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If you are pursuing a degree in finance, economics, accounting, or business administration, then you may be considering becoming a personal financial advisor. As vital members of the financial industry, personal financial advisors are responsible for utilizing their expertise in giving monetary advice to clients to help with decisions on investments, expenses, insurance, and/or taxes. As large numbers of the baby boomer population reach retirement age and funds for state pensions continually degree, more people are seeking planning advice. In fact, employment of personal financial advisors is expected to grow rapidly by 27%, thus creating an estimated 60,300 new jobs before 2022, according to the Bureau of Labor Statistics. In order to determine if this red-hot occupation is the right fit for your career goals, read on to find a full job overview for personal financial advisors.
What Personal Financial Advisors Do
When first meeting with a new client, personal financial advisors will be responsible for assessing the financial needs of individuals, discussing their monetary goals, and offering guidance on decisions to meet their short and/or long-term objectives. Although most advisors will provide planning advice for a broad array of topics, some choose to specialize in retirement, wealth management, investments, risk management, or another specialty area. Personal financial advisors will explain the various types of financial services available, educate clients about investment options, answer questions about potential risks, recommend investments, and help clients plan for certain situations. After advisors have invested funds for their clients, they are also responsible for providing regular investment reports, monitoring clients’ accounts, making changes as necessary to improve account performance, and adjusting financial plans.
Where Personal Financial Advisors Work
According to the Bureau of Labor Statistics, there were around 223,400 personal financial advisors employed across the nation in 2012. In the vast majority of cases, advisors worked for financial institutions, insurance carriers, brokerage firms, credit intermediation services, and other financial investment activities. Around 20 percent of personal financial advisors are self-employed with their own practices to work directly with clients on a contractual basis. Although most typically work in an office setting, some may need to travel to attend professional conferences, teach finance classes, or meet with clients. Most are employed full-time, but 30 percent report working more than 40 hours each week to market their services to new clients.
How to Become a Personal Financial Advisor
In today’s competitive financial market, it is virtually impossible for individuals to become a personal financial advisor without having at least a bachelor’s degree, although a master’s degree is strongly preferred. Most choose to receive a degree in finance, economics, accounting, mathematics, business administration, or even law. Regardless of your major, it is important to beef up your course schedule with courses related to investments, taxation, estate planning, risk management, and financial planning. Since personal financial advisors often directly buy or sell stocks, bonds, and insurance plans, they need to be registered with the Securities and Exchange Commission. After earning at least three years of relevant work experience, it is also recommended that you consider becoming a Certified Financial Planner (CFP) for the best prospects at management positions, according to the Certified Financial Planner Board.
Related Resource: Investment Fund Manager
Overall, personal financial advisors are highly trained professionals needed to assist clients with making sound financial plans that will meet their monetary needs for years to come. If you want to become a personal financial advisor, it is essential that you possess strong analytical, mathematical, interpersonal, sales, and speaking skills to effectively communicate expert advice to clients seeking guidance in the complex area of finance.
