While a career as a financial adviser is rewarding, it has the same drawbacks as any other job.
Financial Advisor Career: Overview
Taking on the role of financial adviser offers a variety of opportunities that are not widely available in many career areas. In addition to providing valuable advice to clients, successful financial advisors have virtually unlimited revenue potential, flexibility in work schedules, and control of their practices.
The number of financial advisers in the United States, according to the Bureau of Labor Statistics.
Careers also have many drawbacks over severity and duration. Among the most notable disadvantages are the industry’s stressful environment, the length of time it takes to build a customer base, and the ongoing need to meet regulatory requirements.
- The growth rate of financial advisors by 2024 is much higher than the average job outlook.
- Benefits of becoming an advisor include unlimited income potential, flexible work schedules, and the ability to coordinate your practice.
- Among the drawbacks are high stress, the effort and time required to build a customer base, and the ongoing need to meet regulatory requirements.
Financial Advisor Career Advantages
The benefits of a career as a financial adviser go far beyond compensation. The projected growth rate for financial advisors from 2016 to 2024 is 15%, which is significantly higher than the average job outlook (7%), according to the Bureau of Labor Statistics. Here are some of the key benefits of becoming a financial adviser: :
Providing meaningful advice
Providing meaningful advice is often not the reason financial advisors start their careers in the industry, but this aspect of the job is generally the most rewarding. Consumers are often overwhelmed and confused about which investment or insurance policy is right for them. The primary role of a financial adviser is to educate clients to make the right decisions. The success of a client’s financial life is often comparable to the success of a client’s financial adviser.
Unlimited income potential
For most financial advisers, there is no limit to their potential income. Financial advisors are either fee-based, fee-based, or a combination of both. This means that your revenue is based on the amount of new business or recurring revenue that is created each year. Although the wage system is different, advisors can earn as much or as little income as possible.
Work schedule flexibility
Finding a balance between work and personal life can be a challenge when starting a new career, and financial advisors are no exception. However, once an advisor establishes a customer base, that career helps with flexibility in working hours. Experienced advisors have the advantage of scheduling client meetings around a personal calendar, and over time they have the opportunity to work less than 40 hours a week.
Creativity in practice structure
Financial advisors have the opportunity to be creative in building their customer base. Some focus on serving the Baby Boomers, while others are for millennials only. Generation X is another group to serve. Advisors can also decide to specialize in a particular type of client, such as a doctor, lawyer, or entrepreneur.
You can also provide your clients with a wide range of products and services, including financial planning, investment management, life or disability insurance, retirement plans, and more to give them complete control over their operations.
Financial Advisor Career Disadvantages
While the list of pros and cons associated with working as a financial adviser is long, there are many disadvantages to consider.
High stress industry
Financial advisors can experience a great deal of stress when starting this career. The financial services industry is cyclical and intertwined with domestic and global market performance. If the economy is performing poorly, the client will contact the advisor first. Financial advisors constantly manage client emotions based on market downturns, which can lead to high levels of stress over time.
Starting a career as a financial adviser is not an easy task. Many financial services companies have sales quotas to meet each month. This means that advisors are constantly in need of new prospects until a strong customer base is established. Many advisors who leave the financial services industry talk about the stress caused by the amount of time and money spent creating and maintaining a profitable prospecting system. Creating a business book is the most challenging aspect of a career for a new advisor with a small personal network.
Regulatory and compliance requirements
The financial adviser must be licensed to provide advice to clients and sell products. The process of obtaining these licenses can be time consuming. In addition, advisors must complete a certain number of continuing education courses each year to keep their licenses in good condition and must be insured for errors and omissions throughout their careers. Addressing these regulatory requirements can help protect clients from fraud, but can be a costly and time-consuming task for financial advisers.