• / Free eNewsletters & Magazine
  • / My Account
Home>Practice Management>Practice Builder>Building the Business 101: A Renaissance Man of Career-Changers

Related Content

  1. Videos
  2. Articles
  1. What Makes a Manager of the Year?

    Our Manager of the Year Award is meant to recognize managers whose time-tested long-term strategies have really shined in the past year, says Morningstar's director of fund analysis.

  2. Want Dividends? Look Outside the U.S.

    Royce Funds' David Nadel discusses how non-U.S. cultures influence dividend payers, why Europe thrives on exports to emerging markets, and a growth story in Africa.

  3. Session 2: Midyear Portfolio Checkup and Risk Factor Review

    Director of personal finance Christine Benz will help you check your true exposures and stress-test your holdings in session 2 of Morningstar's 2012 Midyear Financial Checkup.

  4. Session 3: Best Investment Ideas Roundtable

    A panel of Morningstar equity, mutual fund, and ETF experts detail several individual investment opportunities and sensible investing strategies for income and growth in today's tough market.

Building the Business 101: A Renaissance Man of Career-Changers

Everette Orr's took the scenic route toward a career in financial planning.

Veena A. Kutler and Annette F. Simon, 06/26/2008

This monthly series of articles describes the many steps and occasional missteps we have taken in building our financial advisory business, Garnet Group LLC. Currently, Garnet has eight staff members, more than 90 clients, more than $300 million in client net worth under advisement, and offices in Bethesda, Md., and Boston. Veena Kutler, CFA, and Annette Simon, CFP, are the managing principals in the Garnet office in Bethesda.

More so than most other professions, the financial-planning profession seems to attract midlife career-changers. We know planners who have entered the field in their 30s, 40s and 50s from careers as varied as lawyers, bankers, English professors, and physicians. Why does financial planning attract accomplished individuals with such wide-ranging backgrounds? We don't have a definitive answer, but we believe that there are several characteristics that make the field attractive to more-mature individuals:

1) Many advisors, especially career-changers, start out as independent business owners. The ability to create your own business, determine your own hours and working conditions is very appealing, especially for people who have been working in a larger organization with rules and limits dictated by others.

2) Success in our profession requires solid technical and analytical abilities, as well as strong interpersonal and communication skills. This is a fairly unique combination and presents the kind of challenge many people are looking for after some years in the workplace.


3) Financial planners are able to help individuals solve real and significant problems in their lives. There are few vocations that offer the opportunity to perform such a personally rewarding service--even fewer that are accessible to a midlife career changer.

Many of our colleagues entered the profession after facing a financial planning challenge within their own lives. This was the case for both of us. Annette, who has a background in management consulting, became a financial planner 12 years ago, after the death of her father. A complicated family situation and some questionable last-minute changes in his will left her determined to learn more about financial planning and interested in devoting her life to helping others avoid unexpected and unintended consequences as a result of their financial decisions. Veena's interest in personal finance first began with her own family's estate-planning process 10 years ago and increased as she began thinking of careers that would allow her to do meaningful work while having the flexibility to spend more time with her children.

One of our local colleagues and friends is the quintessential second-career financial planner. Everette Orr is the founder and sole owner of Orr Financial Planning, LLC in McLean, Va. We have both known and admired Everette for many years and consider him a real Renaissance man. Everette is a CPA, CFP, and CFA, and a planner dedicated to working with the middle-income market. His story is a great illustration of a successful career change into the financial planning profession. We interviewed him recently and felt that anyone considering a move into our profession could learn a lot from his example.

The Interview

Garnet: Tell us the about the path you took to starting and running your own solo planning firm. You didn't start off as a planner.

Orr: Well, I've just turned 60 and I'm happy to say just completed my first 50K--a daylong hike organized by the Sierra Club. I graduated college in 1976 and became a CPA in the same year. I went back to work for the federal government from then till I retired in 1999.

Garnet: To some, the term "government job" conjures up the image of a bureaucrat sitting behind a large desk shuffling papers. Does that fit your job description as a Federal employee?

Orr: Actually, that couldn't be further from my job description. I worked as an auditor during my government career for the Agency for International Development. By the time I retired, I was head of audit for the U.S. foreign aid program and managing about 200 people. I traveled to 65 countries and was stationed for extended periods in Africa and Central America. My kids have fond memories of growing up in Kenya. One interesting project I did was auditing former CIA camps during the demilitarization of the contras in Nicaragua. So you could say while I was involved with finance during my entire government career, it was at the 20,000 foot level and not on the personal level. As part of my job, I met many people and saw how much help they needed with their finances. I decided that when I left government I would focus on personal finance.

I retired on a full government pension so I knew that I could afford to earn zero to a small salary for quite a few years while learning my new profession. I tell new planners this all the time--have substantial savings or a second income in the family when you first start off.

I was interested in fee-only planning and started attending NAPFA study group meetings locally. While attending the meetings, I fortunately met Mary Malgoire, an experienced fee-only planner who provided a great opportunity to me. She invited me to join her firm in an entry-level position. I leapt at the offer and started working for her soon after retiring from the government. In 2000, I passed the CFP examination, which I had taken based on the challenge provision available to CPAs and CFAs.

I spent four years at Mary's company, the Family Firm. I started off shadowing a more-experienced planner and learned the full spectrum of planning--from an in-depth understanding of Excel, to writing plans to meeting with client prospects as well as on-going clients. I started off with working with 12 clients and ended up with 24 clients at the time of my departure. PAGEBREAK

Garnet: Why did you decide to leave and start your own firm?

Orr: I developed a strong desire to work with the middle market, and the Family Firm focused on the higher-net-worth market, so I needed to leave to work with the clientele I wanted to help. There are few large firms that focus on the middle market and are able to hire planners, so I knew if I wanted to do this I'd have to do it on my own. I have the highest regard for Mary and her firm, we parted on the best of terms, and we remain close colleagues and friends to this day.

I evaluated several templates of a middle-income fee-only practice and decided to try the Garrett model. I opened my doors in 2003 as Orr Financial Planning working with middle-income clients. I charge a flat fee for project work and I think that was the right course for me rather than hourly fees. I don't do taxes for my clients. Although I'm a CPA and evaluate the impact of taxes in my client plans, I don't have interest in doing personal tax returns and instead refer my clients out.

I wasn't managing money at first but my clients inundated me with requests that I do so. I became a CFA charter-holder in 2006 and in 2007 began managing client assets using DFA funds and with Fidelity as my custodian. I have about $11 million in assets under management currently. My minimum is reasonable, currently $100,000 although that may change over time.

Garnet: Everette, where do your clients come from?

Orr: Primarily from NAFPA colleagues with firms with larger minimums--like yourselves and my former employer.

Garnet: So Everette, it seems that careful planning and much preparation have allowed you to craft the practice of your dreams. What's next on the horizon for you?

Orr: Change is inevitable. Currently I'm evaluating portfolio reporting software. I'm thinking through hiring my first employee, about partnering with someone and about succession planning.

Garnet: All appropriate items to consider given your stage of business. Any pearls of wisdom to share with our readers--especially those at the start of their planning careers?

Orr: How about these:
* When starting out, you don't know what you don't know so apprentice with an experienced planner.
* Spend a lot of time evaluating options and talking to a lot of experienced planners--I did and it paid off.
* It's a lot harder to make money than most think.
* Passing your CFP may qualify you to be a planner, but not to running a planning business so also focus on learning successful entrepreneurial skills.

Garnet: Amen to all those thoughts. Thanks, Everette.

Conclusion
With his exceptional resourcefulness, razor-sharp analytical skills, and his ability and willingness to generously share his ideas, Orr has been a wonderful inspiration and mentor to us over the years. Like so many of our cohorts in this industry, he reminds us that perhaps the best thing about our profession is the many talented and bighearted people from across the country we can happily call our friends and colleagues.

Next month we'll take a look at women in the financial planning profession--a topic that has gotten some attention in recent months, and one certainly near and dear to our hearts.

Get practice-building tips and information from our team of experts delivered to your e-mail inbox every Thursday. Sign up for our free Practice Builder e-newsletter.

blog comments powered by Disqus
Upcoming Events
Conferences
Webinars

©2014 Morningstar Advisor. All right reserved.