If you’re considering a career as a financial advisor, you may be in for such a treat!
If you are someone who has a strong passion for helping other people and for finance, this is the perfect career path for you.
However, just like any other career, there are both pros and cons to becoming a financial advisor.
You can carefully weigh them to help you make the best decision for yourself.
Table of Contents
- Pros of Being a Financial Advisor
- Cons of Being a Financial Advisor
- 14 Pros and Cons of Being a Financial Advisor – Summary Table
- Should You Become a Financial Advisor?
Pros of Being a Financial Advisor
Here are some pros of becoming a financial advisor.
1. Extensive Earning Potential
One of the most interesting pros on the entire list is the fact that you have the opportunity to earn unlimited income.
What you put into it, is what you will get out.
Typically, financial advisors on average make $90,530 annually.
But, this is generally a starting salary, with the potential to earn much more.
Your earning potential has a lot to do with the number of clients you book and being able to properly manage your assets.
There are also financial advisors that charge by the hour.
In this case, your income will be significantly higher as the demand for your services will increase.
For example, it is common for financial advisors to charge between $150-$200 an hour for their services.
If you are considering becoming a financial advisor, you may be excited to know that you can create any schedule you’d like.
This means that you don’t have to commit to the usual 9 to 5 schedule if you don’t want.
While this is good news for most people, you must also affix your schedule so that it fits in with the times you need it the most.
For example, if you are more productive at 6 a.m., then make sure that you commit to a morning schedule that fits your lifestyle.
Furthermore, you’ll need to set aside time to speak with your clients during your normal business hours.
Also, you may find that you don’t have as much flexibility just starting out.
But you can expect this to improve if you stick with it.
3. Make a Difference in People’s Lives
It is entirely rewarding to become a financial advisor for several reasons, another one being that you have the ability to make a difference in people’s lives.
Financial advisors are capable of helping their clients expand their business and plan for the future.
They are many times considered to be superheros.
Their main goal is to provide valuable information that will help improve their client’s financial situations.
4. Cheap Startup Costs
As a financial advisor, you will not have to pay too much out of pocket to get your business up and running.
But, there will be fees you must pay related to licensing and other expenses.
However, these costs are nothing near the funding that is required to start up other types of businesses.
For instance, no office space is needed.
Instead, you can set up a home office right in the comfort of your own home.
5. Growing Industry
Between 2016 and 2026, there should be an expected growth of 15% for financial advisor opportunities.
What this means is that you can expect over 40,000 more job opportunities to become available by 2026.
This increase in job opportunities is caused by baby boomers who will be preparing to plan for their retirement.
Additionally, individual retirement accounts have been taking the place of traditional retirement plans.
This means that more individuals will rely on the assistance of financial advisors.
6. Organize Your own Finances
Being a financial advisor means that you will be spending an ample amount of time organizing and helping others in regards to their financial situations.
This is a great opportunity to also organize your own finances.
The benefit of becoming a financial advisor means that not only will you learn about the financial industry for your clients, but you will be applying that same information to your own situation.
7. Work With a Wide Range of Clients
A financial advisor’s job never gets old.
You will have the chance to work with clients from various backgrounds and industries.
Working independently means that you are not limited to any single industry or client.
Your job will never get boring.
Either way, you have the chance to do what you want, whether that’s working in a certain niche or with a variety of clients.
Cons of Being a Financial Advisor
Don’t jump the gun just yet.
With every pro comes a list of cons.
Check out the following list of cons to gain a better understanding of what to expect as a financial advisor:
High levels of stress are also associated with being a financial advisor.
This is because there are a lot of ups and downs you’d have to deal with within the financial market.
You will be a jack of all trades when working with different clients.
Your clients can also put additional stress on you.
Additionally, you may end up competing with other financial advisors.
At most, you will have to learn how to deal with it since it’s a big part of the job.
Furthermore, if you fail to manage your stress properly, you can face many issues in the long run such as depression, anxiety, poor physical health, and lower productivity.
2. Excessive Education
It is important that you get a hold of the basics in order to make it far as a financial advisor.
The basics are a must.
However, it’s more than just the basics that you must learn.
Since the financial market is constantly expanding, you’ll have to stay on top of your education.
In order to have the opportunity to earn a decent living, you will have to learn how to get the results your clients expect.
3. Follow Required Regulations
Once you have become a licensed financial advisor, you are not going to magically start receiving clients the next day.
Before you can begin work as a financial advisor, you must meet additional regulations per your state.
For example, a license is required but your state may also require you to have a college degree.
You may also only be able to obtain a license if it was sponsored by a firm.
In order to work independently, you may first work for a company.
4. Must be Disciplined
In order to succeed in the world of financial advisor, you must be self-displined and remain consistent.
This is the only way you will get the results you are looking for.
You have to go out there and find your own clients.
If you aren’t ambitious enough to do this, you will have a hard time making it as a financial advisor.
But, if you’re willing to challenge yourself, you will go far in this industry.
5. Upfront Work is Mandatory
A couple of perks of working as a financial advisor are having a flexible schedule and making a lot of money.
However, you have to establish yourself first.
You must be willing to put in long hours, at least 60 hours every week.
This can go on for years before it starts to settle down.
In order to get the results you want, you have to be willing to do the hard work upfront.
6. Marketing is Required
As mentioned earlier, you must go out and find your own clients.
This means that you have to create a solid marketing plan and follow it.
This is the best way to establish a good client base.
In the beginning, you will be faced with many challenges, but it takes a strong marketing strategy to get to where you want to be.
7. Not for Introverts
If you’re an introvert, you probably won’t make it very far as a financial advisor.
This is the type of career that involves and requires constant interaction with others.
This, for many, can make it less appealing, especially if you’re an introvert.
However, if you are the opposite, and love helping people, this will make a perfect career choice for you.
14 Pros and Cons of Being a Financial Advisor – Summary Table
|Pros of Being a Financial Advisor||Cons of Being a Financial Advisor|
|1. Extensive Earning Potential||1. Stressful|
|2. Flexibility||2. Excessive Education|
|3. Make a Difference in People’s Lives||3. Follow Required Regulations|
|4. Cheap Startup Costs||4. Must be Disciplined|
|5. Growing Industry||5. Upfront Work is Mandatory|
|6. Organize Your own Finances||6. Marketing is Required|
|7. Work With a Wide Range of Clients||7. Not for Introverts|
Should You Become a Financial Advisor?
By all means, making the decision to become a financial advisor is not easy.
The path to get to where you want to be is going to be long and tough.
You will need to commit yourself to long hours and consistent education.
Don’t forget that you must also take the investment of money and time into consideration before you can even grow your business as you’d like.
Marketing may be challenging for you, but it’s also required.
Make sure that this is something you truly want to do before you make the jump.
However, if you choose not to give up, you will have the opportunity to experience unlimited earning potential, flexibility, and an all-around rewarding career.