How to Become a Financial Advisor in the UK

How do you become a financial advisor in the UK? A financial advisor is a professional who helps people deal with their financial problems. It is a highly competitive industry. Financial advisors need to have a Statement of Professional Standing (SPS) from an accredited body.

The demand for financial advisors in the UK is increasing as people seek ways of adapting to the new post-Brexit environment. People turn to advisors when they want to know how to earn more money, manage their funds, and grow their wealth.

Who is a Financial Advisor?

A financial advisor is a professional who helps people manage their finances. In most countries, advisors must be registered by financial regulators because of the sensitive information they offer. In the UK, these advisors must be registered by the Financial Conduct Authority (FCA).

A financial advisor in the UK needs to be someone who is educated in finance. They also need to be experienced in the financial sector. Most importantly, they need to have a Statement of Professional Standing (SPS) from an accredited body. Financial advisors work in various organizations. There are advisors who work in banks like HSBC and Barclays. There are others who work in consulting companies like Grant Thornton and KPMG. Other financial advisors work in investment companies like Vanguard, Blackrock, and Standard Investment. Other advisors work in financial advisory companies. These are companies that specialize in providing financial advice. Other financial advisors in the UK work in their own practices.

Typical Duties by Financial Advisors in the UK

Financial advisors offer a number of services in the UK. Some of the most important work they help their customers with are:

• Investment decisions. Investment financial advisors in the UK help customers analyse and select the best invest opportunities.
• Estate planning and succession. They help customers plan their estate well to prevent conflict and wastage.
• Money management. They help customers manage their money well. This includes dealing with debt.
• Retirement planning. Financial advisors help people to prepare for retirement well.
• Insurance. Many people don’t know much about insurance. Advisors can help you decide the best insurance to take.
• Mortgage planning. Taking a mortgage is a big commitment. An advisor can help you select a good mortgage.
• Tax. Financial planners help their clients pay the least amount of taxes possible.

Is a Financial Advisor a Good Job in the UK?

On the positive side, Financial advisors often enjoy a high earning potential, particularly those with experience or catering to high-net-worth clients. Moreover, the profession allows you to make a tangible difference in people’s lives by aiding them in achieving their financial goals. Continuous learning opportunities abound in the ever-evolving financial industry. Additionally, depending on the employer and clientele, financial advisors may benefit from flexibility in their work schedules.

However, there are challenges to consider as well. Financial markets’ volatility and the weight of ensuring clients’ financial security can lead to significant stress levels for advisors. Building a client base requires substantial time and effort, often translating into long working hours, especially in the initial stages of one’s career. Furthermore, some roles in financial advising rely on sales performance for income, introducing potential income insecurity. Moreover, the path to becoming a financial advisor involves obtaining specific qualifications and passing exams.

What is a Financial Advisor Salary in UK?

Financial advisors’ salaries in the UK can vary significantly based on their experience and the clientele they serve. Here’s a rough breakdown:

• Trainee or entry-level: £22,000 to £33,000 annually
• Qualified advisor: £30,000 to £45,000 annually
• Senior advisor (with an average client base): Approximately £60,000 annually
• Wealth manager/private client advisor: Over £100,000 annually

It’s worth noting that these figures are general estimates, and actual salaries may fall outside these ranges. For example, job listings often advertise wider salary brackets, such as £50,000 to £150,000.

How to Be a Financial Advisor

The financial advisory is a highly competitive industry. This is because people come from around the world looking for these services in the UK. As you may know, London is the financial capital of the world. As with all careers, you need to be passionate about the finance industry. This is simply because you want to enjoy what you do on a daily basis. Unlike other fields, the financial advisory field is very wide. By this, we mean that you don’t need to have a degree in business or finance to become a successful advisor.

However, having a background in the sector will be an added advantage. For example, having a degree in finance will help you recommend stocks, mutual funds, or index funds to your clients. Also, having such a degree will help you find a job in one of the leading financial advisory firms in the UK. Most importantly, being certified in a variety of fields will help you standout.

You can take a course like Financial Advisor Course level three and level four. The courses you take should be accredited and accepted by the Financial Conduct Authority (FCA). Other courses or memberships that will help you standout as a financial advisor are:

• Association of Chartered Certified Accountants (ACCA)
• Chartered Institute of Auditors (CIA)
• Institute of Financial Accountants (IFA)
• Chartered Insurance Institute (CII)
• Chartered Institute for Securities and Investments (CISI)
• CFA Institute
• Chartered Alternative Investment Analysis Association (CAIA)

You can read more about these memberships and qualifications in this handbook book by the FCA.

Receiving these memberships and certifications will help you become a better financial advisor. They will also help you get a job in one of the leading financial advisory firm. There are two main routes to becoming a good financial advisor in the UK. First, you can decide to be employed in a financial advisory company. Second, you can decide to set your independent financial advisory company.

The benefit of registering your own company is that you will be your own boss and make more money. You will also be in a position to employ more advisors. You can start the firm from scratch. Alternatively, you can use a company like Quilter Financial Planning to start your own company. Quilter is ranked as the best financial advisory firms in the UK by the Financial Times. Another option is to start a franchise that offers financial advisory services. You can use a company like Infinity Business Growth Network to achieve this.

How Long Does It Take to Become a Financial Advisor in the UK?

In the UK, the duration to become a financial advisor varies depending on the chosen path. The primary qualification, such as the Diploma for Financial Advisers (DipFA), typically requires approximately nine months for completion, as stated by unbiased.co.uk. This program can be pursued either full-time or part-time. Following the acquisition of this qualification, individuals may seek employment opportunities.

However, securing a financial advisor role without prior experience can be challenging. In such cases, it may be necessary to first gain relevant experience, potentially through roles in customer service or administration within a financial firm, as noted by unbiased.co.uk. Consequently, the overall timeframe could extend beyond the initial nine months required for qualification attainment.

Several additional factors also influence the duration of the process:

• Apprenticeship: Another pathway to becoming a financial advisor involves undertaking a financial advisor apprenticeship. These programs combine practical work experience with qualification learning, as highlighted by the National Careers Service. However, apprenticeships typically take longer to complete compared to standalone qualification programs.
• Degree: While not obligatory, holding a relevant degree in finance, business management, or accountancy can offer advantages in the field of financial advising. Incorporating a degree program into one’s educational journey would lengthen the overall timeline for becoming a financial advisor.

Best Financial Advisors in the UK

Before we look at how you can be a financial advisor in the UK, let us look at some of the best-known and best-rated financial advisor companies in the UK.

• Close Asset Management – This is a company established in 1872. It offers multiple financial advisory services like investment advice and retirement planning.
• The Fry Group – Established in 1878, the company offers financial advice services to individuals and companies.
• The Progeny Group – The company provides diverse financial services to individuals and companies. Services include asset management and financial planning.
• The Openwork Partnership – The Openwork provides financial services like real estate planning and mortgage planning to companies and individuals.
• Hazlewoods Financial Planning – The company provides various financial services like tax and accounting to people and companies.

There are hundreds of financial advisory companies in the UK. You can check at a comprehensive list by the Financial Times here.

Summary

Becoming a certified financial advisor in the UK can be a highly rewarding job or occupation. As an advisor, you should always work in accordance to the laws set by the FCA. You should also have high moral standards, as this will help you build relationship with your clients. Additionally, you should continue learning about the finance industry because things are always evolving.