The benefits of starting a side hustle
A side hustle involves making money from a venture outside of your day job. Mention you have one, and many people will assume you sell craft in an Etsy shop or blog about food in your spare time.
But some financial advisers are embracing the concept to enhance their advice brand and reach more consumers - while earning extra income in the process.
Financial adviser Glen James founded financial education podcast ‘My Millennial Money’ and website sortyourmoneyout.com as side hustles to his financial planning business, Fortify Financial.
For James, the aim was to provide financial education to more people than he could reach one-on-one, and to target Millennials who want to learn but often lack the capacity to pay for advice. “I wanted to do something online so I made a blog - sortyourmoneyout.com … I wanted to do something a bit more fun and engaging. That’s when I created My Millennial Money,” he says.
Through his blog and podcasts, James has become a trusted information source for subscribers who would be less likely to engage with a financial adviser through traditional pathways.
James enjoys putting his financial planning expertise to work to broaden the audience for advice. He says ‘My Millennial Money' prepared consumers to seek personal financial advice from his financial planning business or other financial advisers.
The top three factors Australians look for when choosing a financial adviser are: level of experience; reputation; and the financial adviser’s ability to talk to them in a way they understand, according to the Australian Securities and Investments Commissions’ report Financial Advice: What Consumers Really Think.
Creating a podcast or blog allows financial advisers to demonstrate their expertise and communication skills, which can help to attract and retain clients. Other side projects that could achieve similar results include writing or being quoted in press articles, running courses at a community college, or publishing an eBook.
Firefly Wealth founder Adele Martin refers to a marketing concept known as the mere-exposure effect. “The more people see you, the more familiar they are with you, the more they trust you,” she explains. “In the past, people only needed to see you five or six times to trust you. Now with information overload, people are more sceptical. People need to see you nearly 20 times before they trust you.”
Martin regularly appears on television, radio, and in print and digital media. She runs a Facebook group called ‘The Savings Squad’ and an online savings and goals course called ‘My Money Buddy’ in addition to a full-service financial planning business.
Hustle and bustle
The key to running a successful side hustle - on top of a day to day advice business - is to manage your resources by focusing on strengths and outsourcing weaknesses, says James. “Don’t get overwhelmed: get help and pay for it. You just have to take that step and have a strategy,” he says.
James recently merged his financial planning business with another practice to better support clients while he brings in business. Martin employs an Operations Manager, Technical Adviser and Marketing Assistant to help her manage her time and serve clients most effectively.
Working on a side project can be an energising experience, in addition to boosting a financial adviser’s reputation and attracting clients. The Side Hustle Economy whitepaper by the University of Reading found that 69% of people with a side hustle felt more positive about life for having two roles.
And then there’s the extra income.
Show me the money
James has monetised his side hustle by selling online training courses on how to set up a spending plan and manage cash flow for $69 each.
He sells sponsorships for episodes of the ‘My Millennial Money’ podcast and is looking for a partner to sponsor the show and its Facebook group. He also receives referral fees for generating leads for mortgage brokers and other financial advisers, and has paid gigs writing for publications such as a Wellness magazine.
“I’m not putting all my revenue eggs in one basket, so to speak,” he says.
Side hustles for financial advisers don’t have to be consumer facing. Financial advisers with special skill sets might use side projects to showcase their knowledge, build their reputation and boost their financial planning brand, while bringing in extra revenue.
Financial advisers with well-developed soft skills could demonstrate their expertise by training industry newcomers on how to work with clients face-to-face, for example. James uses his advanced understanding of Millennials to advise banks and superannuation funds on how to engage better with this demographic. Martin consults to Dealergroups and financial advisers on how to use social media more effectively.
Ease the margin squeeze
Extra revenue always comes in handy but there’s never been a better time than now to identify new income sources.
The average financial adviser loses $550 in onboarding each new client, the April 2019 Investment Trends Licensee Satisfaction Report found. Average annual margins per client are down from $2650 in 2014 to $1750 in 2019, the survey of 1030 financial advisers found.
A well-chosen income-generating side hustle could help fill the revenue gap as well as add value to a financial adviser’s core business in terms of brand enhancement and lead generation.
Find your hustle
So where to begin?
James recommends financial advisers think about what they could do online. “Can you develop some type of digital product that you can sell or give away as a lead generation tool that adds value?” he asks.
Martin suggests financial advisers look to other industries for inspiration on how to broaden their financial advice brand. She points to fitness guru Michelle Bridges, who has built a $60 million a year business that goes beyond personal training to encompass add-on ventures including the 12 Week Body Transformation program, television appearances, and partnerships with Woolworths supermarket.
While financial advisers don’t have to go to extremes, those who think beyond their traditional role can boost their businesses and develop new revenue streams on the side.
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