According to the Bureau of Labor Statistics (BLS), almost one in 10 personal financial advisors are based in the New York-Newark-Jersey City metro area. While the Big Apple may be a hot spot for financial advisors looking to start their career, there are many other places where financial advisors are in high demand and have great job opportunities.
In this study, SmartAsset analyzed data to identify and rank the best cities for young financial advisors to start their careers. We compared 100 of the largest U.S. cities across five metrics: average financial advisor earnings, rent as a percentage of average financial advisor earnings, financial advisor search volume relative to population, percentage of high-earning households and percentage of the population nearing retirement. While the first two metrics look at the job situation for financial advisors, the last three focus on demand for advisory services. For more information on our data sources and how we put the information together to create our final rankings, read the Data and Methodology section below.
This is SmartAsset’s second annual study on the best cities for young financial advisors to start their careers, though our methodology changed slightly between years. Check out the 2020 version of the study here.
Key Findings
- Both of the Twin Cities rank in our top 10. Minneapolis, Minnesota ranks as the fifth-best city for young financial advisors to start their careers, while St. Paul, Minnesota ties for ninth. Both cities rank in the top 10% of cities for three metrics: average financial advisor earnings, rent as a percentage of average financial advisor earnings and financial advisor search volume relative to population.
- In most large U.S. metro areas, average earnings for financial advisors are at least six figures. Average financial advisor earnings data is reported by the BLS at the metro area level. According to May 2020 data, average earnings for financial advisors exceed $100,000 in 74 greater metro areas out of the total 100 cities in our study.
1. Chesapeake, VA
Chesapeake, Virginia ranks in the top 20% of cities for three out of the five metrics we considered. It has both the eighth-highest average financial advisor earnings ($158,860) and percentage of the population nearing retirement (26.2%). Additionally, rent makes up only 9.25% of average financial advisor earnings, the 20th-lowest rate in our study.
2. Richmond, VA
Richmond is the second of three Virginia cities that make it into our top 10. It ranks in the top 10% of cities for two metrics: average financial advisor earnings and rent as a percentage of average financial advisor earnings. According to BLS data, financial advisors in the greater Richmond metro area earn an average of almost $160,700 annually. With median annual rent in Richmond amounting to about $12,900, young advisors can expect to spend only about 8% of their pre-tax salary on housing costs.
3. New Orleans, LA
Financial advisors in New Orleans, Louisiana earn an average of $141,630 annually – a top 25 rate. Beyond that, New Orleans ranks in the top fourth of cities for two additional metrics: rent as a percentage of average financial advisor earnings (8.56%) and percentage of the population nearing retirement (24.8%).
4. Portland, OR
Across the five metrics we considered, Portland, Oregon ranks particularly well for financial advisor search volume relative to the population. Using data from SmartAsset’s financial advisor matching tool, we found that relative to population, Portland residents search for financial advisors 1.40 times more often than the average across all 100 cities in our study. Additionally, there are many high earners in Portland – 11.0% of households earn $200,000 or more annually.
5. Minneapolis, MN
Average earnings for financial advisors in Minneapolis, Minnesota are fourth-highest in our study, at $161,020. With Minneapolis median monthly rent at $1,068, young advisors can expect to spend around 8% of their pre-tax salary on housing costs – a top 10 rate. Additionally, SmartAsset data shows that Minneapolis residents search for financial advisors 2.18 times more often than residents elsewhere.
6. San Francisco, CA (tie)
Financial advisors in San Francisco, California tend to have high earnings – and with many high-earning households in the area, they seem to be in high demand. Specifically, average financial advisor earnings in San Francisco are 11th-highest, at almost $156,000. Moreover, more than 30% of households earn $200,000 or more per year and financial advisors are searched 1.11 times more often than the average across all cities in our study.
6. Virginia Beach, VA (tie)
Virginia Beach, Virginia ranks in the top third of cities for three metrics. It has the eighth-highest average financial advisor earnings ($158,860) and the 32nd-lowest rent as a percentage of average financial advisor earnings (10.30%). Additionally, almost 25% of the population is between the ages of 45 and 64.
8. Spokane, WA
Located in eastern Washington, Spokane is the No. 8 city for young financial advisors to start their career. It ranks in the top 25% of cities for four metrics. It has the 22nd-highest average financial advisor earnings ($138,570) and seventh-lowest rent as a percentage of average financial advisor earnings (7.73%). Financial advisor search volume relative to population is 23rd-highest, with online search rates 1.17 times higher than the average. Finally, the percentage of the population nearing retirement is the 20th-highest, at 24.8%.
9. St. Paul, MN (tie)
St. Paul, Minnesota has the fourth-highest average financial advisor earnings ($161,020) and second-lowest rent as a percentage of average financial advisor earnings (7.46%) in the study. Additionally, residents search for financial advisors about two times more than the national average.
9. Fremont, CA (tie)
Fremont, California rounds out our list of the top 10 cities for young financial advisors to start their careers. Although it might be expected to have much higher rents as a percentage of financial advisor earnings (almost 20%, the sixth-lowest in the study), the city ranks in the top five on the two metrics measuring demand for financial advisors. Across all 100 cities, Fremont has the highest percentage of high-earning households (31.0%) and fifth-highest percentage of the population nearing retirement (27.5%).
Data and Methodology
To find the best cities for young financial advisors to start their careers, SmartAsset looked at data for 100 of the largest cities in the U.S. We compared those cities across five metrics:
- Average financial advisor earnings. This is reported at the metro area level by the Bureau of Labor Statistics. Data is for May 2020.
- Rent as a percentage of average financial advisor earnings. This is the median annual rent divided by average financial advisor earnings. Data comes from the Census Bureau’s 2019 1-year American Community Survey as well as the Bureau of Labor Statistics.
- Financial advisor search volume relative to population. This is the search volume for financial advisors in each city relative to population compared to the average search volume for financial advisors across the 100 cities in our study. Data comes from SmartAsset’s financial advisor matching tool.
- Percentage of high-earning households. This is the percentage of households earning $200,000 or more. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
- Percentage of the population nearing retirement. This is the percentage of the population between the ages of 45 and 64. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
We ranked each city in every metric, giving full weighting to each. We then found each city’s average ranking and used the average to determine a final score. The city with the highest average ranking received a score of 100. The city with the lowest average ranking received a score of 0.
Please note that our methodology is slightly different than last year. We changed the metric on searches for financial advisors to be relative to population so that larger cities did not have an advantage relative to smaller cities we considered.
Looking for a Financial Advisor?
- Our tool makes it easy to find the right financial advisor that fits your needs. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- Do your research on financial advisor fees. Financial advisor fee structures are varied. Most are either fee-only or fee-based. Fee-only advisors charge based on the services they offer while fee-based advisors make money by charging a combination of fees and earning commissions on investment products. For more information on the two, check out our complete guide here.
Questions about our study? Contact us at press@smartasset.com.
Photo credit: ©iStock.com/FatCamera