How to become a financial planner

Financial planners, sometimes referred to as personal financial advisors , help people manage their finances so that they can meet their money-related goals. Let’s look at this career, and what it takes to work in financial planning.

Financial planners help clients take steps to meet financial needs while growing wealth and selecting investments. Some people hire a planner because they need assistance with specific tasks, such as saving for their children’s college education or funding and managing retirement accounts.

This career requires both finance-related skills and softer skills to better client relationships while simultaneously helping them understand how to manage their money.

Before we dive into skills and education needed for this profession, let’s define how a financial advisor is different from a planner. While both roles fall under the broader category of professions in the finance field, there’s a slight difference in nomenclature. A financial advisor  usually provides help with short-term issues, while a planner focuses more on a long-term plan. These can often be used interchangeably and may be multiple people or a single professional. 

Here are some of the key skills to possess in the field of financial planning:

• Analytical — Planners need to analyze financial markets and asset-buying opportunities to give clients good investment advice. They need the ability to interpret each customer’s needs and select investment portfolios that best match their goals, risk tolerance and budget.
• Communication — Working directly with clients, meeting with them face-to-face, over the phone, via email and text, or virtually is part of this role. Communication skills are essential, including the need to express clearly and explain complex financial plans simply. Listening to clients and asking questions is important to get information to define their requirements and goals.
• Interpersonal — It's important to be affable and trustworthy. A big part of the job is interacting with clients, who are more likely to continue working with someone if they feel a personal connection.
• Problem-solving — Many clients will not have straightforward financial situations, or they will experience unexpected challenges that could throw their saving and investment plans into disarray. When this happens, It's the job of a financial planner to find solutions that allow them to adapt without damaging their budget or delaying their goals.
• Research — Personal financial advisors need to constantly research investment opportunities and financial markets.Clients rely on these insights and advice about investments. Since economic factors and financial markets are constantly in flux, the research aspect of the job will be ongoing.
• Math — Crunching numbers is an important aspect of this profession, along with a strong grasp of math principles to help assess the performance of clients’ portfolios.  
• Sales — Similar to the importance of communication and interpersonal skills, sales skills are an important part of this role. A financial advisor not only has to sell their services to a client, but they might also sell packaged securities.

Developing these abilities through a combination of education and job experience is necessary for this job. The typical career path starts with a college degree and then continues in finding opportunities to gain real-world understanding along the way.

A strong educational background is necessary since decisions will directly impact the finances of clients. A lack of solid financial knowledge can adversely affect clients’ lives, plans and goals.

Personal financial advisors typically need at least a bachelor’s degree  in areas like finance, math or business, according to the U.S. Bureau of Labor Statistics (BLS). It can be helpful to have taken classes in areas like investments, financial planning and risk management. Other undergraduate options can include a bachelor’s in accounting or finance. These programs provide a solid, but broad, knowledge base to build a career.

Those wishing to enhance their career may choose to pursue a master’s degree or a professional industry certificate or certification. A master’s degree can help provide the educational foundation to pursue a role as a financial manager and may also help to attract new clients. 

One example is a master’s in business administration (MBA). MBAs are valuable in financial planning because they have a broader scope  than a master’s in finance. This additional knowledge can be helpful because there are clients with a wide range of financial goals and needs. Some clients will have business interests, property and other assets that are beyond the scope of what  is taught in a finance degree program. 

Another educational option is a graduate certificate in finance. This is a shorter graduate-level program that focuses on specific aspects useful in financial planning, such as budget analysis, risk management and how to spot investment opportunities. Such graduate certificates are different from MBAs because they typically take less time and focus on developing specific skills and knowledge. An MBA program takes longer but provides a broader overview of fundamental business concepts. 

However, for those focused on time, gaining a bachelor’s degree in business with a certificate in financial planning is an option. A solid base in both general business concepts and financial knowledge and skills can help to professionally manage clients and their finances.

Additionally, professionals may opt for an industry certification instead of, or in addition to, a master’s degree. Certification can be a selling point for clients and is necessary to become a Certified Financial Planner (CFP^®). The CFP certification is offered by the Certified Financial Planner Board of Standards and can be earned only after graduating with a bachelor’s degree, passing an exam and agreeing to the CFP Board’s code of ethics. 

BLS suggests that on-the-job experience is vital for new financial planners. Some aspects of the job, such as interacting with clients and building relationships, can be learned only through experience.

Since mistakes can be disastrous for clients’ finances, this cannot be learned by trial and error. Instead, they develop experience through internships, volunteer opportunities and on-the-job training.

It’s possible to gain an internship during undergraduate or graduate-level studies. This will add an element of real-world experience to an education.

The next step could be to volunteer. Financial planning volunteers , can provide pro bono financial advice to clients. This allows them to put classroom skills to use and to develop communication and relationship-building abilities. Such opportunities are typically only available after you have earned educational qualifications.

Finally, many financial planners start their careers by shadowing more experienced professionals. In an entry-level role, there may be opportuniries to assist with research and analysis and perform specific tasks if directed to do so by a senior planner. BLS estimates that this shadowing term can last more than a year.

This real-world experience, combined with a business degree, helps develop a solid foundation from which to launch acareer. 

Demand for personal financial advisors is projected to grow 13% from 2022 to 2032 , according to BLS. That translates to an estimated 25,600 job openings each year.

Robo-advisors, which use algorithms to automatically suggest investments for clients, are becoming popular because of their relatively low cost. However, their usefulness is limited, and people will still seek out in-person services for more-complex financial matters, such as handling real estate, life insurance policies and taxes.

Financial planning can also pay well with the right mix of education, skills and opportunity. As of May 2023, these professionals earned an annual wage between $48,730 and $239,200 , with a median of $99,580, according to BLS.

A majority of these professionals work for investing or financial services companies. However, 20% are self-employed  and others work for insurance providers and credit counseling services.

Financial planners interact directly with people and can find the ability to make a positive impact on their clients’ finances rewarding. However, both education and real-world experience are necessary to be successful in this career.

Salary ranges are not specific to students or graduates of University of Phoenix. Actual outcomes vary based on multiple factors, including prior work experience, geographic location and other factors specific to the individual. University of Phoenix does not guarantee employment, salary level or career advancement. BLS data is geographically based. Information for a specific state/city can be researched on the BLS website.

BLS Occupational Employment Projections, 2022-2032 is published by the U.S. Bureau of Labor Statistics. This data reflects BLS’ projections of national (not local) conditions. These data points are not specific to University of Phoenix students or graduates.

If you’re interested in pursuing a career as a financial planner or personal financial advisor, University of Phoenix  offers online degrees and programs in business and accounting, including certificates in financial planning:

• Bachelor of Science in Business 
• Bachelor of Science in Accounting 
• Bachelor of Science in Finance and Technology 
• Graduate Finance Certificate 
• Graduate Accounting Certificate 

Contact University of Phoenix for more information.