A financial planner advises individuals in managing their personal finances. Many planners work independently or in small firms, though larger financial services firms either are adding financial planners to their staffs or are insisting that their financial advisers or financial consultants also become certified as financial planners.
A financial planner deals with matters such as:
- Saving for retirement
- Saving for college
- Saving for home or car purchase
- Expenditure control
A financial planner helps clients create personal budgets, control expenditures, set goals for saving, and implement strategies for accumulating wealth. They may have working relationships with financial advisers, investment managers, or mutual fund companies, utilizing these specialists for the actual investment of their clients' funds.
The job requires keeping current with developments in financial products, tax law, and strategies for personal financial management, particularly concerning retirement plans and estates. Success also requires sales ability, both in the acquisition of new clients and in the development of new ideas to improve the financial situation of existing clients.
Financial Planner Duties & Responsibilities
A financial planner's regular responsibilities include:
- Providing financial planning, insurance, and investment services to clients
- Ensuring client records are maintained and kept current
- Cultivating and maintaining ongoing relationships with clients by tracking their successes and keeping them informed about any changes that may affect their finances
- Acting as a liaison between the client and other financial professionals
- Guiding clients through personal financial analysis, including goal setting
- Assisting clients with estate management, tax returns, budgets, or other financial tasks
Financial Planner Salary
Financial planner salaries vary depending on whether you work for a financial institution or are in private practice. Other determining factors include areas of expertise, certifications, and degrees:
- Median Annual Salary: $62.000 ($22.72/hour)
- Top 10% Annual Salary: $112,000 ($50.00/hour)
- Bottom 10% Annual Salary: $40,000 ($13.23/hour)
Education Requirements & Qualifications
To become a financial planner, education can play a significant role.
- A bachelor's degree is the minimum educational requirement expected of a financial planner.
- Coursework in finance, accounting, or economics is helpful but not required.
- A Master of Business Administration (MBA) degree may make you an especially desirable job candidate, depending on the firm.
The legal requirements for operating as a financial planner vary by state. However, even in states where it isn't mandatory, passing the exam to become a certified financial planner (CFP) is highly advisable. The CFP designation increases your credibility and marketability to potential employers and clients.
According to the Certified Financial Planner Board of Standards Inc. (CFP Board), to become certified, you need to meet the following requirements:
- Education: Completion of a college-level degree in personal financial planning or a CFP Board-accepted equivalent, including completion of a financial plan development (capstone) course registered with the CFP Board.
- Examination: A bachelor's degree is a condition of initial certification, however, it does not need to be met before registering for the examination.
- Experience: Because CFP certification indicates to clients your ability to provide financial planning without supervision, the CFP Board requires you to have 6,000 hours of experience through the standard pathway, or 4,000 hours of experience through the apprenticeship pathway that meets additional requirements.
- Ethics: As a certified financial planner, you must agree to follow the high standards of ethics and practice outlined in the CFP Board’s Standards of Professional Conduct. In addition to undergoing a background check, you will need to complete a CFP certification application on which you will need to disclose information about your background.
Financial Planner Skills & Competencies
Financial planners need an assortment of qualities to perform their job optimally:
- Analytical and problem-solving skills: Ability to analyze the market's financial data and provide proper financial advice to clients
- Exceptional communication, presentation, and negotiation skills
- Communications and interpersonal skills: Ability to solicit new business, network with associates, and manage relationships with clients
- Organized and detail-oriented: Properly allocating the time necessary to manage each client's finances and risks, and checking details to minimize the likelihood of error
Financial advising jobs, under which financial planning is classified, are expected to continue to grow by 15% to 2026, according to the Bureau of Labor Statistics. The subcategory of financial planning tends to track closely with the trend for financial advising as a whole.
Financial planners commonly work in investment firms or banks. Others are self-employed or employed in small, independent practice groups. Their work may require them to travel, such as attending conferences, teaching finance courses, visiting clients, and attending networking events to attract new clients.
The time commitment is highly variable and dependent on the type of practice, client workload, and time and effort required to gain new clients. Thus, it can range from a part-time effort of under 40 hours per week to one that far exceeds 40 hours.
To accommodate their clients' schedules, financial planners must be available for meetings and telephone consultations in the evenings and on weekends. In addition, longer hours may be required to conduct analysis, research, and continuing education.
Comparing Similar Jobs
Those interested in a financial planning career may also want to consider these similar positions, along with the median salary:
- Certified Financial Planner: $66,499
- Chief Financial Officer: $130,181
- Financial Adviser: $58,660
- Financial Adviser Assistant: $41,874
- Financial Analyst: $59,422
- Financial Consultant: $66,314
- Investment Consultant: $67,492
- Portfolio Manager: $84,635
- Private Banker: $69,721
- Trust Officer: $66,090
Source: PayScale, March 2019
How to Get the Job
A number of career websites include job listings for financial planners, iHireFinance features financial planner positions. Other job sites include LinkedIn, Indeed, and CareerBuilder. These sites also provide tips for resume and cover letter writing, as well as getting and mastering an interview.
Look for internships from various financial planning firms in your area, and work with different firms to determine the type of firm and business that fit your career goals.
Memberships to key organizations provide networking opportunities that can lead to a job. The Financial Planning Association (FPA) and the National Association of Personal Financial Advisors (NAPFA) GENESIS provide such opportunities.