Financial analysts and personal financial advisers

			Check out another job
			Search a job category Architecture   - Building architects   - Landscape architects Art and design   - Artists   - Designers Computers   - Computer programmers   - Computer and information       systems managers   - Software engineers   - Support specialists and       system administrators   - Statisticians Educators   - Administrators and principals   - Counselors   - Post-secondary teachers   - Elementary, middle school       and high school teachers Engineers   - Engineers   - Aerospace   - Agriculture   - Biomedical   - Chemical   - Civil   - Electrical   - Environmental   - Industrial   - Mechanical   - Nuclear Entertainment and sports   - Actors, producers and directors   - Athletes, coaches and officials   - Dancers and choreographers   - Musicians Financial   - Accountants   - Economists   - Financial advisors   - Securities, commodities and       financial services sales agents Health care   - Chiropractors   - Dentists   - Dietitians   - Occupational therapists   - Optometrists   - Pharmacists   - Physical therapists   - Physicians and surgeons   - Psychologists   - Registered nurses   - Speech pathologists   - Veterinarians Legal   - Judges   - Lawyers Media and communications   - Advertising and public       relations managers   - Broadcast announcers   - News analysts, reporters       and commentators   - Photographers   - Public relations specialists   - TV, camera and film operators   - Writers and editors Office / elected officials   - Human resources, training and       labor relations managers   - Secretaries and       administrative assistants   - Top executives and       elected officials Sales   - Loan officers   - Purchasing managers   - Retail salespeople   - Real estate agents Scientists   - Biological   - Chemists   - Environmental Service   - Counselors   - Firefighters   - Police officers and detectives   - Social service workers Travel   - Flight attendants   - Pilots   - Travel agents

Financial analysts and personal financial advisers provide investment analysis and guidance to businesses and individuals to help them with their investment decisions. They gather financial information, analyze it and make recommendations.

Financial analysts, also called security analysts and investment analysts, work for banks, insurance companies, mutual and pension funds, securities firms and other businesses helping the company or their clients make investment decisions. They read company financial statements and analyze commodity prices, sales, costs, expenses and tax rates to determine a company's value and project future earnings. They often meet with company officials to get better insight into a company and determine managerial effectiveness. Usually financial analysts study an entire industry, assessing current trends in business practices, products and industry competition. Financial analysts use spreadsheet and statistical software packages to analyze financial data, spot trends and develop forecasts. Based on their results, they write reports and make presentations, usually making recommendations to buy or sell a particular investment or security.

Some financial analysts, called ratings analysts, evaluate the ability of companies or governments issuing bonds to repay their debt. Other financial analysts perform budget, cost and credit analysis.

Personal financial advisers, also called financial planners or financial consultants, use their knowledge of investments, tax laws, insurance and real estate to recommend financial options to individuals based on their short-term and long-term goals. Issues they address include retirement planning, estate planning, tax issues, funding for college and general investment options. Some advisers manage the client's investments.

Financial analysts may face long hours, frequent travel and deadline pressure. Personal financial advisers usually work standard business hours, but they schedule meetings with clients in the evenings or on weekends. Many teach evening classes or put on seminars to bring in more clients.

Training and qualifications

A college education is required for financial analysts and strongly preferred for personal financial advisers. Most companies require financial analysts to have at least a bachelor's degree in business administration, accounting, statistics or finance. Coursework in statistics, economics and business is required, and knowledge of accounting policies and procedures, corporate budgeting and financial analysis methods is recommended. A master's degree in business administration is desirable. Advanced courses in options pricing or bond valuation and knowledge of risk management are suggested.

Employers usually do not require a specific field of study for personal financial advisers, but a bachelor's degree in accounting, finance, economics, business, mathematics or law provides good preparation. Courses in investments, taxes, estate planning and risk management are helpful.

Mathematical, computer, analytical and problem-solving skills are all essential qualifications for financial analysts and personal financial advisers. Good communication skills are necessary for presenting complex financial concepts and strategies in easy-to-understand language. Self-confidence, maturity and the ability to work independently are important.

Certification, although not required, can enhance professional standing. Financial analysts may receive the title Chartered Financial Analyst (CFA). Personal financial advisers may obtain a Certified Financial Planner (CFP) or Chartered Financial Consultant (ChFC) designation.

A license is not required to work as a personal financial adviser, but advisers who sell stocks, bonds, mutual funds, insurance or real estate, may need licenses to perform these additional services. Also, if legal advice is provided, a license to practice law may be required.

Job outlook

Increased investment by businesses and individuals is expected to result in faster-than-average employment growth of financial analysts and personal financial advisers through 2010. Both occupations will benefit as baby boomers save for retirement and a generally better educated and wealthier population requires investment advice.

With deregulation of the financial services industry, many banks are now entering the securities brokerage and investment banking fields and will increasingly need financial analysts.

The globalization of the securities markets and complexity of many financial products also will increase the need for analysts and advisers to help investors make financial choices. Continuing business mergers and acquisitions will require financial analysts. But in the field of investment banking, the demand for financial analysts may fluctuate because of sensitivity to changes in the stock market. And further consolidation in the financial services industry may eliminate some financial analyst positions, somewhat dampening overall employment growth.

Earnings

Financial analysts and personal financial advisers held 239,000 jobs in 2000; financial analysts accounted for about six in 10 of the total. One in four financial analysts works for security and commodity brokers, exchanges and investment services firms.

Median annual earnings of financial analysts were $52,420 in 2000. Median annual earnings of personal financial advisers were $55,320 in 2000.

Related links

For information on a career in financial planning:

The Financial Planning Association, 1700 Broadway, Suite 708, Denver, CO 80290.

For information about the Certified Financial Planner certification:

The Certified Financial Planner Board of Standards, 1700 Broadway, Suite 2100, Denver, CO 80290-2101.

For information about the Chartered Financial Consultant designation:

The American College, 270 South Bryn Mawr Ave., Bryn Mawr, PA 19010.

For information on about the Chartered Financial Analyst designation:

Association of Investment Management and Research, P.O. Box 3668, 560 Ray C. Hunt Drive, Charlottesville, VA 22903.

Adapted from the Labor Department's Occupational Outlook Handbook.