Financial Advisor Franchise: Everything You Need to Know Before You Start

franchise

Opening a financial advisor franchise can be a lucrative business opportunity, but there are several things you need to know before you get started. 

This article will outline the requirements and costs for starting a franchise operation and the pros and cons of opening a franchise versus an independent financial advisor business. After reading this article, you should have a better idea of if starting a franchise is the right option for you.

 

What Are Financial Advisor Franchises?

Financial advisor franchises are businesses that offer financial planning and investment advice to clients. These businesses usually have a team of financial advisors who work with clients to help them reach their financial goals.

The difference between a franchise and running your own financial advisor business is that with a franchise, you are buying into an existing business model. You will have access to the franchise’s branding, marketing, and support systems.

 

Requirements for Starting a Financial Advisor Franchise

Opening a financial advisor franchise can be a great way to start the financial planning industry. However, there are some things you need to know before you get started. Here are the requirements for starting a financial advisor franchise. You must:

  • Have a bachelor’s degree in business, finance, or a related field
  • Have at least three years of experience working in the financial industry
  • Pass a background check
  • Be able to commit to working full-time
  • Have access to a computer and the internet
  • Have money to pay the initial franchise fees
  • Have enough liquid capital to cover your expenses for the first 6 months
  • be able to obtain a business loan

 

Costs of Starting a Financial Advisor Franchise

Starting a franchise often requires startup costs, including initial franchise fees, marketing expenses, and professional fees. The total cost of starting a financial advisor franchise can range from $60,000 to $250,000.

  • Initial Franchise Fee: The initial franchise fee for a financial advisor franchise is typically between $10,000 and $50,000.
  • Required Liquid Capital: You will also need access to a certain amount of liquid capital. This is the money you will need to cover your expenses for the first 6 months of operation. The required amount of liquid capital for a financial advisor franchise is typically between $50,000 and $100,000.
  • Marketing Expenses: Marketing expenses will vary depending on the size and scope of your marketing campaign. However, you should expect to spend several thousand dollars on marketing when starting your financial advisor franchise.
  • Professional Fees: You will also need to pay professional fees, such as financial planning software, website development, and accounting services. These fees can range from a few hundred dollars to several thousand dollars.
  • Franchise Royalties: In addition to the initial franchise fee, you will also be required to pay ongoing royalties to the franchisor. These royalties are typically a percentage of your monthly sales, ranging from 5%-10%.

 

Pros of Opening a Financial Advisor Franchise

Now that you know the requirements and costs of starting a financial advisor franchise, let’s take a look at the pros of opening one:

  • You will have access to an existing business model: When you open a financial advisor franchise, you will be buying into an existing business model. This means that you will have access to the franchise’s branding, marketing, and support systems.
  • You will benefit from the franchisor’s experience: The franchisor will have a wealth of experience in running a financial advisor business. This means that they will be able to provide you with valuable advice and support.
  • You will have access to the franchisor’s resources: The franchisor will also have access to various resources, including financial planning software, website development, and accounting services.
  • You will have a built-in customer base: One of the biggest advantages of opening a financial advisor franchise is that you will have a built-in customer base. This is because the franchise already has a well-established reputation in the industry.

 

Cons of Opening a Financial Advisor Franchise

Of course, opening a financial advisor franchise also has some potential drawbacks. These include:

  • You will be required to follow the franchisor’s rules and regulations: One of the biggest disadvantages of opening a financial advisor franchise is that you will be required to follow the franchisor’s rules and regulations. This can include everything from how you market your business to your products and services.
  • You will have to pay royalties to the franchisor: As we mentioned, you will also have to pay royalties to the franchisor. These royalties range from 5%-10% of your monthly sales.
  • You may have difficulty standing out from the competition: Another potential drawback of opening a financial advisor franchise is that you may have difficulty standing out from the competition. This is because there will likely be other financial advisor franchises in your area.
  • You may have limited growth potential: Finally, you should also be aware that you may have limited growth potential when you open a financial advisor franchise. You will be restricted to the franchisor’s rules and regulations.

 

Financial Advisor Franchise Opportunities

Now that you know everything about financial advisor franchises, you may wonder what opportunities are available. Below are a few financial advisor companies that offer franchise opportunities.

  • Compass Planning Associates: Compass Planning Associates is a financial planning firm that offers franchise opportunities. The company was founded in 2002 and has grown to include franchises in all 50 states.
  • Investment Services Group: Investment Services Group is another financial advisor company that offers franchise opportunities. The company was founded in 1985 and currently has franchises in 35 states.
  • New England Financial: New England Financial is a financial services company that offers financial advisor franchises. The company was founded in 1835 and has franchises in all 50 states.
  • Principal Financial Group: Principal Financial Group is a financial services company that offers financial advisor franchises. The company was founded in 1875 and has franchises in all 50 states.
  • Wealthfront: Wealthfront is an online financial advisor company that offers financial advisor franchises. The company was founded in 2008 and has franchises in all 50 states.

 

Conclusion

Everything you need to know about financial advisor franchises. Now it’s time to decide if this business opportunity is right for you. Remember, if you do choose to open a financial advisor franchise, be sure to do your research and choose a reputable franchisor.