Whether you’re considering a career as a financial advisor or looking to work with one, it’s helpful to understand the landscape of this profession. Financial advisors provide expertise to help individuals and organizations make smart money decisions. Estimates vary, but approximately 300,000 financial advisors work in a range of industries and in every state and city. Most have college degrees and are white males, but women and minorities also fill a significant number of positions.
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Financial Advisor Duties and Earnings
Financial advisors meet with their clients to understand their financial goals and make recommendations to help them achieve those aims. Common duties include analyzing assets and investments, assessing risk tolerance, developing comprehensive financial plans and selecting appropriate financial products.
On a day-to-day basis, advisors build relationships, provide education, make financial forecasts, monitor progress toward goals and adjust plans as needed. Working as a financial advisor generally rewards strong analytical, communication and people skills.
Financial advisors earn attractive incomes. Government figures pegged the median salary for a financial advisor in 2023 at $99,580. That is well above the national average for all occupations.
Employers of Financial Advisors
Financial advisors work for a range of employers. A heavy concentration exists in the finance and insurance industries, where about three-quarters of all financial advisors labor for various financial institutions. Many of these work for securities brokerages, banks and credit unions.
Other common employers include insurance agencies, accounting firms and management consulting companies. Large corporations also employ financial advisors to assist executives and provide expertise on investments and benefits. Overall, most advisors work for private companies rather than government agencies or nonprofits.
Nearly 15% of financial advisors are self-employed. In this capacity, they often serve individual savers and investors and dispense advice on personal financial matters such as retirement planning, estate planning, investing and budgeting. Self-employed financial advisors may also have businesses as clients, helping them with real estate, borrowing, forecasting and other tasks.
Financial Advisor Employment
Estimates of total U.S. financial advisor jobs range from 240,000 to 370,000. The Bureau of Labor Statistics tallied over 272,190 positions in 2023. DataUSA generated an estimate for 2020 that came in at around 372,000, while online recruitment site Zippia’s research pointed to over 240,000 financial advisor roles.
Variances may reflect differences in defining this multifaceted profession. For instance, BLS figures do not include self-employed financial advisors. Whatever definition is used, all sources concur this field employs several hundred thousand professionals nationwide.
Geography of Financial Advice
Certain states and cities employ more financial advisors, largely tracking population and wealth concentration. As befits the home of Wall Street, New York state leads all states with over 30,000 financial advisors. Other top states for financial advisor employment include California, Florida, Texas and North Carolina.
Among cities, the New York City metro area alone accounts for 10% of financial advisors. Other prominent financial centers including Los Angeles, Chicago, Dallas and Miami also make the top metro lists. However, advisors work in every state and city helping Americans nationwide meet financial goals. Areas far from cities also employ financial advisors to serve farmers, ranchers and other residents of rural communities.
Financial Advisor Demographics
The typical financial advisor is a white male in his mid-40s, according to occupational data. Approximately 70% of advisors are men. Whites account for 70-80% of the profession, with Asian, Latino and Black advisors each representing 5-10% of the workforce. Over 60% of advisors are 40 years or older.
Most financial advisors hold bachelor’s degrees, often in business, finance or economics. About one in 10 advisors have master’s degrees. Spanish and French are the most common non-English languages spoken.
Future of Financial Advisors
Strong job growth is forecast for financial advisors. The Bureau of Labor Statistics projects advisor jobs will increase at double the average national rate over the next decade. Rising wealth and an aging population seeking retirement advice are driving demand.
However, aspiring advisors face competition. Turnover is high due to the difficulty of acquiring client assets. Advisors who develop sound financial planning skills and successful marketing techniques should find abundant opportunities on the horizon.
Financial Advisor Marketing
Marketing is one of the most important skills that a financial advisor can learn because if they can’t find new clients then they aren’t going to be able to make it long-term. Despite its importance, 85% of financial advisors report that it is difficult to find time for the activity. That’s an interesting statistic because marketing isn’t cheap. Advisors spend $15,908, on average, on marketing activities.
This means that all marketing needs to be as efficient and cost-effective as possible. On method to achieve that is through online lead generation or similar services. SmartAsset’s Advisor Marketing Platform offers financial advisors services like client lead generation, automated marketing and more. Learn about SmartAsset AMP today.
Bottom Line
America relies on hundreds of thousands of qualified financial advisors for investment expertise and retirement planning. Although most advisors are college-educated white males in their 40s, diversity is increasing. Forecasts indicate robust job growth for financial advisors, owing to increases in wealth and the number of retirees needing guidance. Overall, the financial advice field promises solid prospects for motivated professionals who can build books of business.
Tips for Financial Planning
- Add new clients and AUM at your desired pace with SmartAsset’s Advisor Marketing Platform. Sign up for a free demo today.
- Find out average household budgets in your neighborhood using SmartAsset’s free Budget Calculator.
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