How to Become a Qualified Financial Advisor in India

A career as a financial advisor is perfect for people who are passionate about accounting and business. This article will assist you with the role and offer a thorough guidance on how to become a Qualified Financial Advisor. 

Who Is a Financial Advisor?

A financial advisor is an expert who helps clients reach their financial objectives by providing guidance and recommendations.  Examples of advice include creating client budgets, choosing investments and recommending tax-advantaged accounts for retirement savings.

While independent advisers establish advisory businesses, the majority of financial advisors work for financial institutions such as banks and insurance companies.

Consider pursuing a career as a financial advisor if you enjoy researching investing choices, sharing your knowledge and helping others make informed financial decisions.

What Does a Financial Advisor Do?

A financial advisor’s duties can vary based on their role and the company they work for. A financial advisor’s regular responsibilities include the following. 

• Conducting market research to find trends.
• Visiting clients to learn about their financial situations.
• Bringing in new clients for their business.
• Advising individuals on investing strategies.
• Helping clients in understanding the services they offer.
• Educating clients with tax and insurance matters. 
• Keeping track of client accounts.
• Focusing on specific financial issues, such retirement planning.
• Fulfilling compliance requirements.

A financial advisor guides clients in areas such as retirement, investing, taxes and financial planning which will help them make well-informed financial decisions.

• Financial Planning: Developing a thorough financial strategy that will suit the client’s goals. This includes saving, budgeting and making plans for both long and short-term goals.
  

• Retirement Planning: This includes choosing retirement accounts and figuring out withdrawal plans, as well as developing strategies for clients to save and manage enough money for a comfortable retirement.

• Tax Planning:  Providing guidance on reducing taxes while complying to tax regulations through practices that include tax-efficient investment options, credits and deductions.
• Investment Advisory: This includes making investment recommendations based on the objectives, timespan and risk tolerance of clients; monitoring or offering advice on portfolio performance for long-term growth.

What Are the Services Offered by Financial Advisors?

Since there isn’t a single model that works in every case, it helps to understand the standard services that numerous professions offer. 

A group of knowledgeable experts offer financial consulting services on how to manage funds and assets efficiently. Certified financial planners, financial advisors, investment advisors and registered public accountants are among the people who offer financial advisory services.

The top financial advisors will play a significant role in your future planning and help you in developing a financial health road map. To get some interesting insights, you should keep an eye out for the following services provided by financial advisors: 

• Investment advice: Financial Advisors can help you select investments that fit your goals and risk tolerance. They can also help you maintain your path or make strategic changes in case of unforeseen financial emergencies.
• Debt management: If your debts are hindering you from leading a healthy life, a Financial Advisor can create plans to pay off your current debt and help you avoid debt in the long run. It’s easier to save money when you have less debt.
• Budgeting: Financial advisors can help you develop ways to save and spend money so you can achieve your goals. Be it budgeting for a holiday or purchasing your dream home.

What Are the Skills Needed To Become a Financial Advisor?

The following are some essential financial advisor skills that will give you a better idea of how to become a licensed Financial Advisor:

• Critical thinking

A Financial Advisor must have critical thinking skills to predict trends, assess the benefits and drawbacks of a given course of action and make necessary adjustments to match the client’s financial goals and capabilities. The ability to think is essential for a profession like that of a Financial Advisor since it ensures that you find the best outcome for an issue.

• Research skills

Research skills allow one to define a problem, find resources to address it, check the usefulness and quality of those resources and then choose the best course of action. People who want to work as Financial Advisors must have the ability to do extensive research on the most influential economic applications and theories.

• Good Communication Skills 

A financial advisor must have good communication skills in order to understand clients’ needs, simplify complicated financial ideas and build trust. They must listen carefully, raise relevant questions and provide solutions in an understandable and convincing manner.

• Wealth Management Skills

Wealth management skills involve understanding how to increase, safeguard and maintain wealth over time.  This includes understanding risk management, estate planning, tax optimisation and investment strategies, which empowers advisors to help clients handle complicated financial choices and customize solutions to meet their unique goals.

Why Should You Become a Financial Advisor?

One of the primary objectives  of certifications is to facilitate career advancement. In India, there were roughly 1400 SEBI-registered investment advisors and 2000 Certified Financial Planners (CFPs) as of 2021, suggesting that this sector has potential for further growth. On a global scale, as of December 31, 2021, there were 2,03,312 CFP professionals.

In India, eight crore individuals pay taxes but only a part of that number has good Financial Advisors to help them with the essentials. The large number of taxpayers indicates that there is sufficient job stability in this field and its scope will only grow in the future.

Benefits of Becoming a Financial Advisor

1. Earning Potential: Financial advisors often have high earning potential through commissions, fees and bonuses, especially as their client base grows.
2. Job Flexibility: Many financial advisors have a high level of work-life balance because they are able to work independently, set their own schedules or even start their own practices.
3. Helping Others: Advisors play an important role in helping clients achieve financial security, which can be highly rewarding, both personally and professionally.
4. Career Growth: The finance sector is dynamic, offering opportunities for growth into specialised professions such as wealth management or portfolio management, in addition to opportunities for continuous learning.
5. Job Security: Since people and businesses are always in need of financial guidance, there is a steady need for certified financial advisors, which guarantees long-term employment opportunities.

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Challenges of Being a Financial Advisor

1. Client Acquisition: It can be difficult and time-consuming to establish and retain a solid client base, especially in a competitive market.
2. Market Volatility: Managing clients’ investments during market downturns can be challenging for advisors and result in difficult performance discussions.
3. Long Hours: Financial advisers may have to put in long hours, including weekends and evenings, depending on their client base and firm in order to fulfill client requests or hit sales goals.
4. Regulatory Compliance: It can be time-consuming and legally difficult for financial advisors to work through complex regulatory settings as well as staying updated on laws and industry standards.
5. Pressure to Perform: There’s constant pressure to deliver results, which can be stressful, especially when clients’ financial well-being is at stake. 

How Much Does a Financial Advisor Earn?

After earning your certification, you will be most eager to learn how much money you can make as a Financial Advisor. International degree certifications increase your pay and qualify you to work for the top brands in the industry.

Financial Advisors can earn 3 LPA as freshers, 4-6 LPA in the mid-level position and above 10 LPA in senior positions (depending upon the type of financial advice, planning, client size and the project timespan).

A CFP’s average yearly remuneration is approximately 3.9 LPA, though this can vary based on whether they work for themselves or for reputable banks or financial institutions where they can earn much more.

What Degree is Required to Become a Financial Advisor in India?

In India, a bachelor’s degree in any field is normally the basic criteria to work as a financial advisor. Nonetheless, a degree in Business Administration, Finance, Commerce or Economics can offer a strong foundation for understanding accounting, investing strategies and financial markets.

Understanding the Necessary Qualifications for Financial Advisors in India

Becoming a financial advisor in India requires a mix of formal education, certifications and practical experience. While a degree laying the framework, certificates and regulatory registration are important for reputation and career growth.

Best Degree Major for Financial Advisors in India

1. B.Com (Bachelor of Commerce): This is one of the most popular degrees for aspiring financial advisors.  It offers a strong foundation in economics, taxation, accounting and financial management
2. BBA/BBM (Bachelor of Business Administration): This degree focuses on broader business management skills but also covers topics in finance, marketing and economics, which of course makes it a good choice for financial advisory careers.
3. B.A. Economics: A degree in economics gives deep insights into financial markets, government policies and the economy, which are valuable for financial advising.
4. BFSI (Banking, Financial Services and Insurance): A specialised degree in BFSI can offer more direct exposure to financial advising, asset management and investment planning.

How to Become a Financial Advisor in India (Actionable Guide)

1. Obtain a Bachelor’s Degree

Begin by pursuing a bachelor’s degree in business administration, commerce or an equivalent field. This degree is foundational and helps you understand the basic concepts of finance, accounting, economics and business operations.

2. Pursue Relevant Certifications

A degree gives you a solid foundation but certifications add credibility and specialised knowledge to your profile. Some of the most essential certifications in India are:

• Certified Financial Planner (CFP): Both internationally and in India, the CFP certification is highly regarded. It focuses on retirement planning, estate planning, investment strategies and personal financial planning. You must complete the training program and pass the tests in order to become a certified financial planner.
• Chartered Financial Analyst (CFA): The CFA is a globally recognised qualification with an emphasis on financial ethics, portfolio management and investment analysis. It works best for people who want to work in more complex financial advisory professions and requires completing three test levels.
  

3. Register with SEBI (Securities and Exchange Board of India)

In India, you must register with SEBI as a Registered Investment Advisor (RIA) in order to legally provide financial advising services. SEBI regulates financial advisors to maintain transparency, ethics and client protection.

• You must fulfill additional eligibility requirements set by SEBI and pass the NISM (National Institute of Securities Markets) exam for investment advisors in order to register.
  

4. Apply for Jobs or Start Your Own Practice

You can begin working as a financial advisor for a reputable company or on your own after completing your degree, earning a certification and registering with SEBI. Here’s how:

• Apply for Jobs: Look for opportunities with banks, wealth management firms, insurance companies or investment advisory firms.
• Start Your Own Practice: If you prefer working independently, you can start your own financial advisory business. However, you’ll need to build a client base, market your services and build trust to succeed.

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Conclusion

Your job as a Financial Advisor will go beyond closing sales and managing investment portfolios. You will also need to include marketing, compliance, education and prospecting as a part of your daily routine. Incorporating these tasks into your schedule can determine your success in the business.

If you’re looking to build a career as a Financial Advisor, you can sign up for the CFA (Chartered Financial Analyst) course to get a gist on your journey. Visit Zell Education for more information on the course. 

FAQs on Become a Qualified Financial Advisor (QFA)

What qualifications do you need to become a Financial Advisor?

A Bachelor’s degree is the basic criteria required to pursue a career as a Financial Advisor. Someone specialising in financial management and accounting can also take up this career.

Do Financial Advisors need a license in India?

According to the regulations, a person cannot function as or claim to be a financial advisor without first acquiring a SEBI registration certificate. Registration is mandatory for Financial Advisors.

How can I become an IFA in India?

Yes. A qualified Financial Advisor expects more than 3.9 LPA in their early-level career and they can make above 6 LPA with more than three years of work experience. The possibilities are endless for those with over 10 years of experience.

Is a Financial Advisor a good career in India?

Yes. A qualified Financial Advisor expects more than 3.9 LPA in their early-level career and they can make above 6 LPA with more than three years of work experience. The possibilities are endless for those with over 10 years of experience.

Partham Barot is an ACCA-certified professional. showcasing his expertise in finance and accountancy. he’s revolutionising education by focusing on practical, real-world skills. Partham’s achievements underscore his commitment to elevating educational standards and empowering the next generation of professionals.