In today’s stock market, it’s important for individual and corporate investors to have a reliable professional who will keep a careful lookout on their financial health. That’s precisely where the money manager comes in. Money managers are also called financial or investment advisors. They help clients create well-performing securities portfolios. Money managers play a prominent role in bridging the gap between clients and financial institutions to help meet realistic investing objectives. When red flags start popping up, money managers actively make trades and other adjustments on their clients’ behalf for the best possible growth. Using their due diligence and extensive financial background, money managers maximize the earning potential of individuals and businesses while maintaining a level of safety.
Salary
According to the Bureau of Labor Statistics, the 196,490 money managers advising clients on financial plans earn an average annual salary of $108,090. This equals a mean hourly wage of $51.97. Money managers who work for depository credit intermediation firms make significantly less at $82,660. Those employed by securities and commodities brokerages bring home the most at $119,320 annually.
Beginning Salary
When just starting out in the financial world, money managers can expect to land in the bottom tenth percentile of earnings with a beginning salary around $35,500. This may seem low. It’s important to remember that money managers with more experience and a proven track record for success draw in more clients for making upwards of $167,730 each year.
Key Responsibilities
Money managers have the primary responsibility of working with clients who wish to invest their money in the securities markets through:
- bonds
- stocks
- hedge funds
- mutual funds, and more
On a typical day, money managers may be found:
- monitoring a client’s assets
- making more profitable trades
- writing detailed reports on a client’s portfolio growth
- keeping clients informed about their securities
- staying on track toward client goals
- providing helpful investing advice based on individual needs
Money managers choose from the thousands of different investment types to give clients the most suitable portfolio. Keeping an eye analyzing the markets at all times is essential for money managers to increase their clients’ value.
Necessary Skills
Being successful in money management will require that you’re a skilled communicator with the interpersonal abilities to establish trust with clients and explain their investing options. Good mathematical skills are helpful for money managers to work with investment dollar signs and evaluate the amount of portfolio growth received. Money managers should possess analytical and critical thinking skills. They use these to make smooth investment decisions that minimize risk in current market trends. Having a certain level of sales skills is important for money managers to convince clients of their ability in keeping their securities secure. It will also help clients feel comfortable if you are:
- detail-oriented
- attentive
- caring
- organized
Degree and Education Requirements
As you might expect, working as a money manager requires a high level of financial expertise and knowledge of the complex investing world. Money managers must have at least a bachelor’s degree from an accredited business school. Most elect to earn their undergraduate major in finance, but suitable alternatives are:
- economics
- accounting
- business
- mathematics
It’s also helpful to take elective courses directly related to:
- money management
- wealth management
- risk management
- investments
- securities
- taxes
Many money managers also choose to return to graduate school. Having a Master of Science in Finance (MSF) or MBA in Finance helps improve chances of attracting more lucrative clients.
Pros and Cons of the Position
As with any other financial career, working as a money manager will come with its fair share of benefits and downsides that you must weigh.
On the positive side, money managers can choose to work for a firm or forge their own way with self-employment. Those who work independently can form their own schedule and attract their own clients. Money managers are able to use their passion for the stock market to help people with real investing problems. It can be extremely gratifying to assist clients in understanding their finances and making nice profits.
On the negative side, money managers deal with the stress of holding people’s money in their hands. Money managers can become bored with the number crunching after awhile and suffer from burnout. Money managers usually work normal 40-hour weeks, but some weekend and evening hours might be needed to accommodate clients.
Getting Started
It’s best for students to gain valuable resume experience while earning their undergraduate degree for a smooth transition into the financial world. Internships will provide a good supervised foundation for learning practical skills and financial fundamentals. You may have to start in entry-level jobs with pension funds or insurance policies, but all money-related experience will translate nicely to the field.
Since you’ll be managing clients’ investments, you’ll need to be registered with state regulators and/or the Securities and Exchange Commission (SEC) to buy or sell securities. Specific licensing requirements are available from the North American Securities Administrators Association (NASAA). If you have at least three years of relevant work experience, you’re then eligible for professional certifications to bolster your credentials and financial authority. You may want to consider becoming a:
- Certified Professional Daily Money Manager (PDMM)
- Certified Financial Planner (CFP)
- or Chartered Financial Analyst (CFA)
Future Outlook
Baby boomers are reaching retirement age, which means they’ll be flocking to the stock market for purchasing securities in hopes of returns on their investments. Since there’s also decreased funds for government pension plans, money managers will be in demand for giving clients better investing options for a long, happy retirement period. In comparison with many other financial careers, money managers should have among the best job prospects. In fact, the BLS reports that employment of money managers and other financial advisors is expected to skyrocket quickly by 27 percent, thus creating thousands of new jobs in the coming years.
Money managers will be able to find job openings in:
- financial investment firms
- credit intermediation companies
- securities and commodity brokerages
- insurance carriers
- government agencies
- private corporations
Overall, money managers are highly trained finance professionals who counsel clients on matters related to investment activities. Money managers have the hefty task of:
- providing effective portfolio growth strategies
- monitoring the performance of investment portfolios
- giving helpful investment advice
If you make the decision to become a money manager, you’ll have the rewarding chance to buy and sell securities for maximizing your clients’ returns.
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