How Do I Become a Financial Advisor?

Financial advisors offer strategies to individuals seeking help with insurance, income tax, retirement and investment decisions. Although there are no strict requirements for becoming a financial advisor, success often depends on earning an academic degree and professional certification. Schools offering Chartered Financial Analyst (CFA) degrees can also be found in these popular choices.

Becoming a Financial Advisor

Most financial advisors complete a degree program (often in in finance, economics, accounting, business, mathematics, or law) and attain licences, which are usually required, applicable to their specific role. For example, those who work in stocks or insurance and with firms must have product licenses and/or be registered with a state regulating body. Additionally, certifications and graduate degrees can help with career advancement.

Many people turn to a financial advisor to help them sort out the myriad options for funding a college education or retirement plan, in addition to guidance for decisions regarding insurance, taxes, real estate and wealth management. Effective financial advisors understands their clients' needs and circumstances (e.g., financial knowledge, risk tolerance, lifestyle and goals) and make recommendations accordingly.

Important Facts About Financial Advisors

On-the-Job Training Supervised; lasts more than a year
Required Education Bachelor's degree
Work Environment Primarily in offices intermixed with travel to conferences or financial lectures
Similar Occupations Budget analysts, financial analysts, financial managers, insurance sales agents, insurance underwriters, real estate brokers, securities, commodities, and financial services sales agents

Required Skills

A thorough grasp of mathematics, economics and finance is critical to success in this profession. In addition, a good financial advisor must have:

  • Analytical Skills: In designing a portfolio, an advisor should be able to assess various types of information, including economic trends and regulatory changes.
  • Interpersonal Skills: Building trust and comfort with clients and being well-responsive when addressing concerns.
  • Math Skills: Naturally, being able to easily compute increases, decreases, totals and distributions is needed.
  • Sales Skills: Being persuasive and convincing to sell products and services.
  • Speaking Skills: Explaining complex concepts in clear manner.

Certifications

Certifications demonstrate expertise and knowledge to potential employers. The most common certifications are:

  • Certified Financial Planner (CFP) designation, requiring a bachelor's degree, three years of experience and successful completion of the CFP course of study and an exam developed by the Certified Financial Planner Board of Standards.
  • Chartered Financial Consultant (ChFC) designation, requiring three years of experience and successful completion of the ChFC course of study and an exam developed by American College in Bryn Mawr, PA.

Salary Information and Employment Outlook

In 2014, financial advisors earned an average of $108,090 per year, according to the U.S. Bureau of Labor Statistics (BLS). Most of these professionals at that time made between $35,500 and $139,350 annually, with the median wage at $81,060. The BLS predicts that employment of financial advisors will rise 30% between 2014 and 2024.

To continue researching, browse degree options below for course curriculum, prerequisites and financial aid information. Or, learn more about the subject by reading the related articles below:

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