A financial advisor discusses details with a young couple

What is a Financial Advisor?

A financial advisor is a professional who provides financial guidance and advice to clients as a paid service. Financial advisors typically work as business-to-consumer representatives and help plan personal finances and deal with client accounts rather than working for businesses. There are many different types of financial advisors, so the term “advisor” is a broad term used to define many different types of financial professionals.

Financial advisors are important simply because most people are too busy to do the amount of research needed to manage investment accounts. Financial advisors also help clients with estate planning, accounts for children, income tax preparation, and retirement planning.

Most financial advisors work for financial services firms that specialize in certain types of finance. However, there are many common tasks that all financial advisors perform, regardless of specialization. For instance, financial advisors usually meet with clients in person or via digital communication to discuss financial goals and explain the different kinds of services that their business provides. They also educate their clients about investment options and answer any and all questions the client might have.

Many financial advisors also recommend different investment options and inform clients of investment risks. They may manage investments or accounts on the client’s behalf. Most of these tasks are planning services, but financial advisors can also manage accounts and monitor account performances. They also help clients manage finances for life changes like having children or getting married. Additionally, when a financial advisor is managing investment accounts, they will typically research investment opportunities for the clients and make recommendations to the client as necessary.

Essentially, a financial planner has three main tasks: to determine the client’s goals, to help the client determine which direction to take with their finances, and to manage the client’s accounts once the decisions have been made.

The job outlook for financial advisors is currently very good. While the total job growth across all occupations over the next 10 years sits around 11%, jobs for financial advisors are expected to grow by 27% by 2022. This is primarily because the baby boomer generation is aging, creating more need for financial planning professions. If you want to become a financial planner, consider getting a bachelor’s degree in business, economics, or finance. Keep in mind that financial advising is all about numbers, so if math isn’t your thing, consider finding a different career option!

Last Updated: April 19, 2016