People live on the money they earn. They work hard every day in order to provide themselves and their families with a source of income and a decent living.

Every week or month, they come home with a certain amount of money, and spend it in a way they think is best. Or they spend it unwisely should they choose to.

On the one hand, there are people who spend money without any plan, hectically and without any plan.

On the other hand, there are those who have a plan and follow it in making their expenditures.

Those in the latter group may make a plan on their own or hire a financial advisor to help them in this endeavor.

Being a financial advisor, if done properly, is a rewarding job.

It is not easy for sure, as this is the person who is there for their clients’ big events in life and helps them with one of the biggest fears people have – fear of running out of money.

A financial advisor should be a person whom clients trust – and this is why a person who wants to be in this profession should have the highest level of professionalism and financial knowledge.

Working as a financial advisor is a lucrative job which requires a lot of skill and good education.

This job is ranked one of the top ten Best Business Jobs in 2019.

If you are interested in becoming a financial advisor but are not sure what the job involves, what skills you need, or steps you should take to that end, read on and find out everything you need to know about it.


1. What is Financial Planning?

Financial planning is a process of organizing how a person spends their money and this is based on their financial situation and their general and specific goals.

First, the financial advisor gathers information about the financial state of the client and about the client.

They need to know when the money will be spent, to what end, and based on those pieces of information, they will make a plan of what steps need to be taken to achieve the desired goal of the client.

2. What Does a Financial Advisor Do?

A financial advisor is a person who helps their clients manage their finances, savings, taxes, insurance, investments, etc. (so, you might as well find out how to find the right person for the job).

They help them define and execute both long-term and short-term goals. Here are some steps that a financial advisor does in relation to one client.

  1. They gather relevant information from a client.
  2. They talk with the client about what they wish to achieve patiently and thoroughly, so as to understand the client’s wished in depth.
  3. They give clear explanations about what type of service they provide and make sure that these meet the client’s needs.
  4. They explain the investment options to the client, the potential benefits and risks.
  5. They help their clients make financial plans for specific purposes such as children’s education or retirement plan.
  6. They follow the client’s accounts and estimate whether any changes should be made in order to optimize spending and saving financial means.

Some financial advisors may choose to specialize in a particular field within financial planning, others in a certain client type, and yet others in a specific account type.

For each of these, the job description will vary.

3. What Kinds of Financial Advisors Exist?

Although there are many nuances, we will take a look at several kinds of financial advisors which a person or a company may need.

If you want to become one, it is important that you understand the differences so that you can make an informed choice and achieve great success in your career.

i. Financial Planners

Though many people use the terms ‘financial advisor’ and ‘financial planner’ interchangeably, this is not correct. Bear in mind that ‘financial advisor’ is a broad term covering any kind of job where a person gives financial advice to a client.

On the other hand, a financial planner is a narrower task, but you would still need one. It refers to a person whose job is to make a client’s specific financial goals achievable in the best way possible.

There is a number of things people want to do with their money.

They may want to save for their children’s university education, for retirement, they may want to invest their money somewhere, buy an estate, or pay off a debt.

The role of a financial planner is to present a clear picture of the situation to the client.

They should explain, in simple and understandable terms, how the financial market functions and what the benefits and risks for the desired investments are, and also to provide an expert’s advice on how to achieve the expected goals.

Many people choose to hire special financial planners who are also fiduciaries.

This term refers to people who are both legally and ethically required to serve the client’s best interest, even if their salary is lower.

Plenty of financial planners choose to specialize in a particular field, such as retirement, estate planning, investments, or taxes.

You will read more about the specific certifications you are able to obtain as a financial advisor further in this text.

ii. Investment Advisors

First, let us make a distinction between a financial planner and an investment advisor.

Though a financial planner can also give advice on managing assets and investments, an investment advisor’s specialty is investments and they focus on that.

Here what you will do as an investment advisor:

  1. Give investment recommendations.
  2. Provide advice on how to choose the best investments.
  3. Analyze how secure or risky the client’s desired investments are.
  4. Advise the client on what kinds of securities they should invest in, e.g. mutual funds or stocks.
  5. Instruct the client about the risks and expected rate of return related to the chosen investment.
  6. Provide information about the taxes the income from an investment may require.
  7. Guide the client in making their investment tax efficient.

Most investment advisors aim at well-off clients. They may also get authorization from a client to purchase investments instead of them.

It is worth noting that not all investment advisors are fiduciaries.

Some of them are, and they are obliged to work in the client’s best interest without taking into consideration their own fees.

Those who are registered with the Securities Exchange Commission (SEC) are legally obliged to act as fiduciaries. However, there are those who have a lower standard named ‘suitability’.

They have to recommend what is generally good for the client, but they have the freedom to emphasize the investment which will bring them a higher commission.

There are two other types of investment advisors.

A ‘fee-only’ advisor earns their fee from the amount of money the investment brings to the client.

They are very well-motivated since their fee is higher if the client’s assets are bigger.

A ‘fee-based’ advisor has two sources that make up their fee: one part from the fee charged from the client and one part from the commission from the sale of stocks or securities.

iii. Financial Coaches

Financial coaches are somewhat different from financial planners.

The distinction is that the latter group helps people who already have an idea about what they want to do with their money.

On the contrary, financial coaches are there for those who are not sure which road to take in their financial endeavors.

Though financial coaches do help their clients do what is best with their money, their job has one extra component.

They first take into consideration the client’s habits, behavior, and beliefs. They estimate how these affect the client’s spending and saving money. They advise their clients accordingly.

This requires several steps to be taken.

Let us take a glimpse at them.

  1. Helping the client determine their financial goals.
  2. Understanding how they have been spending money before.
  3. Revealing bad financial habits.
  4. Establishing a budget.
  5. Instructing the client on how to follow and control the spending.

It is worth mentioning that not all financial coaches work with people who have bad spending habits.

People who want to improve their financial state and ways of spending may also choose to hire a financial coach.

They can have different reasons for needing help. For example, someone may want to become financially independent, found a start-up company, or just earn more money.

Becoming a financial coach does not require a special license or certification, though there is formal training which is designed to teach you what you need to know for this position.

iv. Credit Counselors

Credit counselors are also known as debt counselors.

The name is quite self-explanatory – they help people who are in grave debt or any other kind of poor financial situation.

The reasons may be various: unemployment, severe cut on salary, divorce, or even bad money management.

This job consists of helping a client consolidating their debts, setting a budget for paying them off and making a plan for achieving these.

One part of the job of a credit counselor may be to form a debt management plan.

This consists of contacting the client’s creditors and constructing a plan in which the counselor (or their company) will pay off the debts in monthly installments.

In this case, the client pays a certain amount of money to the credit counselor every month, who then distributes those funds to the creditors according to the plan.

Most credit counselors work as part of credit counseling agencies.

These agencies may be non-profit and work for no fee from their clients while others are for-profit and may charge high fees.

Some counselors may work independently as freelancers. In that case, they find their own clients or work with an agency as contractors.

4. What Advice Do Financial Advisors Give?

Let us take a look at some general pieces of advice a financial advisor gives to their clients:

  1. How much money should be saved?
  2. What type of mortgage should be taken?
  3. What type of insurance should be chosen?
  4. Which retirement account should be used?
  5. How can the tax situation be improved?
  6. How much money should be kept for an emergency?
  7. How much should be invested at the moment?

This list becomes narrower for those financial advisors who have a certification or license which makes them an expert in a specific field of financial planning and advising.

5. What Are the Skills of a Good Financial Advisor?

There is a wide set of skills you need to possess if you want to become a successful financial advisor. They range from business to people skills.

Read on and determine whether you are already suitable for this job or whether you should work a bit more on developing some of the skills to optimize your personality.

  1. Business and marketing knowledge This is the sole base for anyone who wants to be successful at this job. Knowledge of these fields will enable you to understand how the financial market works and what the possible strategies for a successfully accomplished task are.
  2. Analytical thinking – This is crucial for following and understanding trends. This job requires projecting the future for bonds and stocks, which in turn requires the person’s full comprehension of the process. Also, this should be applied to the client’s needs and current state. The good and bad sides should be estimated and weighed in order to take a specific action or make necessary changes.
  3. Computer skills Nowadays, a plethora of jobs are done on a computer. The job of a financial advisor belongs to this group. From using specializes programs for tracking data to making Word documents or Excel spreadsheets, solid computer knowledge is something no financial advisor can do without.
  4. Communication skills A financial advisor works directly with people. They come from various levels of education and financial states. An advisor needs to know how to approach every individual and how to establish trust. Also, they have to be able to break down complex information and to simplify technical terms so that the client understands clearly what will be done with their finances.


Financial Advisor


1. Obtain a Degree

A financial advisor is a profession that requires a bachelor’s degree at least. There are several majors which are acceptable here and these are economics, finance, business, statistics, and similar.

This profession may have a general range or a person may specialize in various fields such as insurance, estate planning, risk management, taxes, or retirement.

There is are college-level programs in financial planning or similar for those who want to become certified financial planners (CFP).

These programs have to be approved by the CFP Board of Standards to be accepted. Many universities offer them, so if this is your desired career path, you know what to look for.

If a financial advisor with a bachelor’s degree is willing or the company requires them to, they may pursue a Master of Business Administration program (MBA) and further their education in this field.

It is worth mentioning that you cannot start working as a financial advisor right after you earn your degree. You may start working in some back-end jobs until you gain some relevant experience.

Not many clients would agree to be advised by someone without any experience, as this is a very responsible position which affects people’s lives in a serious way.

2. Find an Internship

As mentioned in the previous section, you will need some experience before becoming an independent financial advisor who is worthy of people’s trust and good at the job.

If you put yourself in a client’s shoes, needing a person who will manage your own financial means, you would most probably not choose to put all your money in the hands of an inexperienced person.

So, after obtaining a university degree, the right step forward would be finding an internship.

You will step into the practice of the world of finance, learn the ropes, and get the relevant experience which will be a great advantage when the time comes for you to enter the full-time job seek.

For an easier obtaining an internship, it is highly recommendable for you to check if the college where you wish to get your degree collaborates with a financial firm that would provide internship for students.

This is certainly the simplest way, but not the only way.

Even if your university does not offer internship opportunities, you can always apply for one independently.

3. Get Licenses and Certifications

There are many certifications you may get as a financial advisor.

Specializing in one field, which is usually done after several years of work experience, will make you an expert in your chosen field and you will be able to do a better job and charge more for your services.

Getting certifications requires taking courses or specialized training, passing tests or exams.

Some areas, such as financial advisors in insurance or investment, require special licenses.

This depends on the country/state where you live.

Here are some fantastic financial certifications that you may choose from.

1. Certified Public Accountant (CPA)

This certification enables you to give advice on organizing investments and reducing taxes.

2. Certified Financial Planner (CFP)

With this certification, your job will be to assess the client’s financial portfolio and make a personalized plan.

3. Chartered Financial Consultant (ChFC)

This is similar to being a Certified Financial Planner, the difference being that here you provide advice on a special niche, such as planning for running a small business or for divorce.

4. Chartered Financial Analyst (CFA)

This certification will make you an expert in investment.

5. Chartered Investment Counselor (CIC)

This is very similar to the certification for a Chartered Financial Analyst, but it is narrower, focusing on investment counseling.

6. Financial Risk Manager (FRM)

This makes you a specialist in risk management, and your most probable job would be in a bank, in the position of a risk analyst.

7. Chartered Life Underwriter (CLU)

This certification is what insurance agents usually take. Having it makes you an expert in risk management, life insurance, and estate planning.

8. Chartered Alternative Investment Analyst (CAIA)

With this certification, you will manage alternative investments.

9. Chartered Mutual Fund Counselor (CMFC)

This will give you knowledge about the complexities of mutual funds and how to deal with them.

10. Certified Management Accountant (CMA)

Holders of this certification usually work in corporations, rather than in private accounting. They make financial decisions based on their expertise in both management and accounting.

4. Find Your First Job

The good path to follow here is to try and find an employer which offers purposeful training and, ideally, a mentor who will lead you into the world of financial planning.

Even if you had one or more internships, starting your independent work will need some starting guidance so that you learn the ropes of how they work in the company you are in.

There are many ways to find suitable companies. You may ask a professor or instructor who held your courses to recommend a place for you. You may talk with fellow students and see how they plan to get around this business.

You may talk with professional career advisors and find out which are the best companies for a beginner to apply to.

You may research online and visit some companies on your own. Or you may take a look at social media, especially LinkedIn, and search for vacant positions.


This article was aimed at giving a comprehensive set of information to anyone who is thinking of becoming a financial advisor. Let us have a short revision of what you have read about here.

Financial planning is systematizing one’s spending. A financial advisor is a person whose job is to help clients with that.

There are several types of financial advisors, and these are financial planners, investment advisors, financial coaches, and credit counselors.

A good financial advisor needs to have several skill sets, such as substantial knowledge of business and marketing, analytical thinking, solid computer skills, and communication skills.

In order to become a financial advisor, you need to obtain a college degree to get a diploma, find an internship to gain some practical insight into the field, find your first job, and get a certification or license if you wish to specialize in a particular area.

Though it may take several years to reach the desired success in this field of work, it is certainly worth the time and effort put into it.

How to Become a Financial Advisor

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