Financial Advisor Ranks Among Best Jobs of 2017
It's an exciting time to be a financial advisor, since several decades ago, the position didn't really exist. You were either a stockbroker or a community banker or even in insurance sales, according to James Kinney, a certified financial planner and founder of the New Jersey-based Financial Pathways. Now, however, financial advisors perform all these roles, from small independent practices to big investment firms. "As a larger portion of the industry shifts away from the banks, brokers and insurance companies, additional opportunities have opened," writes Eric Schaefer of the Virginia-based wealth management, investment and financial planning firm Savant Capitalin an email. "As this transition takes place, many advisors have gone independent or created ensemble relationships in new businesses. These new businesses need young, energetic and driven professionals to leverage the time of senior advisors and provide for the future continuity of the business." Put simply, financial advisors meet with clients and counsel them on their finances. This could mean sitting down and creating budgets to firming up retirement plans to giving advice about investing. Financial advisors can also invest a client's funds and meet with him or her regularly to discuss their investments. Some are also licensed to sell insurance. Many times, financial advisors help plan a safe, comfortable future for their clients, but they're also called upon when the unexpected occurs –perhaps an aging parent suddenly requires a live-in nurse, a couple plans on divorcing or a child needs to transfer to an expensive private school. Financial advisors may step in and make sense of these fiscal troubles and create a plan for moving forward. For that reason, Schaefer explains, "Good financial advisors and good teachers tend to have a lot of traits in common." He points out that advisors must be able to listen to their clients; explain complex ideas in
easy-to-understand ways; and be able to sympathize with their clients.
This is expected to be one of the faster-growing occupations over the next decade, with a projected growth rate of 30 percent through 2024, according to the Labor Department. That's an additional 73,900 new positions on top of the 249,400 jobs financial advisors held in 2014. The retirement of baby boomers in need of financial planning advice is one driver of the expected growth. Still, employment may be tempered by the increasing number of online advisory tools, which may divert clients from seeking financial advice in person.
To be a financial advisor, you need financial expertise and a desire to help people. A bachelor's degree is typically a good starting place, but you can choose a broad range of degrees – from finance to business to something entirely different. Increasingly, universities have begun offering financial planning degrees, too. However, Schaefer says, "My colleagues and I agree that 80 percent of our job is psychology, and only 20 percent is financial. I know successful owners of financial advisory firms that specifically recruit psychology majors for this reason. Though a business or economics degree will better prepare a professional to take industry exams or explain financial products, the ability to understand the core concerns and goals of a client or prospective client is much more valuable."
The Certified Financial Planner exam is required to become a CFP – a distinction that looks good to employers. You can also acquire other designations if you want to specialize in a certain area of financial planning. For instance, you can complete the necessary coursework and exam to acquire the Chartered Retirement Plans Specialist, or CRPS, designation. And if you plan on buying or selling stocks or selling insurance, you'll need to procure state-specific licenses.