Financial planners advise individuals and organizations to help meet long-term financial goals. Personal financial advisor jobs can provide high earnings and flexible work schedules.
The Bureau of Labor Statistics (BLS) reports that personal financial advisors, including financial planners, earned a median annual salary of $89,330 in 2020. Employers typically require candidates to possess bachelor’s degrees in business or finance. To advance in the field, many financial planners earn certifications in financial planning.
Read on to explore the necessary steps to become a financial advisor, including education, credentials, and experience.
Steps to Becoming a Financial Advisor
- Earn a Bachelor’s Degree: Financial planner education requirements usually include a bachelor’s degree. Some employers seek applicants with degrees in finance, accounting, or business, but many do not stipulate a specific course of study. Classes in taxes, risk management, and investments prepare students to pursue work as financial advisors. A bachelor’s degree typically takes four years to complete.
- Complete On-the-Job Training: After graduating with a bachelor’s degree, a student can pursue entry-level financial planner jobs. Most employers require recent graduates to work closely with more experienced financial advisors for a year or longer.
- Attain Licenses: Some financial planners must obtain state licenses or register with the Securities and Exchange Commission (SEC). For example, professionals who provide specific investment advice and directly buy or sell insurance policies, stocks, or bonds may need additional credentials.
- Obtain Certifications in Financial Planning: Earning a certified financial planner (CFP) credential can lead to career advancement. To receive the CFP designation, each applicant must hold a bachelor’s degree, complete a minimum of three years of relevant work experience, pass the CFP test, and agree to a professional code of ethics.
- Pursue Additional Higher Education: A financial advisor can open the door to advanced career opportunities, management positions, and higher salaries by completing a master’s degree in business administration or finance.
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Required Financial Planner Education
Becoming a financial advisor requires at least a bachelor’s degree. Some employers seek a bachelor’s in accounting, business, law, or economics. Financial planner education includes coursework in taxes, investments, and risk management.
To pursue the certified financial planner credential, each candidate needs a bachelor’s degree. Formal finance and accounting coursework prepares students for the optional CFP exam. Although not required, a master’s degree in finance, accounting, or business administration can help financial planners qualify for advanced job opportunities and higher salaries.
- Read about bachelor’s degree programs in accounting
- Read about master’s degree programs in accounting
- Read about master’s degree programs in business administration
Required Licensing and Certifications in Financial Planning
Depending on the career level and job duties, becoming a financial advisor may require a license. Certifications are optional but can lead to better job opportunities. Licensing requirements for financial planners vary by state and career.
Financial advisors who give specific types of investment advice, along with professionals who buy or sell stocks, bonds, or insurance policies, may need one or more licenses. Financial advisors who do not participate in these activities may not need to earn licensure.
Financial planners who work at large companies may need to register with the SEC. The North American Securities Administrators Association’s website provides additional details about state licensing board requirements for registered investment advisors.
Optional Degrees and Credentials
Financial planners can pursue optional degrees and certifications to demonstrate their mastery of the field and advance professionally. A master’s degree in business administration, accounting, or finance can help financial planners qualify for advanced personal financial advisor jobs with higher pay.
Optional certifications in financial planning, like the certified financial planner credential, can also improve a financial advisor’s reputation. Many employers prefer to hire financial planners with the CFP certification. Maintaining credentials typically requires professionals to complete continuing education credits.
The CFP Board delivers the certified financial planner credential. Applicants must meet education and experience requirements, pass an exam, and agree to a code of professional ethics.
Learn how to become a Certified Financial Planner
Required Experience for a Financial Planner
The financial planning field does not generally require a specific amount of experience for entry-level positions. However, recent graduates with related work experience can stand out from their competition in the job market. Some bachelor’s programs feature internships and practicums for students to develop experience before graduation.
Entry-level personal financial advisor jobs typically include on-the-job training under the supervision of more experienced advisors. Qualifying for certifications in financial planning typically requires professional experience. Becoming a CFP requires 6,000 hours of relevant professional experience or 4,000 hours of apprenticeship experience.
