You have a knack for finance and want to guide people through their money problems. Excellent, as you already have what it takes to be a financial advisor. These advisors are those who offer strategies and tips to help better everyone’s financial advisors. However, the career isn’t exactly as easy as telling someone how to budget. In this post, we’ll be covering what there is to know about being a financial advisor.
What is a Financial Advisor?
Before we get into skills to learn to get a good job and what you need to know about the position, it’s important that you understand what a financial advisor actually is. In truth, it’s a rather generic term used in the industry. They’re professionals, but there’s no set niche for a financial advisor. This kind of advisor can be a stockbroker, tax agent, investment manager, or even an insurance agent. You can choose to either provide general information or choose a specific niche to specialise in.
Be Prepared for Any Situation
While your topic may not change, the clients and their situation will differ. A reputable financial advisor can handle any situation. Let’s say you have a client that wants to save more money on their taxes. However, they’re not exactly sure how to go about it or what they can deduct. As their financial advisor, you can counsel them on how taxes work and offer suggestions.
One strategy you can suggest is to encourage them to co-sign on a student loan. Co-signing is when someone agrees to fulfil the responsibility of paying the monthly instalments in the event the primary borrower is unable to. But it’s not exactly a one-sided benefit; co-signers are able to deduct almost $3000 on their taxes. A common question you may hear is “how does co-signing a student loan affect my credit?” Make sure to tell them the risks involved with co-signing. If the primary borrower misses too many payments, both credits take a hit.
Be Willing to Socialise
As an advisor, you’re going to be meeting different personalities. You’ll be talking to many people, so being able to effectively network and socialise is an absolute must. If you’re someone who’s not very sociable and prefers to work alone, then this job isn’t for you.
Have an Amazing Income Potential
What a lot of new advisors aren’t aware of is the amazing income potential. Financial advisors can earn money depending on how many clients they’re willing to take on and the amount of hours you choose to work. There are two different pay structures financial advisors use: fee-based or commission-based. There are those who even use both structures to maximise their earnings.
It’s a Very Demanding Job
Depending on how you go about it, advising people on their finances can be a stressful job. In fact, you’ll go from offering advice to soothing a client’s anxiety. This isn’t exactly a bad thing as the economy is constantly changing and people are becoming more uncertain about their own financial stability. If this is your full-time position, be sure to create a comprehensive schedule and have work-life balance.