When you hear the word financial advisor, it is also similar to a financial therapist. So, if you think you can actually help people manage, save, and invest their money in order to meet their financial goals, then becoming a financial advisor is a good career path for you.
For this cause, you might be wondering how to really become a licensed financial advisor. However, the process of how to become a financial advisor tends to vary depending on the kind of advising you want to do.
Based on most jobs, the path on how to become a successful financial advisor basically begins and ends with a quality degree education. While many financial advisors will go forward to earn certification and become a Certified financial advisor.
Of course, being a financial advisor is more than just understanding finances. There is a lot of specific knowledge to understand, not to mention the search for the right education and the licenses and certifications necessary to provide financial advice in a professional manner. This is what you need to know in order to become a financial advisor.
This article aims to give you a full guide on how to become a financial advisor. Equally, we will be giving a rundown on the School you can study finance as well as how much a certified financial advisor earns.
What Does a Financial Advisor Do?
The term “financial advisor” is quite broad. In its most general form, a financial advisor is what it seems: someone who advises clients on finance. It may only be about listening and providing advice and guidance to people who are about to make big financial decisions, but with a little specialized training, it can end up being much more than that.
Equally, financial advisors help clients make more informed financial decisions. These decisions can be related to everything, from how to start investing in retirement or estate planning.
Most importantly, the position requires great financial and investment knowledge, but also a great sales capacity. They can work in a variety of contexts, the most common being large financial institutions. Such as banks or brokerage firms with smaller businesses, and increasingly independent advisors.
Some consultants specialize in a certain area (such as retirement planning or investment management), a particular type of client (such as those in a net worth or age group) or a specific type of account (such as countertops).
Even after all the necessary training required for financial advisors, they never stop learning. New investments, tax laws, economic risk factors and much more come into play. And as someone who manages someone’s money for a living, financial advisors must know every one of them, so they don’t start giving outdated information.
Why do you want to be a Financial Advisor
Most times, this question of ”why do you want to be a financial advisor” is what people face as interview questions. And they tend to fail the interview because they have no great reason why they want to become a financial advisor.
Basically, the answer to this question is not just all about the fact that you can help people to save, manage, and invest their money. It is worthwhile to know that choosing a financial advisor career path is for professionals who want to make a difference in the lives of others.
Hence, when you decide if you should become a financial advisor, look at what you are naturally good at. If you like the idea of running a business, getting customers, marketing and helping people while having the ability to make a lot of money, then this is a good area to try.
Equally, financial advisers need strong interpersonal and analytical skills. They must be able to analyze investment and financial data and then communicate their findings clearly to their clients.
How Do I Become a Financial Advisor?
Financial advisors do exactly what the name suggests. They work with clients to assess their current financial situation and future plans, economic conditions and forecasts and regulations, to provide financial advice.
Get a Bachelor’s Degree
Good news! If you are currently enrolled in college and are preparing for your bachelor’s degree, you are already on your way to becoming a financial advisor.
Earning a bachelor’s degree is the first step to becoming a financial advisor. When it comes to certain degrees, there are a number of different majors that can help you propel yourself into financial planning. The most obvious choices are degrees in finance and economics. In many cases, however, degrees in math, accounting, real estate, and general commerce will be more than enough.
Most of the current financial advisors specialize in a type of business or financial program. If you are considering a career in financial counseling, it may also be a good idea to find and interview someone who is currently working in the field.
Complete an Internship
While you are still in school, it is a good idea to do an internship at a financial advisory company or a single professional. Internships will help you discover the first-person career and understand what it means to be a daily financial advisor.
Internships also represent an opportunity to establish contacts with existing financial advisors and potentially find a mentor. Some of the relationships he will develop as an intern will follow him throughout his career.
Finally, an internship looks good on your CV. Most employers prefer to hire people with experience. Of course, as a recent graduate of the university, you will not have much experience, if you have any.
An internship offers an invaluable opportunity to gain experience and demonstrate your active interest in becoming a financial advisor. Hence, consider applying for an internship before getting a job.
The field of financial advice is competitive. Once you have graduated and gained some experience as an intern, it is time to start the job search. Many consultants seek certifications or licenses to help them develop a specialty or differentiate themselves from their competitors.
Once you have acquired some experience in the field, you will have a better idea of the type of work you enjoy as a financial advisor. This experience will help you decide which certifications are best suited for the career you wish to develop.
Some common certifications and licenses sought by financial advisors are:
Pursue Additional Education
The thirst for knowledge will be useful in any career. Financial counseling professionals often return to school to pursue higher education or even a doctorate. His work is based on his ability to provide valuable financial advice to clients.
The search for continuing education is a tangible way to demonstrate your commitment to providing excellent service throughout your career. The demand for financial advisors is high and will continue to grow as our company acquires financial skills and recognizes the importance of making good financial decisions.
Now that you understand how to become a financial advisor, you are ready to start your own career and start providing valuable advice.
How Much Does a Financial Advisor Cost
Financial advisor cost varies, but most paid financial planners will charge between 1,000 and $2,000 for a complete financial plan. To get continuous advice, you can expect to pay a monthly few hundred dollars to them.
Some financial advisors charge their fees from banks and investment companies. In general, these are the advisors you will find sitting at your local bank or at a branch of a large brokerage company.
Although they offer “free” advice, which can be tempting, these advisors generally receive commissions on the investments they sell. Over time, being in the wrong investments can cost you more than paying only a paid advisor.
So pay a Financial Advisor today and save yourself the cost!
How Do I Become a Financial Advisor Without a Degree?
Generally, becoming a financial advisor does not require a degree. Although training and a license are required to be a financial advisor. It does not always mean that they know how to invest inside and out.
Basically, there are always changes in laws and new investment products. The point is that an advisor does not need much experience or knowledge to have a large number of clients. I have seen this firsthand with advisors who are not aware of a series of regulations, even if they should.
Being a financial advisor does not mean investing first, but it is a matter of relationships. So, that a financial advisor has a large clientele does not mean he is a good advisor. This is also true with an advisor who has a degree and certificates.
However, they must pass certain exams administered by the Financial Industry Regulatory Authority, or FINRA. Which is responsible for managing the business between the investing public and the brokers to ensure that the advisors are qualified.
In fact, most advisors have at least a bachelor’s degree in areas related to finance. Those who wish to advance in their careers tend to follow the path of the Master of Business Administration (MBA).
The good news of being a very successful financial advisor is that you will make your own decisions and it can be a really rewarding career. There are good, well-informed financial advisors, but it is rare to combine these two qualities. Try to be one of the few.
What is the Financial Advisor’s Salary?
Well, the most recent information from the BLS indicates that the average salary of the financial advisor, in May 2018, was $88,890. States like New York, D.C. and Wyoming offer some of the highest salaries in the country for financial advisors. And those in the richest 10% could earn more than $200,000.
The most common industry for financial advisors is the world of investments (securities, commodity contracts, and other financial investments and related activities), where they have an average annual salary of $129,950. Financial advisors in the real estate world, although they were a much smaller group, had an average annual salary of $161,860.
Due to the aging of the population that needs financial advice, a financial advisor is a profession for which the BLS forecasts better than average growth, with an expected growth of 15% compared to 2016-26.
What are the Top Schools for Financial Advisors?
At some point in the life of a Financial Adviser, there is a need to become a certified financial advisor. Basically, there are always changes in laws and new investment products.
Hence, you need a bachelor’s degree for start, typically in finance, accounting, business, economics, statistics or a similar field. For this reason, we have a list of top schools for Financial Advisors.
These Financial Advisors Schools do not necessarily mean that you will study financial advising but a related course like finance.
So here is a list of top and accredited schools for financial advisors in the world:
New York University – Leonard N. Stern School of Business
Basically, New York University Leonard N. Stern School of Business is the business school of the University of New York. He is also a founding member of the Association to Advance in Collegiate Business Schools.
They believe, that finance provides the technical and analytical skills necessary to understand the operation of financial markets. As well as the operation of companies and decision making within these markets.
Above all, this concentration will help you prepare to enter the financial sector, either in financial institutions and divisions or in governmental or non-profit institutions.
University of Pennsylvania – The Wharton School
Wharton is known worldwide as The Finance School. For a long time dominant in financial education, Wharton alumni, students, and teachers are addressing global financial challenges and opportunities. Especially, through alternative investments, fintech, impact investments and financial inclusion
Massachusetts Institute of Technology – Sloan School of Management
MIT Sloan School of Management is the business school of the Massachusetts Institute of Technology in Cambridge, Massachusetts, United States. MIT Sloan offers bachelor’s, master’s and doctoral programs, as well as executive education. Their study programs are among the most selective in the world.
Are you very successful and looking for a rewarding career in finance? The MIT Master of Finance program includes a rigorous 12 or 18 months STEM program, focused on the functioning of markets and designed around the most advanced financial theories, quantitative models and industrial practices.
University of Michigan – Stephen M. Ross School of Business
Stephen M. Ross Business School is a business school run by the University of Michigan. It offers bachelor’s, master’s and doctoral degrees, as well as an executive training program.
Finance in Michigan Ross covers a wide range of topics, from social capital to asset pricing and the causes of the financial crisis. This broad base of knowledge and experience distinguishes it from the field. The teaching of the famous Michigan Ross School of Finance is relevant to today’s complex business world, and his hard-hitting research is published in the best magazines.
Ph.D. students in finance from the Stephen M. Ross School of Business have access to a large and active finance university with diverse research interests. The faculty devotes significant resources to the doctoral program, recognizing that it is essential to have a high-level doctoral program to maintain an exceptional research environment.
University of Texas – McCombs School of Business
The McCombs School of Business, also known as McCombs School or simply McCombs, is a business school at the University of Texas at Austin. In addition to the main campus of downtown Austin, McCombs offers courses outside of central Texas in Dallas, Houston and internationally in Mexico City.
The professors of the Department of Finance give courses in finance and real estate in the three main academic programs offered at the McCombs School of Business: the Bachelor of Business Administration (BBA), the Master of Business Administration (MBA) and the Ph.D. in philosophy (Ph. D.) and in the certification program of Business Fundamentals.
University of California – Haas School of Business
The Walter A. Haas Business School, also known as the Haas Business School or Berkeley Haas, is the business school of the University of California at Berkeley. Basically, the school is located in four buildings surrounding a central courtyard in the southeast corner of the UC Berkeley campus.
Equally, the Berkeley Haas financing program has long been held in high esteem by researchers and finance professionals, at home and around the world. Finance here is a first-level program, which includes U.S. News in 2017.
Above all, the Berkeley MFE program at the Haas School of Business offers a depth of study in finance that is not available in traditional MBA programs.
Finally, a Haas PhD student interested in finance needs a solid background in mathematics and statistics. This is a prerequisite for the sequence of doctoral seminars in finance.
University of North Carolina – Kenan-Flagler Business School
The Kenan – Flagler Business School is the undergraduate and graduate business school of the University of North Carolina at Chapel Hill. Basically, they offer undergraduate and postgraduate courses in finance.
Most importantly, PhD students in finance benefit greatly from their collaboration with their world-class faculty. Especially those who appreciate working with doctoral students and have designed many courses to specifically meet their needs.
The concentration in corporate finance teaches basic skills in financial models, debt and capital issues. As well as valuation, mergers and acquisitions, financial planning, risk management, financial reporting and analysis, and taxation. These are necessary for corporate finance positions and other careers, such as consulting.
Indiana University-Bloomington – Kelley School of Business
The Kelley School of Business is an undergraduate and graduate business school at Indiana University in Bloomington, United States.
Most importantly, the Ministry of Finance of this institution is widely recognized as one of the main finance ministries in the world. Also, the undergraduate program provides complete information about the bachelor’s requirements,
Meanwhile, the Kelley School of Business offers a Master of Science in residential and online finance. In addition, they have partnered with Tsinghua University in China to offer a joint master’s degree in finance.
University of Virginia – Darden School of Business
The Darden School of Business is the graduate business school associated with the University of Virginia in Charlottesville, Virginia. Darden School offers an MBA, a PhD, and executive training programs.
Above all, the study of finance at the University of Virginia develops the key evaluation skill: projects, titles, complete businesses and the incremental effect of the new policies.
Carnegie Mellon University – Tepper School of Business
Tepper Business School lives in the heart of Carnegie Mellon University, guided by a mission to transform the world, pioneer and innovative in the intersection of business, technology and analysis.
For 25 years, the leading interdisciplinary master’s program in financial computer science at Carnegie Mellon University has been preparing students for very successful careers in quantitative finance.
How to Become a Financial Advisor FAQs
How long does it take to become a financial advisor?
To become a Certified Financial Advisor, one must hold a bachelor’s degree, complete a CFB Board-registered course of study, gain three years of experience as a financial advisor, and pass a certification exam.
What qualifications do you need to become a financial advisor?
The minimum educational requirement for financial advisors—also known as financial consultants or counselors—is a bachelor’s degree, typically in finance, accounting, business, economics, statistics or a similar field.
Is it hard to be a financial advisor?
Financial advisors that succeed find themselves in a career that provides them not only a healthy income but personal fulfillment too. Putting it simply, being a financial advisor is not really HARD.
Can I become a financial advisor without a college degree?
Generally speaking, it is not necessary to have a college degree to become a financial advisor. However, many firms will view it as a prerequisite for new hires, especially those with prestigious training programs. What is required are licenses and registration with FINRA, the financial services regulatory body.
How do financial advisors get paid?
A financial advisor receives a trailer fee, which is a fixed percentage of a client’s investment in a mutual fund, as long as the client’s money remains invested in the fund. Also, financial advisors are typically paid out of front- or back-end loads that a mutual fund charges when its shares are bought or sold.
Hiring a financial advisor can be expensive, but for some, it may be a worthwhile investment. If you feel lost in your finances, want a second opinion or simply do not like to manage your money on your own, try a financial advisor.