Why financial planning is a great career


With worldwide industry disruption and technological advances occurring at a rapid advance, figuring out your career prospects can seem a little daunting, particularly in the finance sector.

Robo advice and automated investing platforms are increasingly popular which begs the question: what is the future of financial planners and is it a good career option?

A recent survey conducted by Investopedia and the US Financial Planning Association® (FPA®) reports that investors require both high-tech (automated platforms) and high touch (financial advisors) of advice to satisfy their complex financial needs.

Here’s why we think financial planning is a great career.

In high demand: the future’s looking bright

In 2011, Danny Sarch, Wall Street recruiter and Forbes contributor, concluded that financial advisory careers have remained secure and increasingly relevant:

From the heights of the most frenzied bull markets, to the depths of the worst bear markets even as other professionals within the same industry are laid off, financial advisors today who are compliance clean, who generate a substantive amount of revenue, have the most secure job in the world,” he said, speaking with Forbes Magazine.

Sarch cited the increase of Baby Boomers approaching retirement and the fact that the average financial advisor is around 50 years old as the reason financial planning is a golden career for young professionals.

But is this still the case in 2017? Well, apparently so.

According to a CareerCast report, financial advisors are one of the toughest jobs to fill and there aren’t enough to meet current demand. As reported by CNBC, there are about 76,000 certified financial planners (CFPs) in the US now, but there’s room for more.

The CareerCast study reported that qualified Financial Advisors have no shortage of opportunities in the coming years and the Bureau of Labour Statistics is reporting a growth projection of 30% by 2024, forecasting demand from employers that might be difficult to keep pace with.

Why financial planning?

The benefits of financial planning go well beyond monetary gain.

The role of a financial planner isn’t simply about investing money. It’s about guiding your clients to achieve their financial goals and dreams through personalised strategies and advice.

Financial planners help their clients by helping them:

  • reduce debt
  • increase savings
  • develop firm strategies to achieve financial security and freedom
  • minimise tax
  • develop wealth management and budgeting techniques, and
  • save and plan for retirement.

As a professional career, it offers the chance for intellectual stimulation, independence and financial reward as well as helping secure the financial future of your clients.

The Financial Planning Association of Australia (FPAAA) cites a great salary and the flexibility and freedom to work how you want – whether that’s with a small or large business, or setting up your own practice.

Financial planning is also a great global career – working overseas is a realistic prospect which is likely to attract millennials and young professionals.

Apart from the chance to make decent money and take your career overseas, financial planning is a valued profession that helps you empower others to make informed financial choices (ones that you will be able to apply to your own life and finances too).

What you need to know about financial planning

If you’re keen to launch into a financial planning career, here’s what you need to know:

  • Education requirements may differ around the world but as a general rule, you’ll need a Bachelor degree in any discipline (preferably related to finance, commerce or economics).
  • Expect to start with an administrative, entry-level role at the outset (as with most careers). Don’t fret about doing some admin tasks or making some coffees here and there – you’ll spend most of your time learning the ropes of a financial planning business so you’re ready to move into an advisory role yourself.
  • According to E-Financial Careers, after about 1 year, a motivated planner can expect to move into a ‘paraplanning’ role which typically lasts up to two years. This is where you get exposure to the rules and regulations governing financial planning and the basics of strategy and planning. After successfully navigating this period, you should be ready to become a fully fledged financial adviser.
  • To enhance your skill set and recognition abroad, you can become a CERTIFIED FINANCIAL PLANNER® professional through the CFP® Certification Program offered by the FPAAA. CFP® certification is the highest recognised financial planning designation in the world, allowing you to work in 26 countries and join a growing community of over 5,500 CFP® professionals in Australia and 160,000 globally. According to the FPAAA, CFP professionals earn up to $65,000 p.a. more than other financial planners.
  • The US Bureau of Labour Statistics reports an average median salary of $89,160 for financial planners. In Australia, a Robert Walters survey shows senior financial planners on average earn between $110,000 and $150,000, while less experienced planners’ salaries are in the range of $75,000 – $100,000.
  • Some financial planners prefer to set up their own practice and work for themselves. Financial planners who run their own business will manage staff, their own clients as well as the day-to-day operations of the business. It pays to think about whether you want to run your own show or work as an employee advisor.

Skills required to make it

Expertise and knowledge in the area of wealth management, finance, economics and investment is a given.

But it’s not just about the numbers – if you’re in business, you need to know how to market, sell, network and connect. As a financial planner you’ll spend your time growing your client list so you’ll need to be actively engaged on social media platforms such as Twitter and to stay on top of industry trends, join specialist groups on LinkedIn and attend events and seminars.

Greg Cook, CEO of Eureka Whittaker Macnaught believes that soft skills such as how to build rapport with clients, how to perform well at initial interviews and how to manage delicate situations are just as important as being able to give sound financial advice.

Above all, remember that this is a relationship of trust. Landing and keeping clients depends on your ability to step into their lives, tap into their dreams, desires and pain points and show up consistently as the advisor they can rely on.

Conclusion: Where high touch meets high tech

Don’t be scared off by the ‘robo advice’ trend and the Fintech movement. There is a growing opportunity for automated investing platforms and financial planners/advisors to work together.

The Investopedia and FPA report notes that while automated investing platforms can satisfy the need for people to address their before and after-tax investments, no algorithm exists that can prudently assess the many areas of a person’s financial life and make the necessary strategic decisions relating to retirement planning, estate planning, tax planning, health care planning, elder care planning (as well as the many other personal financial areas most people face).

If you want to be a financial planner, go and meet one and see what they do from day to day. Ask questions and observe how they offer value to clients. Research the current regulatory environment and tech developments to make sure you make the right decision.

Remember: in a turbulent financial world, people need personable and committed advisors more than ever. Financial firms also need skilled advisors to enhance their automated investing services and give clients the ‘high touch’ engagement and connection they crave.

Chris Wrightson. Founder and CEO at Centurion Market Makers, the industry experts in the sale, acquisition and management of financial planning firms. If you’re planning on selling your firm in 2017, we’d love you to call us for a confidential discussion, or continue browsing our website for more tips, tools and info on the steps to take when buying or selling your financial planning firm.

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