Financial advisors assist individuals with investments, taxes, insurance and other financial transactions. They help their clients lay out both long-term and short-term financial plans. Financial advisors can be either generalists or specialists in certain types of finances like retirement and estate planning. Financial advisors who are starting out must develop a client base. As the size of their client base increases so should their income.
Nationwide, financial advisors in the 10th percentile of the pay range earned $16.25 an hour or $33,790 a year in 2009, according to the U.S. Bureau of Labor Statistics. Though starting pay will vary widely depending on how good of a salesperson the advisor is. Financial advisors who are starting out will generally be at the low end of the pay range for the profession and then move up as they gain more experience.
Pay by Industry
The top-paying industries for starting financial advisors in 2009 were Insurance Carriers ($43,320 a year), Insurance Carriers and Related Activities ($36,270 a year) and Other Financial Investment Activities ($35,690 a year). All of the other industries in which financial advisors worked paid less than $35,000 a year in the 10th percentiles. The industries that hired the most financial advisors were Securities, Commodity Contracts, and Other Financial Investments and Related Activities; Other Financial Investment Activities and Securities and Commodity Contracts Intermediation and Brokerage. All of the other industries employed less than 10,000 financial advisors each.
Pay by State
The highest-paying states for starting financial advisors were New York ($51,730 a year), Massachusetts ($48,840 a year), Connecticut ($43,640 a year), Washington D.C. ($43,160 a year), Delaware ($42,060 a year) and Rhode Island ($41,270 a year). All of the other states had salaries under $40,000 a year in the 10th percentile. The best states for employment as a financial advisor were New York, California, Florida and Texas. These states employed more than 11,000 financial advisors each.
The number of financial advisors is expected to grow by 30 percent between 2008 and 2018, according to the U.S. Bureau of Labor Statistics. A lot of the growth is predicted to be in response to the baby boomer generation retiring and needing financial advice. Despite the fast growth in the profession, the Bureau of Labor Statistics notes that competition will remain keen for the entry-level positions. There’s also a good chance that although you may start out employed by a company, you will wind up self-employed. In 2009, 29 percent of the 208,400 financial advisors in the country were self-employed.