How to become a financial advisor in 6 steps

If you are good at making money and working with people, you might be interested in becoming a Financial Advisor. Of course, there are many ways to become a financial advisor, and countless certifications and specialties to pursue.

But whether you’re changing careers after years of work or just graduated from college, there’s a clear path to entry. If you’re interested, read our six steps on how to become one Financial Advisor.

If you’re looking to develop your financial consulting career after becoming an advisor, check out SmartAsset’s SmartAdvisor Platform.

Step 1: Understand what a financial advisor is

A financial advisor is a professional who gets paid to give you advice on what to do with your finances. This person may have a variety of certifications that qualify them to recommend different financial products to you and give you advice on how to get rich. Financial advisors will generally help you save more, plan for retirement, and help you invest while managing risk.

You need to start the step of becoming a financial advisor by understanding the scope of the role. Do your research on what the role entails and how it can vary depending on the background and area of ​​focus of the advisor. If you know any mentors, ask them about the position to see if it’s right for you. If you don’t know anyone, start networking. Check out our list of top advisors by state and begin to approach.

Step 2: Get an Internship and/or a Job

The next step to becoming a financial advisor depends on joining a financial consulting firm or working with a sole financial advisor. Whether it’s through an internship or getting hired, getting your foot in the door will help you through the certification process.

If you’re still in school, an internship is a great place to start. The relationships you form during an internship can directly turn into an after-school job or can be a great reference as you search for work.

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If you’re looking for a job, find a company that will pay you to get licensed. You also may not need to have any financial experience. A lot of companies are looking for people with sales experience to sell their services, so if you have that experience, talk about it. It’s likely they’ll give you the on-the-job training you need if you demonstrate good sales skills.

Step 3: Choose the type of financial advisor you want to be

Thinking there is a kind of financial advisor is like thinking there is a kind of doctor. The truth is that different advisors specialize in different areas. However, you may see two common titles among financial advisors: Investment advisor and financial planner.

Investment advisor

Registered Investment Advisors (RIAs) are experts to help you choose and manage your investments. They focus on providing you with an investment strategy to meet your risk management and goals. They are registered with the US Securities and Exchange Commission (SEC) and are required by law to act in your best interest.

Financial planner

One Certified Financial Planner (CFP) take a more comprehensive approach. While this professional offers investment advice, they will also provide services such as budgeting, retirement plan and inheritance. CFP is regulated by the Financial Industry Regulatory Authority (FINRA). If they manage clients with assets over $100 million, they may also be known as Asset Management.

Step 4: Get the necessary licenses and certifications

There are a few licenses you need to be familiar with. These licenses are issued by FINRA after passing the exams. Let’s go through some of the main ones:

• Series 3 license: You need this license to sell futures.

• 7 . series license: This license entitles you to become a stockbroker or stock trader and you must work at a FINRA member firm to obtain a license.

• Line 63 License: If you want to sell securities, you need a Series 63 License.

• Line 65 License: This is the license you must have to make recommendations and manage client investments.

• Line 66 License: Series 66 is a combination of Series 63 and Series 65. It allows you to sell securities and manage client portfolios.

In addition to these licenses, if you want to advance your career, you’ll want to become a CFP. CFP certification requires four sections, also known as the 4 E’s:

• Education: You must have a bachelor’s degree (or higher) in any discipline and complete a CFP Board Registered Program course.

• Exam: You must pass the CFP exam, which consists of 170 multiple-choice questions taken in one day with two three-hour sessions.

• Experience: You need a minimum of 6,000 hours of relevant professional financial planning experience or 4,000 hours of apprenticeship experience under the guidance of a CFP professional.

• morality: You will be asked to sign the Statement of Ethics and the CFP Board will conduct a background check.

Step 5: Build your customer base

Build relationships with customers is the key to your success. You need to make connections and motivate them with excellent service. By this part of the process, you have built your knowledge. Now is the time when you can use it to help others.

In addition to focusing on your customer base, connect with others in nearby businesses. Connect with a tax accounting or a real estate agent and refer clients to that specialist. This karma will be paid back and you can grow your business together.

Step 6: Continue your studies

If you haven’t noticed by now, being a financial advisor means you need to constantly learn. You better love learning. Regulatory requirements will make it mandatory for you to maintain your license by studying and taking additional exams.

Along with regulation, education is a great way to advance your career. For example, you can go on to become a Chartered Financial Analyst (CFA) to increase your investment analysis capabilities. This new title can then be marketed to attract customers with different needs.

Key point

If you want to know how to become a financial advisor, know that there are multiple paths. While we’ve outlined six steps for you here, the truth is that your path may not follow this exact plan. It is important that you start the road.

Tips to become a financial advisor

• If you are wondering how to become a Financial Advisor, you should start by contacting one person. Find a Financial Advisor no need to be difficult. SmartAsset’s free tool is suitable you with max three approved financial advisors who serve your area and you can interview the right counselor for you free of charge to decide which one is right for you. If you are ready to find an advisor who can help you achieve your financial goals, start right now.

• The most important qualification to look for in a financial advisor is fiduciary compliance. One fiduciary advisor legally bound to act in the best financial interests of their clients. Learn how you can demonstrate this fiduciary duty as a financial advisor.

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