Looking for a great career? Why not consider going into the financial services industry? If you like a challenge, then this field might be the one for you. Working in this sector can also be very rewarding—both on a personal level and from a financial perspective. In fact, depending on the position and your years of experience, the earning potential can be unlimited. But how do you get started?
Learn more about how to become a financial advisor, choosing where to work, and some of the top companies in the financial sector.
- Financial advisors provide financial advice to clients.
- There are a number of places to work as an advisor including banks, brokerage firms, insurance companies, and wealth management firms.
- Demand for financial advisors is expected to rise between 2020 and 2030 due to an aging population that will require more financial planning services.
- You may need some experience if you decide to branch out on your own as an independent advisor.
What Is a Financial Advisor?
Financial advisors provide their clients with financial advice for different services whether that entails how to manage their investments, how to manage and plan their estates, or how to prepare for their taxes.
The term financial advisor tends to be fairly obscure. That's because different financial professionals fall into this broad category including bankers, estate planners, insurance agents, investment managers, stockbrokers, and tax professionals. As such, you can find them working in any number of financial companies from banks to brokerage firms and insurance companies, and even wealth management firms.
A financial advisor's first duty is to their client. That means they must have the best interests of their clients before anything else. As such, they are held to certain standards and must follow ethical guidelines.
Your first duty as a financial advisor is to serve your clients' best interests.
Most financial advisors have an undergraduate degree in accounting, finance, economics, math, or business. Some may have a graduate degree and may also take specific courses if they choose to specialize in a certain discipline such as estate planning, risk management, tax preparation, or portfolio management. Some advisors may also seek out special designations including certified financial planner (CFP), certified public accountant (CPA), among others.
Salary and Job Outlook
According to the U.S. Bureau of Labor Statistics (BLS), the median annual salary for personal financial advisors was $89,330 in 2020. The top 10% in this field earned more than $208,000, while the lowest 10% earned less than $44,100. Financial advisors are also likely to earn bonuses, which are not included in these figures.
The BLS reported that there were 275,200 jobs in this field in 2020. Prospects for employment in the field are positive, with an expected change in need for financial advisors to be around 5% for the 10-year period between 2020 to 2030. This growth is primarily due to an aging population that will require more financial planning services.
So where should you work? If you're looking for a good place to start, consider joining a major firm. The best company reflects your personal preferences. Although the financial compensation may not be as high, retail banks are also great places to get a good start on your career as a financial advisor.
A self-starter who likes having the independence to call his or her own shots may fit best at a place like Raymond James (RJF), which offers advisors several types of affiliation. Or perhaps you're looking for the advantages that come with working at one of the big-name firms like Fidelity Investments or Charles Schwab (SCHW).
If you want to be free to choose when and how you work, you may have some success working independently. But keep in mind, accomplishing this takes some time. This option may be better after you've amassed a few years of experience under your belt. That's because you'll need to build up your reputation as well as your client base.
Questions to Ask Yourself
How do you choose? Lots of research, interviews with employees, and some soul-searching. Ask yourself:
- What type of environment do you prefer—casual, or corporate?
- Do you like flying solo or do you prefer or the hustle and bustle of a big firm?
- Where do you want to be located geographically?
- What type of clients are you interested in serving?
- What type of work would you like to do?
- What type of services will you offer?
The Fortune List
Each year, Fortune puts out its list of the 100 Best Companies to Work For—a well-regarded survey that looks at factors like the credibility of a firm's management, employee job satisfaction, and workforce camaraderie. Many financial services firms, investment companies, and insurance companies make the grade and may offer ideas about the best places for financial advisors to work.
The following are the finance sector's top five companies listed in order of their rank on the 2021 list:
- Capital One Financial in 9th place
- Edward Jones in 20th place
- Bank of America in 22nd place
- Nationwide in 25th place
- Baird in 32nd place
The Bottom Line
Job seekers looking for a financial advisor position have lots of factors to sift through. Remember that many of the large financial services firms have offices nationwide and that locations may offer employees a different work environment and benefits. Make sure you do your homework. Speak with current and, if possible, former employees about their experiences. Investigate work practices and research any ethical violations.
Additionally, do some background research on fee structures and corporate culture. In the end, what is the best company for a financial advisor? It's the one that matches up with your skill set and personal preferences.