What Is a Financial Consultant?

Financial Consultant is a professional who provides financial services to clients based on their financial situation. In many countries, financial advisors must complete specific training and be registered with a regulatory body in order to provide advice.

What does a financial consultant do?

Financial consultants look at the whole picture of a client’s financial life, including debts, assets, expenses and income, to help clients determine what those goals should be. Financial consultants who have the proper licenses may also manage their client’s investments.

The kinds of services you receive from a financial consultant will also depend on the type of consultant you work with. They may include:

  • Estate planning.
  • Tax planning and tax strategy.
  • Gifts and inheritances.
  • Retirement planning.
  • Business and financial strategy.

In the United States, a financial adviser carries a Series 7 and Series 66 or Series 65 qualification examination. According to the U.S. Financial Industry Regulatory Authority (FINRA), qualification designations and compliance issues must be reported for public view
FINRA specifies the following groups who may use the term financial advisor: brokers, investment advisers, private bankers, accountants, lawyers, insurance agents and financial planners.
Financial advisors need to be able to take the full picture of the client’s financial situation into account.

What is the difference between consulting and advising?

Several differences separate the two types of outsourced financial monitoring, but the largest difference is in the length of the relationship.

Typically, consultants are brought in to address a specific problem during a particular time. The consultant reviews the situation and assesses all factors and leads the company toward a decision that is the healthiest for the business overall.

An advisor, on the other hand, works with a company on a long-term basis, pursuing pre-set goals from the initial relationship genesis. During a troubling time, an advisor might suggest that a company bring in a consultant to provide short-term relief.

Is financial consulting a good job?

Taking on the role of a financial advisor provides a range of opportunities that is available in few career fields. Successful financial advisors offer valuable advice to their clients. In return, they get virtually unlimited earning potential, a flexible work schedule, and their choice of professional specializations.

The career also has drawbacks. It takes considerable time and effort to build a client base, and steady attention to meet the regulatory requirements of the field. And it’s a high-stress job in the best of times.

Pros of a Financial Advisor Career

A successful financial advisor is handsomely compensated. The mean annual income for those in the field nationwide was $119,960 as of May 2021.1

But the advantages go well beyond compensation. Here are some of the primary benefits of becoming a financial advisor:

Offering Meaningful Advice

The chance to offer meaningful advice may not be the top reason young people begin their careers as financial advisors. But it can become the aspect of the job that is the most rewarding.

Consumers are often overwhelmed by the choices of investments or insurance vehicles that are available to them, and unable to determine which are appropriate for them and their families. The greatest role a financial advisor plays is to help clients make suitable decisions for a financially healthy future.

The successes of their clients are the successes of their financial advisors.

Investment Advisors vs. Financial Planners

Both investment advisors and financial planners are alike in that they help you with managing your assets, but the services they provide also differ in some notable ways. The table below breaks down some key differences between these two financial professionals:

Comparing Investment Advisors and Financial Planners

Investment Advisor
  • A financial professional or firm that offers advice, data and analysis to help clients pick and manage investments.
  • Have a fiduciary duty to put the financial interests of their clients first.
  • Must register with the state, and the Securities and Exchange Commission (SEC) if they manage more than $100 million in assets.
  • Advisors working with clients must hold the Series 65 license.
Financial Planner
  • Brokers, insurance agents, accountants and other qualified professionals generally assess the financial situation of clients and then create a plan to help them reach financial goals. Some also offer investment management.
  • Fee-only planners have a fiduciary duty to clients. Fee-based planners get additional compensation from commissions. Those who are commission-based are required to follow a suitability rule.
  • Regulated by the Financial Industry Regulatory Authority (FINRA), and the Securities and Exchange Commission (SEC) if they manage clients with more than $100 million in assets.
  • Could have multiple securities licenses to sell investment products, including Series 3, Series 6, and Series 7 exams.

As we point out in the table above, an investment advisor assists you with handling your investments and securities so that you’ll have a strong investment portfolio. These advisors first assess your financial situation and also determine your investment risk tolerance.

Following this, they propose an investing strategy specifically tailored to help you meet your goals. You can also give them permission to purchase investments for you. Investment advisors typically possess a lot of knowledge about market patterns, so if you’re planning on investing in stocks, mutual funds or other securities, they’ll be able to propose the most reasonable strategy in relation to your personal financial situation.

Financial planners similarly overlap with investment advisors in assessing the financial situation of clients and then proposing a plan to help them reach their goals. They can provide advice on budgeting, taxes, insurance and retirement. And some also offer management services for investors.

Financial consultant salary in United States

The average salary for a financial consultant is $77,536 per year in the United States.
The average salary for Financial Consultant is £44,107 per year in the London. The average additional cash compensation for a Financial Consultant in the London is £7,203, with a range from £2,078 – £24,965. Salaries estimates are based on 93 salaries submitted anonymously to Glassdoor by Financial Consultant employees in the London.

What skills do you need to be a financial adviser?

To be a financial adviser, you need a combination of technical and soft skills. Technical skills embody your industry knowledge, enabling you to improve the economic situation of your clients. They are unique to financial advisors, and you may have gained them in education or training. Soft skills enhance your technical skills, and you may have practiced them as you gained professional experience. They enable you to interact effectively with clients and coworkers and stay organized to produce quality work.

Client relationship skills

Financial advisers need client relationship skills to attract new clients and retain the clients they already have. Professionalism and positive relationship-building can encourage people to refer financial advisers to others in their network, which can help expand the advisor’s business and ultimately increase product sales.

Advisers must know how to keep their clients informed and foster trust. The relationships may also require emotional intelligence to remain mindful of a client’s financial situation.

Is being a financial consultant easy?

Putting it simply, being a financial advisor is HARD. If you’re looking for an easy career where you can just sit back and coast by, forget about it. It’s not for you. Another reason for the high turnover rate is the fact that many companies’ training programs haven’t adapted to the changing environment