Author Topic: Advice for Increasing Salary - Financial Industry  (Read 1680 times)

lovesasa

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Advice for Increasing Salary - Financial Industry
« on: April 01, 2018, 05:31:32 PM »
Hello! Looking for advice on increasing my salary via continuing education/switching jobs in my field. I am a 28/yo female.

I currently work for a 401k Administrator making $22/hr ($45,760/yr) + ~$2,500 annual bonus, 4% 401k match, $400+/month towards health insurance, and a profit sharing program that I'm not yet vested in (20% after 2 years). I have been at this company for 1 year.

I am also working ~15 hour a week at $19/hr teaching ESL online as my "side hustle."

I'm doing well, but I'm struggling with my current work hours. I am constantly sleep deprived and stressed out. My apartment is a mess. And now I have developed neck/back problems from working at a computer 11 hours a day (M-F) and not exercising. I haven't had time to cook, which I both enjoy and lowers my food costs.

I am saving decently well, but could do better:
-15% to 401k
-$5,500 to traditional IRA (was doing Roth, but switched to Traditional this year to help lower my tax bracket due to my 1099 income)
-Max to HSA savings account
-Max to SEP IRA (~25% of NET income from my side gig, about $2000 from last year as I started working in April).
-Emergency Fund (~$8K) +$400/month (will be redirecting this towards down payment and car funds once my EF is $10K)
-$100/mo towards a taxable investment fund with WiseBanyan (I view this as my backup emergency fund, only to be touched in case of long-ish term job loss) It has a balance of around $15,000, as this was previously where all of my savings went when I was ineligible for tax-advantaged accounts due to working abroad.
-$30K in an inherited annuity earning 5%. I have to take out a bit each year over the next 4 years until it is all withdrawn. Viewing this as my start on my down payment fund.
-No debt, paid off student loans. I put all of my spending that I can on rewards credit cards, but I pay those off in full every month via auto-pay.

All said I'm probably saving ~33% of my gross income currently, mostly towards long term goals/fire. I would like to increase my savings towards short term goals of a car (my current one is 14 years old and 111K miles) and a down payment on an investment property without significantly decreasing my FIRE savings.

As soon as my lease is up in June on my $1250 + $150/utilities single bedroom apartment, I am moving further from work but lowering my housing expenses to about $500/mo + utilities.

Now that my housing costs will be decreasing significantly, I want to cut back on my side gig hours and figure out a way to use some of this time to increase my salary. I have a B.A. in International Political Economy from a highly ranked Liberal Arts College. I taught AP Economics and IGCSE Business Studies for 2 years (in China). I have 1 year experience at my current position.

When I got my current job, I was really interested in going into Financial Advising, but all of the entry level positions I could find were basically glorified sales positions for life insurance, annuities or overpriced mutual funds. While I think I would truly enjoy fee-only financial advising, I have also read about Financial Management, and I think I would also feel comfortable in some sort of financial position within a company. I don't really mind my current position as a number cruncher/processor, but I can reasonably expect about a $1/hr/yr raise in perpetuity. Many of my coworkers don't have college degrees and I don't feel like my work ethic is really valued or getting me ahead. I would like to develop my skills so that I can get into a higher paying job and maintain some semblance of a work-life balance in the longer term.

Some options I am considering:
  • Online Excel Classes Free to $200 - This seems the logical first step. I use Excel everyday at work, and I think having some tangible skills to both make me more efficient and to add to my resume would be helpful no matter which route I take. I will probably start here no matter what.
  • CFP from the College of Financial Planning ~$5K --> This seems the most direct route to my 'ideal' job. However, even if I take the courses and pass the exam, I am still not technically a certified planner until I have 2 years of advisory experience. However, this may allow me to be able to get a foot in the door with some fee-only advisory firms.
  • Online Graduate Certificate in Applied Finance from Colorado State (CSU) ~$10K --> This teaches many of the concepts I would eventually need for the CFP, but also allows me to have an immediately applicable certificate. Additionally, all of the credits for this certificate are applicable to their MBA program if I go that route.
  • Online MBA from Colorado State (CSU) ~$40K --> With a focus in finance, this would allow me to go either the Financial Management route, or Financial Adviser route. It's expensive, though. :/
  • Accounting Courses? Free (only) to $900+ at the local community college to $$$ for a CPA - This is something else I have been considering. I have seen a lot of job listings for Controllers and Bookkeeping at local businesses. If I went this route I would likely work towards getting my CPA. I'm not as excited about this route, but two of my (former) coworkers went this route and have moved on to much more lucrative positions elsewhere.

While I have been considering these options anyway, I will add to this that I am in a very fortunate position. I was bouncing these ideas off my mom and she offered to pay for my graduate schooling. She is in a good position and well funded for her own retirement, or there is no way I would consider taking her up on this. That being said, I do not want to waste either my time or her money, so I am trying to continue to consider my options as if I were paying for them myself. I want the highest ROI, so to speak, on my career path.

What considerations would you include? Is anyone here in the financial industry? What career path did you take? What are you happy you did, what would you have done differently? What are the most time and cost-efficient ways that I can increase my value to a company and my earning potential?

Thank you all in advance!
« Last Edit: April 01, 2018, 06:48:29 PM by lovesasa »

chasesfish

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Re: Advice for Increasing Salary - Financial Industry
« Reply #1 on: April 01, 2018, 06:39:53 PM »
Why not go into the sales side of the 401k world, preferrably with a bank that's sending you warm referrals.  I run a sales team of bankers and referrals to our institutional group is part of the banker's goals.

You then would get paid proportionate to the revenue you produce.

There's three things that allow you to make a lot of money:
- A unique and marketable skill set (401k admin is pretty specialized, so check mark there!)
- The ability to sell
- The ability to lead and inspire people

I think you either need to get into leadership or sales if you want to stay in the finance world

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #2 on: April 01, 2018, 06:54:14 PM »
Why not go into the sales side of the 401k world, preferrably with a bank that's sending you warm referrals.  I run a sales team of bankers and referrals to our institutional group is part of the banker's goals.

You then would get paid proportionate to the revenue you produce.

There's three things that allow you to make a lot of money:
- A unique and marketable skill set (401k admin is pretty specialized, so check mark there!)
- The ability to sell
- The ability to lead and inspire people

I think you either need to get into leadership or sales if you want to stay in the finance world

I think the 401k industry is one niche that I would be comfortable in working in sales. I strongly believe in the product we are selling, and would love to be on the front line of helping companies to provide this benefit to their employees.

That being said, I currently work in the Operations side of our company. I am head of our loans processing department (the previous Loans head quit a few months into training me as her subordinante, so I was lucky enough to fall into a supervisory position fairly quickly), and I do also process payrolls and basic distribution requests. Where I'm struggling is that I don't see a clear line from where I am currently to a more lucrative position in sales or elsewhere in the company.

How would you suggest I build my skillset or duties at the company in order to move up either at my current employer or at a position such as you suggest at a different employer?

marty998

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Re: Advice for Increasing Salary - Financial Industry
« Reply #3 on: April 01, 2018, 07:04:08 PM »
I'm biased, but I'd strongly recommend the accounting route. It opens up so many doors - fund accounting, corporate accounting, management reporting, treasury, tax, consultancy... list goes on.

I have a B.A. in International Political Economy from a highly ranked Liberal Arts College.

Trying not to sass you for this but I'll bet you they did not teach Trumponomics in that course, which will be they way of the world for the foreseeable future.

Little Aussie Battler

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Re: Advice for Increasing Salary - Financial Industry
« Reply #4 on: April 01, 2018, 10:54:11 PM »
That is all true Marty, but there is a very big difference between an accountant and a salesperson.

I would recommend figuring out what you are interested in first. Could you arrange a secondment or trial period in the sales team?

chasesfish

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Re: Advice for Increasing Salary - Financial Industry
« Reply #5 on: April 03, 2018, 05:37:36 AM »
I'm in commercial lending, so I don't know the inner-workings to get from operations to sales.  I would think your skill set/visibility starts by taking on volunteer projects and leading training opportunities.  Your network and the impressions you leave on people are everything.

Do you have a sponsor?  Typically by sponsor I mean a boss or a boss's boss that takes interest in your work, your work rewards that person, and that person sees your talent and trusts you to take on any task.  My career was built on specifically picking the people to work for or follow.

How are job openings announced within your company?

Here is my story in Financial Services:  I made two significant internal leaps in my career. 

I started at $36,000 at 22.

The first leap was was three years in at age 25, I had a friend connect me with a leader who was hiring in another city.  I was willing to move and the friend/co-worker endorsed me to this leader.   I went to work for this person, soaked up all the skills he could teach, and in six years I went from $50,000 - $65,000 total comp range to $120,000 -$160,000 depending on how good the year was by the time I was 31.

The second round was when I was 29, a new EVP showed up over our region, a real up and comer that was one of the smartest, hardest working people I've ever seen.  I worked my rear end off for him, doing anything and everything that was asked and earned an interim promotion two years in to go turn-around a really crummy situation.  Less than a year into that crummy situation, I was asked to relocate again for a much bigger turnaround project, a couple months short of my 33rd birthday.   He's since moved on to executive management, but three + years into my current role and I earned $255,000 last year, will be around $265,000 this year, then would level out in the low $300s.

Accelerating my income has made it a lot easier to plan on retiring in early 2019 and financial services is a wonderful path. 

Interestingly there's an in-market promotion that I've passed on twice in the past month, I have personal things holding me back and I don't want to take on a new position and then bail, which would be wrong to people who've supported me in my career.  I also did all this inside a company that's struggling a little bit to "figure out who they are". We are stuck between two business models and its becoming a tougher place to work (which I really shouldn't whine about at this comp level - haha!)

Find the right person to work for and develop and cultivate your personal network - It'll pay off.

Ceredwyn

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Re: Advice for Increasing Salary - Financial Industry
« Reply #6 on: April 03, 2018, 09:07:42 PM »
Based on what you said, I'd go the CFP route. Find a fee only RIA if you really don't like the idea of "selling" funds/products/etc. There's a lot of demand for younger advisers right now, I would think you could find a junior financial planner role wherein you could get the work experience requirement concurrently with studying for the exam. Stay away from glorified insurance/annuity sales jobs masquerading as financial advising.

mozar

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Re: Advice for Increasing Salary - Financial Industry
« Reply #7 on: April 04, 2018, 10:10:05 AM »
I think if you are not excited about accounting you shouldn't do it. The whole field is being automated. There is still work for superstar CPAs but those people genuinly love accounting.  If my parent was paying I would take the mba route and go to a top 20 in person mba program which would be worth it for the networking.

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #8 on: April 15, 2018, 10:15:48 AM »
If my parent was paying I would take the mba route and go to a top 20 in person mba program which would be worth it for the networking.

Unfortunately, I didn't have my priorities straight in undergrad and only ended up with a 2.9 GPA. I was a good student most of the time so I have great references, but I highly doubt I would be able to get into a top 20 program.

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #9 on: April 15, 2018, 10:22:47 AM »
Do you have a sponsor?  Typically by sponsor I mean a boss or a boss's boss that takes interest in your work, your work rewards that person, and that person sees your talent and trusts you to take on any task.  My career was built on specifically picking the people to work for or follow.

How are job openings announced within your company?

Thank you for the insight into your personal path! My current company only has ~30 employees, so there are not many upper level openings that come up. All of the supervisors and department heads (there are about 4) have worked at the company for over 10 years.

Luckily, my boss and my direct supervisor both seem to be happy with my work and I have already received two raises, as well as additional responsibilities. I am currently being trained on higher level tasks, but I know that the two other people in this lower supervisor position make about the same as I do, so I don't know how much room for internal mobility there is.

Additionally, there are a lot of issues with company culture and we have pretty high employee turnover due to this. We have also lost about 1/4 of our clients over the last 1-2 years. I'm a little bit concerned about hitching my wagon too tightly to a company that doesn't seem to value management skills or customer service.

I am learning a lot at my current job that I think would be very applicable to either financial planning or accounting, as very few people outside the direct industry seem to understand much about the interior workings of 401k administration. I answer questions for our clients (HR and company heads) about 401k loan regulations on a daily basis, I already understand the regulations around payrolls and investment timing, and I'm currently being trained on distributions which includes the nitty gritty of all of the different types of 401k distributions (hardships, rollovers, in-service distributions, beneficiary distributions, etc.)

I would like to stick around long enough to really feel like I have a strong grasp on these things, but eventually I would like to move on to a company that is a better match for me in terms of business culture. Of course if a major leap up became available I would not turn up my nose at it, but I can't foresee that happening anytime soon, or even in the next 5 years.

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #10 on: April 15, 2018, 10:31:02 AM »
Quote
I would think you could find a junior financial planner role wherein you could get the work experience requirement concurrently with studying for the exam. Stay away from glorified insurance/annuity sales jobs masquerading as financial advising.

Thank you. This is exactly the sort of position I have been looking for and struggling to find.

Based on what you said, I'd go the CFP route. Find a fee only RIA if you really don't like the idea of "selling" funds/products/etc. There's a lot of demand for younger advisers right now.

Thanks. After a lot of thought, this is what I'm leaning towards. I do think I'm going to take the short 1-semester accounting course as a first step because:
(1) The information would be personally useful. My own taxes have gotten very complicated, and we also have a family owned partnership that my mom is one of the trustees for. No one in the partnership has any accounting or finance background, so it's been a rough few years trying to learn everything.
(2) The information would probably be helpful in my current job, as we do calculate tax withholding and that sort of thing for distributions.
(3) Most important, the CFP does require some knowledge of accounting and tax rules. This is one of the sections of the CFP coursework that I have the least background in and would be most challenging for me.

While completing the accounting course, I will do more research into all of the components of the CFP to see if there are any other sections I think I need more pre-requisite knowledge of. If so, I'll try to find online or one-off courses that cover this material prior to enrolling in the full CFP program.

This way, once I enroll, I can really focus on the difficult material and do as well as possible.

I intend to do all of this while still working, but my hope is that having these additional "feathers in my cap" will help me land a junior advisory position at a fee-only firm, rather than being forced to work as an annuity/insurance salesperson to gain my necessary 2 years experience for the full CFP certification.

chasesfish

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Re: Advice for Increasing Salary - Financial Industry
« Reply #11 on: April 15, 2018, 10:36:26 AM »
Have you looked into going on the accounting firm side of 401k audits? 

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #12 on: April 15, 2018, 11:46:10 AM »
Have you looked into going on the accounting firm side of 401k audits?

I have not! I'm not nearly as excited about that option, but I would definitely consider it. My boyfriend's boss's wife is a 401k auditor. I will ask her some questions the next time I see her.

teltic

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Re: Advice for Increasing Salary - Financial Industry
« Reply #13 on: April 15, 2018, 06:13:33 PM »
It overall sounds like you do not want to do accounting.  You simply don't sound excited about it.


I graduated with my BS in accounting, and decided I hated it (looking back, I think I didn't have a solid foundation of understanding it).  I jumped into a operations role at a operations analyst (doing quarterly reports, updating accounts, etc).  I loved the work.  I was making $40k, and after 2 years, I jumped to corporate finance making $58k. 

The company I switched to had tuition reimbursement, and paid $12k of my $30k masters in finance degree.  I wish I knew companies out there offer to pay education beforehand, I would have jumped over earlier to let the company pay the full $30k.  They do have a 2 year contingency for paying school, which ends summer 2019 for me.

I've thought about getting the CPA, simply to make more money (I lie to myself, saying I want to learn).  I'm not sure whether its worth getting it, for the sake of making more money.  I am pretty bad at taking tests, so it would take real work to get it. 

Focus on your passion.  Find out what you want to do first.   I haven't quite found my passion, but I keep looking.  Hopefully you find what you love dong! :)

lovesasa

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Re: Advice for Increasing Salary - Financial Industry
« Reply #14 on: April 16, 2018, 06:14:35 AM »
It overall sounds like you do not want to do accounting.  You simply don't sound excited about it.

This is pretty true, tbh...

Quote
The company I switched to had tuition reimbursement, and paid $12k of my $30k masters in finance degree.  I wish I knew companies out there offer to pay education beforehand, I would have jumped over earlier to let the company pay the full $30k.  They do have a 2 year contingency for paying school, which ends summer 2019 for me.

Unfortunately, my current company doesn't do any form of tuition reimbursement. On the other hand, I am learning a lot about 401(k)s at my current job, which I think will be useful in financial advising. I was kind of holding off on getting actual credentials for advising until I can find a job in the field that would pay for my certifications, but I'm starting to think I should go ahead and start working towards them just to have a chance of getting my foot in the door with a good firm.

Quote
I've thought about getting the CPA, simply to make more money (I lie to myself, saying I want to learn).  I'm not sure whether its worth getting it, for the sake of making more money.  I am pretty bad at taking tests, so it would take real work to get it.

Yeah this is kind of where I'm at. I think the accounting info would be very useful on a personal level, but I'm not exactly thrilled about it. However a CPA would be a fantastic feather in my cap. I'm also a fantastic test taker. I did extremely well on the SATs with very little prep, and I am pretty good at self-study for harder exams (when I set my mind to it). So I'm less concerned about being able to pass versus... is this really the best use of my time?

Quote
Focus on your passion.  Find out what you want to do first.

Thanks. I think this is what I've decided to focus on. I really feel passionate about financial advising. I think I'm just scared about jumping from a set salary to the potential unknowns in that sort of industry.

I think I need to do the hard research now into what exactly is required to pass all of the certification exams I would need to pass in order to advise in Colorado. At that point, if the CPA course still looks relevant, I'll take it, then follow up with other courses. If not... I will focus on the other classes that get me closer to my goal.