Author Topic: Mustachianism as a trade  (Read 5238 times)

Reepekg

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Mustachianism as a trade
« on: January 05, 2014, 10:51:17 PM »
I enjoy managing my own money. I like looking at my balances, tracking spreadsheets, and all the rest. So I'm wondering, have any of you like minded individuals turned financial advising into a side gig/income stream?

The problem is, my imagined business model seems pretty lame. It seems like anybody can be Mustachian on their own (and yet, they aren't!) Client walks in, I say hey and show them how to buy index funds among other things, and I ask for like $20. I imagine this is why actual financial professionals make things seem complicated and ask for a %.

My motivation is that I think I would genuinely enjoy helping people improve their finances, but has anyone successfully done this in a way that is MMM-compliant and still makes money?

Khan

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Re: Mustachianism as a trade
« Reply #1 on: January 05, 2014, 11:07:51 PM »
There are financial advisers that advocate the use of DFA funds(essentially a super-vanguard fund using some more intelligent trading schemes and not entirely rules bound to -exactly- matching the index). Those advisers are more ethical than otherwise, and basically their job is to prevent their clients from doing -stupid- things and to keep them "on course".

If you achieve FI, you could become a licensed CPA I guess and then essentially run it as a charity, helping lower income folks straighten out their finances, avoid predatory lending/rescue themselves from it, and place them on the straight and narrow.

frugaldrummer

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Re: Mustachianism as a trade
« Reply #2 on: January 05, 2014, 11:28:53 PM »
Sounds like you want to be a fee-only financial planner?  With a specialty in getting people to budget?  ;)

I went to a fee-only planner for a consultation when I was getting divorced.  She was a woman who specializes in women's financial education, and especially women going through divorce - has a website, gives seminars etc.

I wanted to have some idea of what my financial situation would be like after the divorce, and some sense of where to focus my finances and negotiating strategy int he divorce.

I only saw her once - I didn't feel I needed her ongoing advice at that time.  It was $450 for that initial (lengthy) consultation. 

arebelspy

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Re: Mustachianism as a trade
« Reply #3 on: January 06, 2014, 07:27:03 AM »
Here's a few previous discussions of this idea, a search may turn up more:
https://forum.mrmoneymustache.com/ask-a-mustachian/is-it-anti-mustachian-to-become-a-financial-planner/
https://forum.mrmoneymustache.com/ask-a-mustachian/business-idea-mustachian-financial-planner/

Watch out for the fiscal responsibility/liability you may have with something like this.

I think being a debt counselor or teacher of a personal finance class aligns with your interests and is much more ethical than being a financial planner.  Those two options may be a good side gig/FIRE job that one might enjoy.
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puglogic

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Re: Mustachianism as a trade
« Reply #4 on: January 06, 2014, 08:01:21 AM »
What about not just financial planning, but a sort of Mustachianism Ninja?  Just yesterday my husband and I sat down and tried for the tenth time to figure out how to stop bleeding money on landline/internet/cable (and in our case there doesn't seem to be a way around having all three if I'm to stay married...).  We have the excellent threads from this forum to refer to, but when we try to make it work with our individual needs and preferences, it just gets bogged down in hours of figuring-out:  Does this service offer THAT?  Can we keep this number?  Is that provider even in our area? etc etc

If there were someone locally who could listen to our needs and then just make all the right comparisons and choices for us, it would be a one-time service we'd happily pay for, just as I'm sure there are plenty of people who would like to have someone corral a lot of where-to-buy-it-locally data or other money saving tools tailored to a specific area.  Just a note to anyone pondering that sort of business!  :)

Reepekg

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Re: Mustachianism as a trade
« Reply #5 on: January 06, 2014, 11:01:34 AM »
Watch out for the fiscal responsibility/liability you may have with something like this.
Yeah, exactly :-/

I think being a ... teacher of a personal finance class aligns with your interests and is much more ethical than being a financial planner.
Optimize the number of people you reach? Nailed it.

the fixer

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Re: Mustachianism as a trade
« Reply #6 on: January 06, 2014, 12:41:14 PM »
Here's my experience from investigating this:

First, the laws. You generally cannot make money offering financial advice without meeting various state-specific requirements. I think this usually involves passing some tests like the Series 65, which covers lots of investing topics to show you know what you're doing. A small wrinkle in the process is that the Series 65 covers lots of aspects of daytrading that a Mustachian has no need to know, like options and futures trading. There's no reason you can't learn all of this, though. When I added up everything I computed a total startup cost of about $200-300 plus a month or so of studying.

The next problem has been much more vexing. When I try to help people I know with their investments I run into this frequently. People are already getting help from a "financial advisor" who is really only a broker making commissions off their recommendations. These people continue to use this broker, though, because they are making emotional decisions about their money and "trust" this person who "takes time to listens to them." I'm trying to be a teacher, but my "clients" are looking for a salesperson to give them a hot fund and stop asking lots of tough questions like how high their expenses are. So if you want to be successful in this field, it's not about how much you know about investing. It's about soft skills and sales tactics.

Take a look at this to get a glimpse of your competition, and how even government financial investigators can get fooled. http://www.cbsnews.com/news/retail-financial-advisors-looking-out-for-themselves/

I'm starting to come around to the idea that trying to be a Mustachian financial advisor is a lot like trying to be a social worker helping the homeless. If you have the patience, empathy, and ability to disconnect that the latter field requires to try helping people who have no interest in helping themselves, you could be successful.

meadow lark

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Re: Mustachianism as a trade
« Reply #7 on: January 06, 2014, 03:16:11 PM »
I think this could be fun.  Run a Continuing Ed course through the local university.  Okay, gonna move this to my journal, so I don't forget it.

scrubbyfish

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Re: Mustachianism as a trade
« Reply #8 on: January 06, 2014, 05:03:45 PM »
What about not just financial planning, but a sort of Mustachianism Ninja?  Just yesterday my husband and I sat down and tried for the tenth time to figure out how to stop bleeding money on landline/internet/cable (and in our case there doesn't seem to be a way around having all three if I'm to stay married...).  We have the excellent threads from this forum to refer to, but when we try to make it work with our individual needs and preferences, it just gets bogged down in hours of figuring-out:  Does this service offer THAT?  Can we keep this number?  Is that provider even in our area? etc etc

If there were someone locally who could listen to our needs and then just make all the right comparisons and choices for us, it would be a one-time service we'd happily pay for...

Yes, please!!!

It's stupid how much time I have to spend figuring this stuff out. My math is crappy, I get confused easily, and I find phone conversations exhausting. I spent several hours "optimizing" today and got how far? I'd rather have paid someone to do the optimizing -and successfully, to boot- and taken my son swimming like he wanted :(

the fixer

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Re: Mustachianism as a trade
« Reply #9 on: January 06, 2014, 06:35:23 PM »
The trouble is that a lot of this comes down to individual preferences. A truly badass Mustachian would be like some Buddhist monk and just tell you get rid of XYZ and get over it. What you would need is someone who shares your perspective on the necessity of something or else they wouldn't bother researching it.

NinetyFour

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Re: Mustachianism as a trade
« Reply #10 on: January 06, 2014, 06:37:43 PM »
This would be a cool job.  You'd deliver face punches and get paid for it.  Nice.