There are pros and cons to becoming a financial advisor. Cons include long hours and potential challenges in growing your business. However, the pros seem to outweigh the cons in this field. This is especially true if you are ambitious, passionate about personal finance, and want to make really good money.
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According to Indeed, the average annual salary of a financial advisor in the United States is $72,574. However, this is just an average, and you can potentially earn more. The maximum annual salary for a financial advisor is $146,228, according to Indeed. If you can earn a six-figure income per year as a financial advisor, you might be wondering how you can become one.
The path to becoming a financial advisor is not an easy one, but if you have passion and determination, you can pursue this field and potentially earn a great income.
Typically requires education and a bachelor's degree in finance
There are certain education and certification requirements to become a financial advisor.
“The requirements to become a financial advisor vary widely from country to country, but most advisors have a background in finance, economics or business,” says Eric Cloke, CFP, president of Cloke Capital.
“The most common educational requirement to become a financial advisor is a bachelor's degree in finance or a similar field.”
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Experience in the financial industry
Although not required, it is highly valuable to gain experience across the financial industry before beginning your career as a financial advisor – this will give you a competitive advantage.
“Most financial advisors start their careers as investment bankers or accountants,” says Croke, “and as a financial advisor, you need to be familiar with a variety of federal and state laws.”
Take required exams and continuing education courses
To become a financial advisor, you'll need to pass some important exams and get the necessary licenses to practice in your state. Generally, you'll need the following licenses:
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Series 6 License
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Series 7 License
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Series 63 License
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Series 65 License
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Series 3 License
“Depending on your location, you may be required to take continuing education courses,” Cloke said.
Find an internship at a financial advisory firm
Professional networks and hands-on learning are essential to success in any career, so if you can afford it, consider an internship at a financial advisory firm to build relationships with established financial professionals.
“Banks, insurance companies and investment advisory firms often have internship opportunities,” says Croke. “Internships are a great way to find out if the profession is right for you and if you're truly interested in the field.”
We can work for consumers and businesses
Once you've passed all of the exams and are licensed in your state to practice as a financial advisor, you'll need to decide what type of financial advisor you want to be. For example, will you serve consumers as a sole proprietor or work for a large corporation?
“Many people think of financial advisors as self-employed individuals who work with individuals and families, but that's just one career option,” says Cloke. “You can also work for a large firm, analyzing market data, crunching numbers and developing solid financial strategies for your employer.”
If you want to make six figures, you need control.
If you want to earn a high salary as a financial advisor, it's important to have complete control over your career. You'll need tenacity, flexibility, and the ability to handle stress without getting overwhelmed.
“To be a successful financial advisor with a six-figure income, you need a sense of control,” Cloke says. “People who make six figures know they are the captain of their own ship. This is especially true for financial advisors because they typically don't have a boss in the traditional sense. They set their own work hours and vacation schedules.”
Double down on self-discipline
One of the benefits of being a self-employed financial advisor is that you can set your own hours and schedule, but this can be dangerous if you’re not extremely disciplined.
“Having a career with a lot of freedom is great, but it can also be a drawback for people who lack self-discipline,” says Croke. “High-earning financial advisors are self-motivated. They understand that no one else is going to bail them out, and if they want to earn a high salary, they need to have a plan and get to work.”
Or consider becoming a financial planner
You may be wondering, “What is the difference between a financial advisor and a financial planner?”, which may lead to the question, “Which career path is better for me?”
To answer the first question, financial advisors assist clients with a wide range of financial services, including comprehensive financial planning, tax guidance, investment management, budgeting, and insurance strategies.
Financial planners have a more limited scope of work. They only cover the comprehensive financial planning part, but they still do a lot of work. They specialize in analyzing your spending habits, developing an investment strategy (both short-term and long-term), and creating a plan to help you reach your retirement goals.
Jay Zigmont, PhD, MBA, a certified financial planner at Childfree Wealth, suggested considering becoming a certified financial planner. These professionals can earn even more than financial advisors: According to the CFP Board, those with 20 years or more experience in the field can earn an average of $250,000 per year.
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This article originally appeared on GOBankingRates.com: Financial advisors can earn six figures a year: How to become a financial advisor
