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What does a Financial Planner do?

Financial planners provide a valuable service to individuals who need help with personal finances, investments and retirement planning. Starting with a general overview of income, expenses and savings, a financial planner guides a client through the process of setting short term goals, long term goals, and a step-by-step action plan. Financial planners, also known as personal financial advisors, recommend appropriate types of savings plans and investments and can place orders for stocks, bonds or insurance.

financial planner

An effective financial planner will meet one-on-one with a client, conducting an interview that covers more than just the individual’s savings and investments. Personalized financial planning also takes into account:

  • Outstanding debts, such as mortgages, car loans, credit cards
  • Tax bracket and tax advice needs
  • Insurance coverage for property, health care and disability
  • Investment risk tolerance
  • Wills or estate plans
  • Retirement wish list

Preparation for a career as a financial planner

A college education is required for a prospective financial planner. You should expect to earn at least a bachelor’s degree in a relevant field like business, accounting, finance or law. Course work generally includes math, economics, investments, taxes and estate planning. Many candidates in this competitive field go on to earn master’s degrees. Financial planners also need licenses for direct buying and selling of stocks, mutual funds, bonds and insurance.

Good people skills are crucial for financial planners. According the Bureau of Labor Statistics, 29 percent of personal financial advisors are self-employed, placing a high priority on attracting and keeping a healthy client base. Even those who work for banks, brokerages or securities firms deal with a variety of personalities and financial sophistication levels and need good marketing skills and the ability to explain and simplify complex financial concepts.

Employment outlook for financial planners

With so many baby boomers approaching retirement age, expecting to live longer, and relying more heavily on their retirement funds, the job outlook for financial planners is strong. The Bureau of Labor Statistics projects employment growth of 30 percent for this occupation.

Salary and career advancement are possible through promotion and certification. You could seek promotion to a higher management level, or move to a position as private banker at a large bank. You could found your own business or start a branch office of a securities or brokerage firm. After spending three years as a working personal financial advisor, you could apply for a Certified Financial Planner credential. Testing for this certification is provided by the Certified Financial Planner Board of Standards.

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