Financial Advisor Training Programs: A Comprehensive Guide

If you’re looking to become a financial advisor, you’re likely aware that this profession requires extensive training and education. A financial advisor must have a deep understanding of financial markets, investment vehicles, tax laws, and estate planning strategies. For those who are up for the challenge, however, a career as a financial advisor can be highly rewarding.

In this guide, we’ll dive into everything you need to know about financial advisor training programs. We’ll cover what these programs entail, how long they take, and what types of certifications or licenses are required to practice as a financial advisor. Let’s get started!

Why Attend a Financial Advisor Training Program?

First and foremost, attending a financial advisor training program is necessary if you want to become licensed and certified to practice as an investment professional. In order to work with clients’ funds and provide investment advice professionally, most states require that you pass certain exams and obtain appropriate credentials.

Beyond the licensing requirements though, attending a financial advisor training program is valuable because it provides comprehensive education on all things finance-related. You’ll learn about various types of investments such as stocks vs. bonds vs. mutual funds; how taxes can impact your investments; strategies for retirement planning; estate planning tools such as trusts and wills; the importance of diversification in portfolios; risk management techniques; and much more.

To put it simply: even if you could slide by without attending a training program (unlikely), doing so would severely limit your knowledge base – putting both you and your potential clients at risk.

What Are the Types of Financial Advisor Training Programs?

There are multiple types of programs available for individuals who want formal education in finance:

Bachelor’s Degree in Finance

A bachelor’s degree in finance is typically completed over four years at an accredited university or college. This type of program includes courses on accounting principles, economics theory, business law & ethics, and management concepts. A degree in finance is required for most entry-level financial analyst positions.

Master of Business Administration (MBA)

An MBA is a graduate-level program that typically takes two years to complete. This type of program covers topics such as accounting, business strategy, economics, finance, leadership skills, and marketing. Often used to advance one’s career, an MBA can provide more opportunities for high-paying roles in finance.

Accredited Financial Counselor (AFC) Program

The AFC designation is offered by the Association for Financial Counseling & Planning Education (AFCPE). This program covers topics such as budgeting & saving principles, credit management skills, debt reduction strategies, and basic investment concepts. This program is best suited for those looking to counsel individuals on money management rather than providing specific investment advice.

Certified Financial Planner (CFP) Program

The CFP designation is offered by the Certified Financial Planner Board of Standards. The program requirements include completion of undergraduate coursework; passing the CFP exam after qualifying work experience; completing a comprehensive background check; and following strict ethical standards set forth by the board. This program prepares students to be able to offer holistic financial plans that consider investments, tax planning strategies, insurance needs, retirement planning goals, estate planning considerations & more.

Series 7 Exam

The Series 7 Exam is not necessarily a training program but rather a requirement before becoming licensed by the Financial Industry Regulatory Authority (FINRA). The exam applies to "general securities representatives" who are involved with buying and selling securities on behalf of their clients. It is recommended to study for this exam through a formal education course or self-study materials.

How Long Does it Take to Complete a Training Program?

The length of time it takes to complete a financial advisor training program depends on what type of degree or certification you’re pursuing:

• Bachelor’s Degree: Typically requires four years full-time.
• MBA: Typically requires at least two years full-time.
• AFC Program: This program takes place over several weeks, with some online course work and in-person training sessions.
• CFP Program: This program requires a bachelor’s degree or equivalent, plus three years of qualifying work experience. It is typically completed within one to three years.
• Series 7 Exam: Some people study for this exam on their own for a few months while others take a formal course that lasts six months.

Keep in mind that it’s important to not rush through any of these programs. If you want to become a successful financial advisor, you need to have the most comprehensive education possible.

What Certification or Licenses are Required?

The certifications or licenses required will vary depending on what type of financial advice you’re planning to provide, as well as which state(s) or country you’ll be practicing in. Here are the main certifications/licenses that financial advisors pursue:

Registered Investment Advisor (RIA)

To legally provide investment advice, an individual has to register as an RIA with Securities and Exchange Commission (SEC) or be licensed by the state they practice in. RIAs have a fiduciary duty to act in their client’s best interest; unlike brokers who often receive commissions based on sales they make.

Series 6 License

A Series 6 license allows individuals to sell mutual funds and variable annuities. These securities licenses are necessary if generating commission is one of your goals as a financial advisor.

Series 63 License

The Series 63 license is often paired with the Series 6 license, which means it authorizes individuals to solicit orders for securities for clients in their state.

Certified Financial Planner (CFP)

We mentioned this certification earlier as one that can come from completing specific coursework and examinations. In addition to preparing students for financial planning roles, being certified can strengthen job applications and indicate credibility when prospecting for clients.

Chartered Financial Analyst (CFA)

The CFA designation is considered to be one of the most prestigious financial analyst designations in the world. It requires passing three rigorous exams covering topics such as economics, quantitative analysis & statistical techniques, corporate finance principles, and investment management concepts.

How Much Does a Financial Advisor Training Program Cost?

Again, the cost of training can vary widely depending on what type of program you pursue. Here are some estimates for a few common financial advisor training programs:

• Bachelor’s Degree: $10,000-$40,000/year
• MBA: $50,000-$100,000 over two years
• AFC Program: $200-$500 for course prep; $1,500-$3k for course attendance (online or in-person)
• CFP Program: varies based on institution and program format– expect to pay anywhere from $2k to over $6k.
• Series 7 Exam: This exam costs roughly $250 to take.

While these numbers may seem daunting at first glance, keep in mind that pursuing education and licensure is an investment. It may not have a direct return immediately but it will likely pay off in the long run if you use the skills learned effectively.

Conclusion

In conclusion, becoming a financial advisor requires extensive education and training. Pursuing formal education through an accredited program can help individuals attain both certifications/licenses necessary for practicing while also gaining a strong foundation of finance-related concepts that they’ll end up applying on the job. The length and cost of these programs can vary significantly based on which type you choose; however investing in your future by pursuing these programs can provide more opportunities down the road as well as potentially higher earning potential than without them.