The finance manager at a car lot is the last person shoppers see before they close the deal on their new cars. These managers are known as finance and insurance managers -- shortened to F&I managers -- and they bring in profits and commissions to the dealership and play an important role in the sale of each vehicle.
F&I managers need to have many of the same credentials that finance managers in other industries have, such as a bachelor’s degree in finance or accounting. They also need to be exceptional at sales in order to get customers to sign on the bottom line. Traditional F&I manager training is geared to teach managers how to run the numbers, fill out the necessary loan papers, run credit reports and ensure customers have adequate insurance. Many F&I managers get their sales training from the floor, selling cars before they move into the financial role.
In 2010, finance managers in general made a median income of $103,910, according to the U.S. Bureau of Labor Statistics, though those salaries can be in addition to substantial commissions. Effective F&I managers who can win over the trust of customers can chalk up big bonuses, too. According to Edmund’s, an informational automotive site for consumers, finance and insurance managers bring in as much as 28.5 percent of the dealer’s profit on a sale, which is why good finance managers are so highly valued and well paid in the industry.
The primary job of F&I managers is to secure financing for clients, preferably through one of the dealership’s in-house finance companies or a partner bank or financing company. By keeping financing close to home, F&I managers and dealerships are able to keep customers close, giving them more opportunities to sell more add-ons, like added service contracts and loan insurance. F&I managers have a number of resources at their disposal for financing, depending on the credit worthiness of their customers. Ideally, these managers will look to pick up additional commissions by securing business for their lending partners.
The negotiations and opportunities for more sales don’t end once a car dealership salesperson has sold a car. The F&I manager's responsibility is to promote all the additional services and products the dealership offers that bring in the most markups for dealerships. An F&I manager needs to present the features and benefits of services like extended warranties, undercoating, after-market add-ons like pin-striping and window etching and service contracts. They easily overcome objections by drawing on an in-depth knowledge of the products and of the customers, who they know quite well after going over their credit reports.
Back to the finance background – finance managers are responsible to make sure all the paperwork is signed, sealed and delivered to the appropriate departments and outside vendors. Even if the salesperson fills out a lot of the initial sales contract, they double-check to make sure everything is correct. F & I managers explain the details to customers before they sign and make sure they know when payments are due and what penalties they face when late. In many dealerships, the F & I manager also trains salespeople in how to correctly complete the reams of documentation that go into a new car purchase.
2016 Salary Information for Financial Managers
Financial managers earned a median annual salary of $121,750 in 2016, according to the U.S. Bureau of Labor Statistics. On the low end, financial managers earned a 25th percentile salary of $87,530, meaning 75 percent earned more than this amount. The 75th percentile salary is $168,790, meaning 25 percent earn more. In 2016, 580,400 people were employed in the U.S. as financial managers.
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