice him until he messes up. Themes of risk management run concurrent through both the business world and the world of stock investing for one big reason: They both involve taking calculated chances to achieve a goal of growth. Watch what goes right in the business world, but also watch what goes wrong – and try not to make the same mistakes in your investment strategy.

    Andrew Lisa is a freelance financial writer. He covers stock investing and small-business management.

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