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How to Become a Financial Adviser

Responsibilities, working hours, what to expect and qualifications needed

Career guides » How to Become a Financial Adviser

What does a financial adviser do?

A financial adviser is sometimes also known as a financial planner, broker or wealth manager. They provide regulated financial advice on money management and assist individuals and businesses in selecting the financial products (e.g. savings, pensions, investments, mortgages and insurance) that meet their needs.

There are two types of financial advisers, independent and restricted.

  • Independent – are also known as independent financial advisers or IFAs. They can consider all types of financial products from all providers across the entire market, and their advice must be unbiased and unrestrictive.
  • Restricted – can only offer advice on a limited range of products and providers. They must clearly explain the nature of the restriction before providing advice.

Financial advisers can choose to be generalists or specialise in specific financial products, e.g. pensions. Therefore, what a financial adviser does will depend on whether they are independent or restricted and if they are generalists or specialise in any particular financial products. Whether they are employed or self-employed will also influence what they do.

A financial adviser can work in various environments, such as an office, a contact centre, their own home or a client’s home/business. They will carry out many tasks, including meeting clients and talking to them about their finances and goals, researching financial products, providing advice, negotiating with product providers, updating clients, etc. The role may also require ad hoc administrative work, such as producing financial reports.

A financial adviser’s main aim is to find the most suitable financial products to meet their client’s financial situation, needs and goals and to secure a sale. They must also research and keep up to date with new financial products and legislation changes to provide the best advice. Overall, being a financial adviser is about helping clients with their finances, as people often do not know what options they have and may make mistakes that could cost them more in the long run.

Financial advisers can work with many different people. If employed, they will usually work with a team of colleagues, including senior managers, other financial advisers and support staff. They will also liaise with external stakeholders, including clients (individuals and businesses), financial product providers and the Financial Conduct Authority (FCA). Depending on the financial products they specialise in, they also may communicate with other professionals, such as estate agents, solicitors and valuers.

Responsibilities

A financial adviser’s responsibilities will depend on many factors, including who they work for (employed or themselves), the type of financial products they specialise in and the type of advice they provide.

Some examples of their duties may include (this list is not exhaustive):

  • Meeting with clients and speaking with them about their current financial situation and future plans/goals.
  • Analysing information and developing tailored financial plans and strategies to best suit clients’ needs.
  • Researching financial products from various sources.
  • Recommending or choosing financial products for clients.
  • Providing advice to clients clearly and concisely and answering any questions they may have about their options and risks.
  • Conducting risk analyses.
  • Negotiating with financial products providers.
  • Promoting, buying and selling financial products on behalf of their clients.
  • Providing clients with updates regarding their investments.
  • Reviewing clients’ situations and needs and responding accordingly.
  • Meeting sales and performance targets.
  • Producing financial reports.
  • Keeping abreast with new financial products and legislation changes and informing clients.
  • Complying with the necessary regulatory requirements, e.g. registration, disclosure, advice and costs.

Working hours

A financial adviser can expect to work 35–38 hours a week, but they can do more or fewer hours depending on the requirements of their role and if they are self-employed. Although Monday–Friday is typical, financial advisers can also work unsociable hours, e.g. evenings, weekends and bank holidays, especially when attending appointments or events.

Financial advisers may need to travel to meet with clients or to networking events and conferences, which can lengthen the working day. There are also opportunities to work away from home and overseas, but these are not common.

What to expect

There are many positives to being a financial adviser, and it can be a rewarding career choice. Finances and money can cause much stress, and many people do not know what to do in their situation. Financial advisers can help people to understand their options and get their finances back on track. They can go home at the end of the working day knowing they have made a difference by providing meaningful advice, especially when helping people and businesses to get out of debt. It can also help them with their own personal finances.

There are plenty of financial adviser roles; jobs are available nationally, and there are different areas to specialise in. The salary is also competitive compared to other career choices, even at the entry level. There is the potential to earn significantly with experience, and there may also be bonuses, commissions and additional benefits.

Being a financial adviser can give individuals independence and flexibility, particularly if self-employed. Having an opportunity to be your own boss can be attractive, as it allows individuals to take charge of their working day and overall career progression. It can also help them achieve a decent work-life balance.

If an individual decides to become a self-employed financial adviser, the business start-up costs are lower than in other careers. There are also numerous professional development opportunities and support within the industry.

Boredom will never be a problem for financial advisers, as their work can be varied. There are also plenty of opportunities to specialise, so if an individual finds a specific area they are really interested in, they will enjoy their work.

Even though there are positives to being a financial adviser, there are challenges and cons, e.g.:

  • Qualifications and compliance – an individual must have professional qualifications recognised by the FCA and register with them before providing advice or selling products. It can take some time and study to become a financial adviser, and individuals must continue to comply with the regulatory requirements.
  • Fast-paced and demanding – being a financial adviser can be stressful at times. They will often have multiple clients and must be able to juggle different demands. They will need to research and keep up to date with financial products and changes in the law and be available to advise clients when they need it. They really need to know their stuff, and it is not an easy job.
  • Being self-employed – whilst being your own boss can be fulfilling, it can also introduce other challenges. Working for yourself, advertising and building a client base can create additional work for self-employed financial advisers. It also takes a lot of willpower and commitment to work from home and requires good organisation and time management skills.

Every career choice has pros and cons, and prospective financial advisers must know what to expect before deciding whether it is for them. Juggling different demands can be challenging and stressful. It is fast-paced and demanding, and individuals must be committed to continued learning and regulatory compliance. However, there are many positives too, and those who become financial advisers really enjoy their work, as it allows them to help people with their finances.

When considering whether to be a financial adviser and the type of role, individuals should look at the pros and cons. They should also ensure they have the right personal qualities to carry out the role and responsibilities required.

Personal qualities needed to be a financial adviser

Some of the personal qualities a financial adviser requires will include (this list is not exhaustive):

  • Approachable, honest, trustworthy, reliable, ethical and professional.
  • Tenacious, determined and motivated.
  • Discrete and confidential.
  • Knowledge of financial markets and products, economics, accounting and associated legislation and rules.
  • Knowledge of maths, e.g. to create financial plans.
  • Excellent communication skills, both written and verbal.
  • Active listening skills.
  • Interpersonal skills.
  • Customer service skills.
  • Research and analytical skills.
  • Numeracy skills.
  • Decision-making skills.
  • Negotiating and influencing skills.
  • Business management skills.
  • Organisation and time management skills.
  • Being thorough, accurate and having attention to detail.
  • The ability to sell services and products.
  • The ability to maintain objectivity at all times.
  • The ability to explain complicated financial information to clients simply, clearly and concisely.
  • The ability to work to tight deadlines and meet targets.
  • The ability to establish relationships with clients.
  • The ability to work well under pressure and remain confident and calm in stressful situations.
  • The ability to use IT equipment, e.g. computers and hand-held devices, and relevant software packages.
  • The ability to be flexible and open to change.
  • The ability to work well with others in a team and alone using their own initiative.

Qualifications

There are many different ways to become a financial adviser, e.g. university or enrolling on an apprenticeship.

University

Individuals will usually need a degree to become a financial adviser, and the role is open to graduates with a degree in any subject.

However, it will maximise an individual’s chances if they have a degree in a relevant subject, such as:

  • Accountancy.
  • Business management.
  • Finance, financial services or financial studies.

Individuals usually need two or three A levels or equivalent for a degree course.

Apprenticeship

There is an apprenticeship route to becoming a financial adviser, e.g. financial adviser higher apprenticeship or a financial services professional degree apprenticeship. To be successful, individuals will usually need four or five GCSEs at grades 9 to 4 (A* to C) and A levels or equivalent.

Opportunities are found on Government’s Apprenticeships and Institute for Apprenticeships and Technical Education.

Financial advice qualifications

To become a financial adviser, and before providing advice, individuals will need to pass a Level 4 qualification in financial advice recognised by the FCA, which is equivalent to a first-year degree programme.

Some examples include (this list is not exhaustive):

It takes approximately nine months to complete a Diploma, but this will depend on the course and whether an individual studies full time or part time. Individuals should check the duration and the entry requirements for each course before enrolment.

Employers may provide the resources and support for individuals to complete this qualification.

There are also Level 6 qualifications if individuals want to develop their knowledge and skills, for example:

Additional qualifications

Individuals may need to take additional qualifications and examinations if they want to specialise in specific areas and industries, e.g. mortgages, equity, stocks and shares, or long-term care protection.

Working in a finance company to gain experience

On the job training and volunteering

Having a degree is not always mandatory. Some employers may decide to take on individuals and train them if they have the necessary personal qualities and enthusiasm for the role. It would help individuals to have some experience in finance, sales or customer services.

Many individuals start their careers working in a bank as a customer services adviser whilst studying part time or as a graduate trainee adviser. There may also be opportunities to work at a finance company to learn on the job by shadowing and helping financial advisers, e.g. as a paraplanner. Working in other sectors, e.g. insurance, can also help individuals move into financial advice.

There is no substitute for practical experience. Volunteering can also help individuals understand what is involved in being in finance and help them build their knowledge and skills. Individuals could volunteer with charities in their finance departments, but it may require some knowledge and experience. There is information on volunteering and local opportunities on Do-IT, NCVO and Volunteering Matters.

Work experience relating to customer service, accountancy or finance can be beneficial and can help an individual work towards becoming a financial adviser. Even college and community courses can count, e.g. AAT in business skills or accounting and customer service skills.

Training courses

Learning does not stop with experience or once someone becomes qualified. Attending relevant training courses and having additional certifications can help financial advisers enter the profession, enhance their employability and give them a competitive edge. Many colleges and accredited private training providers can provide relevant training courses.

Some examples of relevant courses that may be useful for financial advisers include:

  • Customer service.
  • IT, e.g. Excel, PowerPoint and Access.
  • Maths and numeracy.
  • Business management.
  • Marketing.
  • Time management.
  • Finance fundamentals.

There are also courses in specific areas of finance, for example:

  • Risk analysis.
  • Budgeting.
  • Banking.
  • Investments.
  • Financial markets and trading.
  • Accounting.
  • Mortgages.
  • Pensions.
  • Financial planning/analysis.

If starting out, it may be worth enrolling on low-cost online courses to see if a career in finance is of interest. That way, if it is not, it will save an individual a lot of time, money and trouble.

Professional bodies, institutes and associations, such as the the London Institute of Banking & Finance (LIBF), the Chartered Banker Institute (CBI), the CFA Society of the UK, the Chartered Institute for Securities and Investment (CISI)  and the Chartered Insurance Institute (CII) also advise on reputable training courses. Some also provide events and support to help individuals become financial advisers, giving them the means to continue their professional development.

The type of training required will depend on what employers are looking for and the areas and products in which financial advisers specialise. It is worth looking at several job advertisements to identify the training required for specific roles and specialisms. Jobs are on websites, such as GOV.UK find a job service, Indeed, LinkedIn, eFinancialCareers, City Jobs UK, topfinancialjobs.co.uk and other job sites. Recruitment agencies may also offer financial adviser jobs.

More relevant training and competence (skills, experience and knowledge) will open up more opportunities. Refresher training will also be required, as it keeps an individual’s knowledge and skills up to date and is a requirement for regulatory purposes.

Self employed financial adviser

Being self-employed

There are additional responsibilities associated with being self-employed.

Self-employed financial advisers must:

  • Have the correct insurances, i.e. public liability and home/car business. If employing anyone, employer’s liability insurance will be required.
  • Register with HMRC.
  • File tax returns.
  • Register with the ICO to hold personal data (to comply with the Data Protection Act 2018 and the GDPR).

Further advice and guidance on being self-employed can be found on GOV.UK.

Registration

Individuals must register with the Financial Conduct Authority (FCA) to become an ‘approved person’ and to provide financial advice.

They must:

  • Meet the requirements and follow the principles of the ‘fit and proper’ test.
  • Comply with the Conduct Rules.
  • Report anything that could affect a financial adviser’s ongoing suitability to the FCA and the authorised firm.

There is a cost for initial registration and authorisation and an annual fee payable to the FCA.

Further information on applying to become an approved person can be found here.

Criminal records checks

Financial advisers must undergo a criminal record check, as they will have contact with vulnerable people. A criminal record, caution, warning, or conviction may put off prospective employers. However, they should account for the seriousness of the crime, when it occurred and its relevance to the role.

The organisation that holds criminal records will depend on the country within the UK, for example:

  • England and Wales – Disclosure and Barring Service (DBS).
  • Northern Ireland – AccessNI.
  • Scotland – Protecting Vulnerable Groups (PVG) scheme.

Driving

Some financial advisers will need to drive as part of their role. Therefore, they should have a full driving licence, preferably with no points.

Other requirements

The FCA requires all retail investment advisers to hold a Statement of Professional Standing (SPS). Advisers must adhere to a code of ethical standards and complete at least 35 hours of CPD every year.

Individuals must review their SPS certificates annually, and there is a cost.

Financial adviser working in bank

Where do financial advisers work?

Financial advisers can be employed and work for companies across the UK, such as (this list is not exhaustive):

  • Banks.
  • Building societies.
  • Mutual fund companies.
  • Wealth management businesses.
  • Independent financial advice firms.
  • Financial planning companies.
  • Investment firms.
  • Accounting firms.
  • Law firms.
  • Insurance companies.
  • Property groups.
  • Estate agencies.
  • Pension consultancies.
  • Other high street financial institutions.

They can also be self-employed or work for recruitment agencies.

Financial advisers can work in a variety of establishments, such as (this list is not exhaustive):

  • Offices.
  • Contact centres.
  • Clients’ homes.
  • Clients’ business premises.
  • Their own home.

Some financial advisers may also travel during their working day, which may require some overnight stays, but this is not common. More experienced financial advisers may have opportunities to work overseas for international and offshore companies.

Experienced financial adviser

How much do financial advisers earn?

A financial adviser’s salary will depend on their qualifications, experience, geographical location, specialist area, and whether they choose to be self-employed, for example (these figures are only a guide):

  • An entry-level financial adviser (less than 1-year experience) – £23,982 a year.
  • An early career financial adviser (1-4 years of experience) – £30,648 a year.
  • A mid-career financial adviser (5-9 years of experience) – £42,000 a year.
  • An experienced financial adviser (10-19 years of experience) – £43,973 a year.
  • The average salary for a financial adviser – £35,046.

Some financial advisers can earn more than £60,000 with more seniority and even over £100,000 if working for specialist divisions in larger organisations.

In addition to a salary, financial advisers may also receive bonuses, commission and other benefits.

Self-employed financial advisers will need to factor in various expenses when considering the salary, e.g. tax, National Insurance, travel, other insurances (business/liability), equipment, registration, qualifications and training, etc.

As an apprentice, the salary will depend on an individual’s age and how long they have been in their apprenticeship. Apprentices must earn at least the current National Minimum Wage (NMW). Some employers will pay more than this. However, it will depend on the organisation and role on offer.

Retirement finance adviser

Types of financial advice to specialise in

As stated earlier, individuals can decide to be independent or restricted financial advisers. They may be employed, self-employed or work for a recruitment agency.

They can also provide general advice or specialise in providing specific financial advice and products, such as (this list is not exhaustive):

  • Retirement and pensions.
  • Divorce and financial settlements.
  • Personal injuries.
  • Wills and trusts.
  • Savings and investments, including stocks and shares.
  • Property, equity release and mortgages.
  • Financial or tax planning (individual or corporate).
  • Insurance products, e.g. life, health, car, home, travel and business.
  • Protection, e.g. if something unexpected happens later in life.
  • Long-term care planning.
  • International financial planning, e.g. expats and non-UK residents.
  • High net worth individuals (i.e. with over £10 million).

There are also roles where financial advisers can provide specialist independent financial advice to specific professions, e.g. teachers, doctors and dentists.

All different financial adviser roles will require differing knowledge, skills, experience and qualities. However, all financial advisers must be registered with the FCA to become an ‘approved person’ and carry out their responsibilities ethically and professionally. Any additional areas of expertise will depend on what a company is looking for (if employed) and the specialist areas a financial adviser wants to work in. Further qualifications and training will usually be necessary for specialised areas, e.g. mortgages.

If financial advisers do not carry out their roles correctly, i.e. if they provide incorrect advice or recommend the wrong products, it can cause significant issues for customers’ finances and may result in them losing money or getting into debt. In serious cases, customers may decide to complain, refer their complaint to the Financial Ombudsman Service or start legal proceedings. Financial advisers can also face enforcement from the FCA, e.g. withdrawal of authorisations, fines and even prosecution. Therefore, they must be able to provide financial advice competently. They should also only give advice within their remit and the scope of their role.

Financial adviser keeping up to date with changes

Professional bodies

Financial products, standards, codes, markets and laws are regularly changing. Therefore, financial advisers must keep abreast with the latest developments and changes to comply with the law and ensure they carry out their roles effectively and correctly. Continuing professional development (CPD) gives financial advisers the knowledge and skills to keep up to date with these changes, understand their responsibilities and progress their careers. It is also mandatory for advisers that carry out retail investment activities.

Joining a professional body and association can help prospective and current financial advisers enhance their skills and overall career. The London Institute of Banking & Finance (LIBF), the Chartered Banker Institute (CBI), the CFA Society of the UK, the Chartered Institute for Securities and Investment (CISI) and the Chartered Insurance Institute (CII) offer different levels of membership, CPD, support and access to industry contacts and networking events.

There is ample opportunity for career progression for financial advisers. With more qualifications and experience, they can become a senior adviser, a company director or partner, or advise clients with large sums of money to invest. They can also decide to specialise in one area, e.g. pensions, or recruit and train new staff. Alternatively, they may choose to become self-employed and start their own business or work for agencies.

Knowledge, skills and experience from being a financial adviser can also lead to a career in different areas. For example, they could move into a regulatory role to ensure individuals and companies are complying with the law and rules.

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