Jared is a former college professor and financial advisor. He has published dozens of articles on job outlooks for various professions.
The Job Outlook for Personal Financial Advisors
The career outlook for personal financial advisers is excellent. The Bureau of Labor Statistics projects that the number of jobs will increase by 15 percent over the next decade, much faster than average. This growth is driven by a rapidly aging population, who need financial advice more than ever. Moreover, fewer employers are providing traditional retirement benefits and pensions to their workers. Those who become certified in this field have more opportunities than ever.
Demand for personal financial advisors
The number of personal financial planners is expected to increase by a healthy 27 percent over the next decade. This growth is largely driven by the aging population. As a result, more people will need advice regarding their finances as they approach retirement. People are also living longer, increasing the demand for financial services. In addition, pension funds will undergo changes and challenges in the next decade. Therefore, a good career as a personal financial advisor is a good choice.
Personal financial advisers work with a wide range of numbers. They consider a variety of variables and decide whether a particular investment is risky enough for the client. They also must be persuasive and persistent in selling their services and must be able to explain complicated financial concepts in simple terms. They also need to be able to build trust with their clients, which can be a challenge if the client is not comfortable with the decision.
According to the U.S. Bureau of Labor Statistics, the average annual salary for personal financial advisors is $124,140. These professionals have a wide range of experience, and some may have been in the business for decades. They may also live in an area where personal financial advisor salaries are higher than the average. A career in this field can bring a lucrative income, and the average annual salary is expected to increase by 15 percent by 2026.
There is also a significant amount of work involved in promoting a career as a personal financial advisor. Many advisors give seminars to generate business. Networking is another way to get business. Personal financial advisors meet with potential clients at least once a year, receive regular investment reports, and keep track of their clients' investments. A personal financial advisor also works hard to manage their clients' finances, so they must be diligent and organized to handle client issues.
Requirements to become a CFP
As a personal financial advisor, you can earn the designation of CFP if you complete the necessary coursework and meet the CFP certification requirements. The CFP (r) exam, which is given every two years, is comprised of 170 multiple-choice questions. There are two subsections: personal financial planning and portfolio management. This exam requires extensive study and time. The CFP Board recommends 250 hours of study to become a CFP, which includes pre-study, education courses, exam prep, question bank time, and practice exams.
The requirements to become a CFP personal financial advisor are demanding. Candidates must pass a rigorous examination that covers a broad spectrum of financial topics and complete a comprehensive training program. They must also have three years of work experience. A CFP must have extensive experience in direct support, supervision, teaching, and personal delivery of the personal financial planning process. While there are many different designations in the financial services industry, most may not mean much to the average investor.
Flexibility in work hours
For many people, flexibility in work hours is a top priority when it comes to their job. Working flexible hours can give you more freedom to set your own schedule and avoid the traditional 40-hour work week. Financial advisors can also be creative with their client base, building it around a certain demographic such as baby boomers or Gen Xers. The flexibility of working flexible hours is particularly beneficial for first-time financial advisors.
Being an independent financial advisor provides flexibility in working hours and location. You can choose to work from home or take your clients with you. The income you earn is variable and grows as you acquire new clients. If you reach your income goals, you can stop prospecting and concentrate on building your business. Ultimately, helping others is a great way to feel satisfied with your work, as happy clients usually refer their friends.
The U.S. Bureau of Labor Statistics (BLS) projects that the employment of personal financial advisors will increase by 4% between 2019 and 2029. This is a substantial increase, with a projected increase of 11,600 jobs. As of 2019, there were around 263,000 personal financial advisors employed in the U.S., but by 2029, the BLS expects to see 274,600 advisors working in this field. This strong growth in employment is partially attributable to the large number of baby boomers looking for retirement advice. Many will need help with retirement planning.
A bachelor's degree is a basic requirement for becoming a personal financial advisor. A major in economics, business, math, statistics, or a related field of study is helpful. Other majors, such as sociology, psychology, or political science, will provide practical knowledge in the field of personal finance. And if you're planning to work independently, it's recommended to join a small firm or network with professionals in the field.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
© 2022 Jared Lewis