As the name implies, a financial advisor provides financial advice directly to clients. Their job is to make recommendations, explain options, and help guide people through difficult financial decisions related to investing, retiring, and preserving wealth, among other tasks. In order to do this, a financial advisor may also recommend certain tax strategies and insurance options in order to save money and provide additional financial security for clients and their families.
Many of the financial advisors are self-employed. Even the ones who work for investment companies are often hired as independent advisors and are not provided with a salaried position. Instead, they're paid commission based on the amount of money which they have under management. As such, the goal of a financial advisor is to always grow their business by attracting new clients and more money for the services they provide. In order to do this, advisors must be quick learners, excellent salespeople, and have great communication skills in order to sway clients towards investment opportunities.
Financial Advisors should also be willing to go the extra distance in order to retain clients. This may often mean meeting with them after hours, on holidays, and during weekends.
While not an absolute requirement, many financial advisors have a bachelor's degree, which helps their credibility. They may have degrees in fields such as finance, business or economics*. A few even have master's degree in finance-related studies. Obtaining various financial certifications may also be required in order to more easily gain the confidence of prospective clients, such as a CFP (Certified Financial Planner) certificate**.
The median pay for financial advisors is approximately $64,750 a year***. It is a profession, however, where there really isn't an average pay scale. In fact, the most successful advisors can earn as high as seven figures in a given year, while those on the lower end make substantially less. Since compensation is usually based on a commission or their an advisor's own hourly/flat rates, there can be an unlimited potential for those who are truly motivated and talented enough to take advantage of it.
The Bureau of Labor Statistics projects massive growth in the financial advisory industry, with jobs for advisors anticipated to increase by 32% between 2010 to 2020***. Much of this growth can be contributed to baby boomers reaching retirement and wanting to explore investment options going forward. That, coupled with younger workers wishing to save more aggressively for retirement, has created an opportunity for motivated individuals with an interest in financial advising.
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*For more information, please visit: http://www.ehow.com/about_5048170_requirements-become-financial-advisor.html
**For more information, please visit: http://guides.wsj.com/personal-finance/managing-your-money/how-to-choose-a-financial-planner/
***For more information, please visit: http://www.bls.gov/ooh/Business-and-Financial/Personal-financial-advisors.htm