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Choosing Financial Advisor vs. Financial Analyst for Your Career


When considering a career path in the financial sector, two common options often come to mind: becoming a financial advisor or a financial analyst. Both roles offer unique opportunities and challenges, appealing to individuals with different skill sets and career aspirations. While financial advisors primarily focus on providing personalized financial guidance to individuals and families, financial analysts study financial data, conduct research and make recommendations to organizations or clients.

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What Is a Financial Advisor?

A financial advisor is a professional equipped with the knowledge and skills to guide clients in financial planning and wealth management. They play an important role in helping individuals achieve their financial goals, whether it’s growing wealth, planning for retirement or saving for a child’s education.

The responsibilities of a financial advisor are wide-ranging, and tailored to address the unique financial situation of each client. Advisors might assist clients in developing detailed financial plans that encompass retirement planning, advising on education savings, implementing tax strategies to enhance financial efficiency and estate planning to ensure assets are distributed according to the client’s wishes.

They also can offer guidance on budgeting, debt management and evaluating the right insurance coverage to protect against unforeseen risks.

What Is a Financial Analyst?

Financial analysts can help businesses and individuals optimize their financial strategies. They often work in corporate finance departments, investment banks, asset management firms, hedge funds, consulting firms, insurance companies, and government agencies, among other places.

These financial experts analyze financial data, market trends and economic conditions to offer specific insight and recommendations about investments, budgeting and financial planning.

Financial analysts often apply their expertise to optimize investment portfolios, scrutinize potential investments and perform rigorous due diligence on prospective financial engagements.

They must be able to understand financial statements and use advanced analytical tools as they work with both historic and current financial data, and create financial models to forecast economic outcomes.

Financial Advisor vs. Financial Analyst

A financial analyst examines market data while working late one night.

While there are clear differences between both financial experts, there are also some notable similarities that can overlap, especially if you’re considering a career in either profession.


Both financial advisors and financial analysts have comparable levels of financial expertise. They generally possess a strong foundation in financial principles, which include understanding market trends, investment strategies and economic factors. Typically, both have educational backgrounds in finance, economics, business, or related fields, and often hold degrees in finance, accounting, or business administration.

Many professionals elevate their standing with advanced certifications such as the Certified Financial Planner™ (CFP®) for financial advisors and the Chartered Financial Analyst (CFA) for financial analysts. These certifications often exemplify a strong commitment to the field and a mastery of complex financial principles, but they don’t guarantee success.

Aspiring financial advisors and analysts may start out in the financial services industry working similar jobs. Entry-level roles, such as financial consultant or investment analyst, can provide valuable experience to future advisors and analysts.

Both roles are goal-oriented, as financial advisors and financial analysts work to help clients or organizations achieve specific financial objectives, whether related to investments, retirement planning, or overall financial well-being.


Financial advisors and financial analysts can differ on their primary roles and focuses. A financial advisor, for example, can provide personalized financial guidance and planning to individual clients. They typically work with them in creating a financial plan to reach short- and long-term goals.

Financial analysts, on the other hand, focus their expertise on analyzing market trends and investment performance. They use statistical software and economic models to anticipate market behavior and guide investment decisions for institutions and individual investors.

Both professionals also differ in the ways that they work with clients. Financial advisors interact directly with individual clients. Whereas financial analysts can often work within organizations, and provide analytical support to executives or investment committees rather than interacting directly with individual clients.

Financial advisors and analysts also have different scopes. Advisors engage in holistic financial planning, which can cover many areas from retirement planning, tax planning, estate planning and risk management to address the overall financial well-being of clients.

Analysts focus instead on specific financial analyses that often focuses on supporting organizational decision-making. This can include evaluating investment opportunities, assessing financial statements and conducting market research.


According to the U.S. Bureau of Labor Statistics, the median annual wage for a personal financial advisor was $95,390 in 2022. However, this number only tells part of the story. Earnings ranged from $46,700 for the bottom 10% of advisors to more than $239,200 for the top 10%. These variations are often due to experience levels and the ability to nurture a strong client base.

Advisors at the start of their careers generally earn less but have the potential to increase their income significantly over time. Additionally, advisors may earn bonuses, commissions and incentive pay on top of their base salaries.

As for financial analysts, their median annual pay in 2022 was slightly higher than their advisor counterparts – $96,220. However, there’s a significantly smaller range of typical salaries in the field, as the bottom 10% of financial analysts earned less than $58,510 in 2022 while the top 10% earned more than $175,720.

What sets financial analysts apart from each other is the sector in which they work. Those in investment banking or securities command higher salaries than their peers who work in credit intermediation or insurance, BLS data shows.


The CFP® and CFA designations are considered the gold standard for credentials in financial planning and financial analysis, respectively.

To obtain the CFA certification, candidates must clear three levels of exams that encompass a wide array of topics, including ethical and professional standards, quantitative methods and portfolio management. The CFA designation is particularly relevant for careers in investment management, research and risk analysis.

On the other hand, the CFP® credential is highly significant for financial advisors focusing on providing client-centric services. This certification emphasizes expertise in financial planning, with a concentration on areas such as retirement planning, tax planning and estate planning.

The requirements for attaining the CFP® designation include a comprehensive examination process, an educational prerequisite and accumulating professional experience – either 6,000 hours or 4,000 hours under an apprenticeship that meets stringent criteria. The robust nature of the CFP® certification ensures that advisors are thoroughly prepared to offer comprehensive financial guidance.

Certifications can significantly impact earning potential. For example, a CFA Institute study from 2019 found that portfolio managers who hold the CFA designation earned a base salary of $126,000 while their total compensation reached $177,000.

Projected Job Growth

Data from the BLS indicates that the employment of personal financial advisors is projected to grow by 13% between 2022 to 2033 – much faster than the average growth rate across all occupations. In that time, there will be around 25,600 job openings in the field each year, according to BLS projections.

Meanwhile, the outlook for financial analysts is strong, but not quite as robust as it for financial advisors. Between 2022 and 2032, total employment of financial analysts is expected to increase by 8%. During that time, the BLS projects there will be approximately 27,000 job openings in the field each year.

Choosing Your Career Path

A hiker reaches a fork in the trail and decides which path to take.

Choosing a career path within the financial sector is not just about the job itself, but matching your personal ambitions and strengths to a role that feels as though it was made for you. Your career choice should be an extension of your unique capabilities and interests, reflecting the type of work that you find most rewarding.

If quantitative analysis sets your heart racing, a financial analyst position might be your calling. Conversely, if you thrive on personal interaction and guiding others, becoming a financial advisor could be your ideal match.

To better understand where you might excel within this sector, consider taking a self-assessment or a quiz designed to pinpoint your interests and strengths in finance. What matters most is finding the path that resonates with your personal preferences and professional goals.

When considering further education, it’s important to understand the difference between certifications and degrees, and why one might choose to pursue these additional credentials. Certifications can provide specialized knowledge and signal a commitment to a profession, whereas degrees offer a broad foundation and understanding of the field. Both can be valuable, but neither is an absolute necessity for success in the financial sector.

Bottom Line

Financial advisors and financial analysts have important roles in the finance sector. Financial advisors typically serve individual clients or families and offer personalized advice and strategies to help them meet specific financial objectives. Financial analyst often work within corporate settings and provide financial insights to help organizations, investment firm and other institutions make strategic decisions.

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