How to become a financial adviser

Our comprehensive guide on how to become a financial adviser unpacks the qualifications and skills necessary for this job, along with the salary and career growth you can expect in the future.

 

Summary

• Financial advisers can specialise in different arenas, including tax planning, mortgages, pension planning, and more.
• The financial advice profession is governed by the Financial Conduct Authority (FCA), and specific qualifications may be required for the different levels of specialisation.
• In addition to earning the correct qualifications, people skills and experience are necessary to succeed and progress in this field.
• According to IBISWorld, there were 5,199 Financial Advisers businesses in the UK in 2023, a decline of -0.3% from 2022.

 

What does a financial adviser do?

The primary responsibility of a financial adviser is to assist their clients in making the most informed choices with their money. This may relate to retirement planning, tax management, mortgage advice, insurance, estate planning, and investments. Each field has its specific focus, but daily tasks can include the following:

• Meeting with clients to discuss their financial status and goals.
• Crafting financial plans in line with the client's financial objectives, which often involves providing investment advice.
• Monitoring their clients' investment performance and recommending changes to the portfolio when necessary.
• Marketing their services to prospective clients.
• Purchasing and selling financial products on their client's behalf.
• Creating financial reports to showcase investment performance.
• Providing clients with information on the risks and benefits of various financial products.
• Keeping abreast of the markets and new financial regulations.

 

What are the benefits of being a financial adviser?

Becoming a financial adviser can be an extremely gratifying career. Once you’ve established yourself as a reputable financial adviser, you have the potential to grow your income. Continued education and experience can attract high-net-worth individuals and wealthy firms as clients, giving your income a healthy boost. 

However, the benefits of a financial adviser job are not merely monetary. Working as a financial adviser offers flexible working hours with varied tasks. Experienced advisers with a sturdy client base may have to work fewer hours than those starting in the industry.

A career in financial advice is also rewarding from the perspective of helping clients grow their wealth and offering meaningful counsel and education regarding investments and financial services and products. Clients often have little knowledge of investments and build relationships with trusted professionals who help them transform their objectives into realities.

 

How much do financial advisers earn in the UK?

As with all jobs, salaries are commensurate with experience, education, and expertise. The area, firm, and specific field also play a role. Typical salaries for a full-time employed or independent financial adviser fall into these brackets:

• A trainee adviser may have a starting salary ranging between £22,000 and £33,000.
• Qualified financial advisers may earn £30,000 - £45,000 per year.
• Senior advisers could earn up to £60,000.
• Wealth managers or advisers working in the wealth divisions of private banks or similar organisations could earn in excess of £100,000.
• The average financial adviser salary in the UK is around £45,000.
• In addition to their basic salaries, financial advisers may also earn commissions and bonuses.

 

What are the expected qualifications required to become a financial adviser?

The FCA regulates the financial advice sector, so all advisers must meet their criteria. To enter this field, the FCA requires a minimum qualification of level 4 in financial advice.

There are various paths prospective financial advisers can take to qualify for their positions, including:

• A degree in finance-related subjects.
• Diploma for Financial Advisers, level 4 via The London Institute of Banking & Finance.
• Diploma in Regulated Financial Planning, level 4 via the Chartered Insurance Institute.
• Investment Advice Diploma, level 4 via the Chartered Institute for Securities & Investment.
• Apprenticeships where trainee advisers get on-the-job training while studying for the level 4 qualification.
• Some advisers take their studies a step further to become chartered accountants.

The cost of a financial advice qualification

The expected costs of the qualifications to become a financial adviser will be approximately £1,000, depending on the costs of the courses taken. This figure could escalate if additional study material or retaking some exams is necessary. Some employers may cover the study fees.

 

What skills are required to become a financial adviser?

In addition to an FCA-approved qualification, financial advisers require a varied set of skills, including hard and soft skills. Some of these critical skills are listed below:

• Mathematical competency for developing financial plans.
• Economics and accounting knowledge for understanding financial products and the current markets.
• Analytical abilities for problem-solving.
• Research and crafting reports.
• Interpersonal skills, such as reliability, trustworthiness, and approachability.
• Communication skills are imperative for explaining financial concepts to clients.
• Active listening.
• The ability to cope well with stress.
• Sales skills are necessary for promoting financial products to clients.
• Business management skills.
• Attention to detail is a vital characteristic as financial advisers are responsible for managing large sums of money on behalf of their clients. 

 

How to become a financial adviser

Depending on the course of study taken to become a financial adviser, it can take as little as nine months. However, if you were to complete a degree, the minimum is three years. While the average cost may be around £1,000, this can skyrocket if many years of study are undertaken. 

If you’re interested in becoming a financial adviser, you can follow the following advice to ensure your career path follows a solid trajectory:

Get a higher level of education or an apprenticeship

While working in the industry is necessary, getting an added qualification is vital for providing clients with the appropriate advice. A degree is not mandatory, and many people choose to work their way up with apprenticeships.

 

Build client relation skills

Clients are the foundation of a financial adviser's business. Soft skills, such as good communication, active listening, and approachability, build trust with clients. 

 

Pick up relevant skills from experience.

Newly qualified financial advisers usually start in administrative or training positions, shadowing an experienced adviser. They have an opportunity to gain experience and pick up the necessary skills before progressing to a more independent role.

 

How long will it take to become a financial adviser?

Depending on the education route and study pace, it could take 2-4 years to become a financial adviser. Climbing the career ladder would require extra time and studies.

 

Can I become an independent financial adviser?

Yes. An independent financial adviser (IFA) is a professional who meets the FCA requirements and can recommend financial products from across the entire market without restrictions. If you can do this, you’re eligible. 

 

What is career progression like for financial advisers?

After gaining some experience, financial advisers could choose to specialise in specific areas, such as working with high-net-worth individuals, tax planning, pensions, or estate planning. 

Promotion within the company may come with opportunities to manage other financial advisers, recruit and train newcomers, and market the business.

Advisers can also move through the ranks by earning additional qualifications to become a Chartered Financial Planner or achieve Chartered Banker Status. An MBA is also a valuable qualification.

 

Want to work with Unbiased?

Becoming a financial adviser is a lucrative and rewarding career. You assist clients in growing their wealth and managing various aspects of their financial lives. This FCA-regulated industry demands specific education levels and sufficient experience to be successful. 

If you’re a financial adviser, Unbiased Pro can help you to grow your business sustainably. You’ll get leads delivered straight to your inbox, as well as all the tools, support and guidance you need.