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- Direct investmentsBrowse available investments
- RetirementAdd private markets to an IRA
Key Takeaways
- A financial advisor is a professional hired to provide financial advice to their clients.
- It is best for aspiring financial advisors to obtain a relevant undergraduate degree, including in business, finance, economics, mathematics, or accounting.
- A good financial advisor must know financial planning and concepts, possess knowledge of varying investment vehicles, and be detailed as well as a good listener and speaker.
Understanding how to navigate the road to becoming a financial advisor can put the person on a path toward their goal. It can also provide investors with insider knowledge that can improve their ability to gauge the expertise and credibility of advisors with whom they work. This blog demystifies financial advising and offers valuable insights and provides a roadmap to a financial advisor career.
What Is a Financial Advisor?
A financial advisor is a professional hired to provide financial advice to their clients. They can help investors and others focus on their short- and long-term goals and chart out a way to achieve them. Such goals can range from investing and buying real estate to saving and estate planning.
Beyond automated investing and robo advising, financial advisors specialize in areas such as retirement or investment risk management.
What Does a Financial Advisor Do?
While each financial advisor has their own way of functioning, there are core duties that are common to all. Those include:
- Assessing financial needs. Early on, the advisor will go over their client’s financial short-term and long-term goals.
- Developing personalized financial plans. The advisor will put together a plan based on the client’s goals and financial situation.
- Managing investments. They can research investment opportunities, including risk, and help clients make decisions on investments. Based on those decisions, the advisor can make investments for their client.
- Providing advice on a broad range of financial products. The advisor will explain the types of financial products and services they provide.
- Monitoring accounts. Every advisor is responsible for keeping track of clients’ accounts and determining whether modifications are needed to facilitate client life changes such as having children or getting married.
How Do I Become a Financial Advisor
Typically, financial advisors are self-employed or work in the finance or insurance sector. Entry usually requires a bachelor’s degree, and a master’s degree and certification may heighten opportunities for advancement.
Financial advising can be rewarding, both financially and personally. However, the path can be challenging and not everyone is suited for it. To be a good financial advisor, the person must study financial planning and concepts, possess knowledge of varying investment vehicles, and be detailed as well as a good listener and speaker. They should also have keen mathematical and analytical abilities.
How Long Does It Take to Become a Financial Advisor?
It takes time to become a financial advisor, including at least four years for a bachelor’s degree. After completing state licensing requirements, such as the Securities Industry Essentials exam, financial advisor prospects may explore additional certifications. The two most common include certified financial planner (CFP), which typically takes 18-24 months. Applicants must also have worked in the industry for at least three years.
The other common certification for financial advisors is certified public accountant (CPA), which requires a bachelor’s degree and at least two years of field experience.
Steps to Become a Financial Advisor
Earn a Bachelor’s Degree
It is wise to obtain a degree in a field that is relevant to financial planning. Those can include business, finance, economics, mathematics, or accounting, for example. Beneficial courses can include those in estate planning, risk management, taxes, and investments.
Complete an Internship & Find a Job
It is significantly valuable for the prospective advisor to gain hands-on experience through internships and assistant or associate financial planning positions at accounting or brokerage firms, banks, insurance companies, and credit counseling organizations.
To land that first job, networking, resume building, and gaining practical experience are paramount. For example, sites like LinkedIn can allow aspiring advisors to browse job postings, leverage connections to produce client leads, and connect with other industry professionals.
Get Certified
Becoming a CFP or CPA can help potential financial advisors be more competitive in the employment space.
Gaining CFP status also demonstrates to potential clients that the advisor is sufficiently qualified and experienced to provide accurate financial advice. Becoming a CPA adds accounting to the advisor’s skill set and allows the advisor to expand and diversify their clientele.
Pursue Additional Education
Continuous learning in financial advising is important, and smart, as it can help advisors maintain and even grow their client base. Such learning can include obtaining a master’s degree in finance or business administration. They can also obtain additional certification, such as a certified fund specialist, chartered financial consultant, chartered investment counselor, or personal financial specialist.
Understand Investing
Financial advisors should know about investing. In fact, they are expected to be able to educate clients and answer questions about investment options and prospective risks. They are also expected to be able to research investment opportunities, recommend investments, and invest based on client decisions.
Financial Advising and Alternative Investments
As investing in alternatives becomes more common, it is increasingly a subject for discussions with financial advisors. More and more, investors are seeking to take advantage of generally lower volatility, protection against inflation, tax favorability, and prospects for higher returns.
What are alternatives? Essentially any assets other than stocks and bonds. Its highly vetted opportunities — just 10% of deals ultimately make the platform — span real estate, art, private equity, private credit, and more.
With tools and guidance from professionals, Yieldstreet also makes it easy to craft a tailored private markets portfolio. And speaking of advisors, the platform has partnered with a private markets advisor that can produce an investment framework for each individual based on their personal goals.
In addition to the benefits mentioned up top, a key advantage of investing in alternatives is diversification. While every investment carries risk, building a modern portfolio of varying asset types is a strategy that can mitigate it. In fact, diversification is essential to long-term investing success. (While diversification may help spread risk, it does not assure a profit or protect against loss.)
Private Markets and Portfolio Diversification
Alternatives can be a good way to help accomplish this. Traditional portfolio asset allocation envisages a 60% public stock and 40% fixed income allocation. However, a more balanced 60/20/20 or 50/30/20 split, incorporating alternative assets, may make a portfolio less sensitive to public market short-term swings.
Real estate, private equity, venture capital, digital assets, precious metals and collectibles are among the asset classes deemed “alternative investments.” Broadly speaking, such investments tend to be less connected to public equity, and thus offer potential for diversification. Of course, like traditional investments, it is important to remember that alternatives also entail a degree of risk.
In some cases, this risk can be greater than that of traditional investments.
However, platforms like Willow Wealth provide curated access to private markets for individual investors.
Investors can get started with minimum investments as low as $5,000 for their first investment (subject to certain exceptions). Willow Wealth offers a curated selection of opportunities across multiple asset classes, ranging from individual investments to diversified funds and automated portfolio solutions. While these investments carry risk, they open the door to opportunities across real estate, private credit, private equity, and more.
Join more than 500,000 members and start investing in private markets today at willowwealth.com.
Summary
Having a clear, actionable pathway to becoming a financial advisor can help prospects reach their goal, keeping in mind the necessary steps, how long each will take, and exactly what such advisors do.
Investors who do not necessarily wish to become such an advisor can still enhance their ability to assess the credibility and expertise of advisors with whom they work.
What's Willow Wealth?
Willow Wealth enables you to build a private markets portfolio across real estate, private credit, private equity, and more. Our platform provides access to differentiated individual investments and diversified funds, as well as an automated investing solution that handles everything for you. Join more than 500,000 members and start investing today.
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View Willow 360 Managed Portfolios disclosures
Investments made on your behalf in a Willow 360 Managed Portfolio are highly speculative and entail substantial risks, including the fact that such investments are illiquid and subject to significant restrictions on transferability and redemption and that all or a substantial amount of the principal invested may be lost. No amount of diversification can eliminate such risks. Investment strategies such as the ones offered for Managed Portfolios may not be suitable for all investors, and potential investors must make an independent assessment of the appropriateness of any investment in light of their own objectives and circumstances.
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Willow Wealth Inc. has an engagement with Atomic Brokerage LLC (“Atomic Brokerage”), a registered broker-dealer and member of FINRA and SIPC, to bring you the opportunity to open a brokerage account. Brokerage services for customers of Willow Wealth Inc.are provided by Atomic Brokerage. Custodial and clearing services are provided to Atomic Brokerage by Pershing LLC. Technology services may be provided by AtomicVest. For more details about Atomic Brokerage, please see the Form CRS, Atomic Brokerage General Disclosures, and the Privacy Policy. Check the background of Atomic Brokerage on FINRA’s BrokerCheck. Fees such as regulatory fees, transaction fees, fund expenses, brokerage commissions and services fees may apply to your brokerage account.
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Willow Wealth Inc. is also the indirect owner of Willow Wealth Markets LLC, which is a broker-dealer registered with the SEC and a member of FINRA and SIPC. Despite its affiliation with Willow Asset Management LLC, Willow Wealth Markets LLC does not solicit, sell, recommend, or place interests in any underlying funds in the Managed Portfolios. All trades with respect to underlying funds in the Managed Portfolios will be effected through Atomic Brokerage LLC, an SEC-registered broker-dealer, with Pershing LLC acting as the custodian as appropriate.
View important footnotes related to performance, returns, duration, and other information about Willow Wealth investments
View important footnotes related to performance, returns, duration, and other information about Willow Wealth investments
1 Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. All securities involve risk and may result in significant losses.
3 "Annual interest," "Annualized Return" or "Target Returns" represents a projected annual target rate of interest or annualized target return, and not returns or interest actually obtained by fund investors. “Term" represents the estimated term of the investment; the term of the fund is generally at the discretion of the fund’s manager, and may exceed the estimated term by a significant amount of time. Unless otherwise specified on the fund's offering page, target interest or returns are based on an analysis performed by Willow Wealth of the potential inflows and outflows related to the transactions in which the strategy or fund has engaged and/or is anticipated to engage in over the estimated term of the fund. There is no guarantee that targeted interest or returns will be realized or achieved or that an investment will be successful. Actual performance may deviate from these expectations materially, including due to market or economic factors, portfolio management decisions, modelling error, or other reasons.
4 Reflects the annualized distribution rate that is calculated by taking the most recent quarterly distribution approved by the Fund's Board of Directors and dividing it by prior quarter-end NAV and annualizing it. The Fund’s distribution may exceed its earnings. Therefore, a portion of the Fund’s distribution may be a return of the money you originally invested and represent a return of capital to you for tax purposes.
5 Represents the sum of the interest accrued in the statement period plus the interest paid in the statement period.
6 The internal rate of return ("IRR") represents an average net realized IRR with respect to all matured investments, excluding our Short Term Notes and Structured Notes programs, weighted by the investment size of each individual investment, made by private investment vehicles managed by Willow Asset Management LLCfrom July 1, 2015 through and including March 31, 2025, after deduction of management fees and all other expenses charged to investments.
7 Investors should carefully consider the investment objectives, risks, charges and expenses of the Yieldstreet Alternative Income Fund before investing. The prospectus for the Yieldstreet Alternative Income Fund contains this and other information about the Fund and can be obtained by contacting us or by referring to www.yieldstreetalternativeincomefund.com. The prospectus should be read carefully before investing in the Fund. Investments in the Fund are not bank deposits (and thus not insured by the FDIC or by any other federal governmental agency) and are not guaranteed by Willow Wealth or any other party.
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9 Statistics as of the most recent month end.
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