Financial advisors meet with current and prospective clients to assess their financial situations and create plans for their futures. When not in front of clients, they’re often preparing for client meetings, staying up to date on market events, working with other professionals and marketing their services.
Financial advisors spend the majority of their time meeting with and talking to investors. Clients are “the engine of the business,” says John Harris, managing director of South Florida-based Coral Gables Trust Company. “We make sure our clients are getting what we promise and that they’re satisfied.”
To this end, the first and most important thing he does every day is to address any current or prospective client needs. “You always want to differentiate yourself in this business,” especially if you’re a smaller firm, he says. Responsiveness is one way to do that, as is flexibility in solutions.
“As retirement planners, we want to be there for them throughout the remainder of their lives, and it’s important for me to make sure I’m not just the guy who handles their money,” says Andrew Wood, a retirement planning advisor with Daniel A. White & Associates in Middletown, Delaware.
There’s a common misconception that financial advisors spend all their time studying investments. While investment planning is an integral part of the job, it’s often not the central part of what a financial advisor does.
Sonya Ranker, a certified divorce financial analyst and certified financial planner at Questmont Strategic Wealth Advisors, estimates 30% of her time is specific to investments. “The rest of the time is more advanced planning and goal strategizing,” she says. “I review tax returns as much as I review investment statements.”
Beyond investment planning, here is what financial advisors do:
— Meeting with clients.
— Background planning for client meetings.
— Staying up to date on market events.
— Working with centers of influence.
Read on for more information on each of these financial advisor job duties.
Meeting With Clients
Recent limitations on in-person contact have changed the way advisors may meet with their clients. Being an essential business has only increased the need for advisors and their firms to be adaptable. Virtual communication has improved dramatically in the industry, Harris says. “In a post-COVID world, advisors have more ways to have material dialogue and interaction with clients, prospects and other advisors.”
While the means of communication may have changed from in-person to virtual, the importance of communicating at a high level and promptly with clients has not changed, Harris says.
At Coral Gables Trust Company, for instance, by quickly embracing virtual meeting platforms such as Zoom and Microsoft Teams at the onset of the COVID-19 pandemic, employees could keep all their offices open and continue providing the support their clients needed. Harris adds that clients have enjoyed having the option to meet virtually or in person.
Whether advisors meet their clients online or in the office, the structure of a client meeting remains largely the same.
Client meetings are often spent “learning about their situations and putting together a plan of action to improve their situation and help them to reach their goals,” Wood says.
With existing clients, his goal is to uncover anything that’s changed in their situation and if adjustments need to be made to their financial plans. For prospects, he spends “a great deal of time just learning about their unique situations, what they’re looking for and what they need,” he says.
It always comes down to the client’s goals, Ranker says. Their financial goals will shape the trajectory of the meeting and the background planning that goes into preparing for it.
Background Planning for Meetings
Background planning for meetings is where the investment analysis often comes into play. Preparation involves running diagnostics on client plans and researching investment solutions.
“We also spend time writing articles and creating materials that can be used during client meetings or presentations,” says Allison Vanaski, a senior financial planner and vice president of investments at Arcadia Wealth Management in Smithtown, New York.
Financial advisors are as much educators as they are advisors.
The biggest role Ranker plays on a day-to-day basis is managing client behaviors and perspectives. “Most of the information people get is from the news,” she says. “They get wrapped up in the emotion of what’s happening on a day-to-day basis, and it separates the money and the performance from their actual life goals.” It falls to advisors to educate their clients about market cycles and volatility.
Following Market Events
Staying updated on market events is an essential part of the job. When not working directly with clients or other team members, Vanaski is often reading up on current events and news that could impact her clients or researching better ways to serve those clients. She averages two face-to-face client meetings each day, with around 15 to 20 phone calls daily.
“It’s not all client phone calls,” Vanaski says. “We’re constantly working with accountants, attorneys, insurance agents to brainstorm about client situations or review something they’re working on for our client.”
These other professionals are called centers of influence. They’re the experts who advise clients in other areas of their lives.
Centers of Influence
Centers of influence can be key sources of client referrals for advisors. For instance, when a woman wants a different advisor than her former husband has following a divorce, she may ask her attorney or accountant for a referral.
Harris spends a lot of time “right away, every day” ensuring those “important centers of influence are satisfied and taken care of,” he says. “If they have open questions about one of their clients, we make sure we’re addressing those.”
Financial advising is all about marketing and keeping the business “engine” fueled through constant outreach and engagement. “Without a systematized marketing and growth plan, growth is inevitably quite difficult — much like the saying ‘if you aren’t growing you’re dying,'” says Dan Simon, a retirement planning advisor with Daniel A. White & Associates. His firm, which is in Glen Mills, Pennsylvania, and Middletown, Delaware, holds on average two educational seminars a week to draw in new clients.
“The most successful financial advisors are very active and will be doing several events every week,” be it breakfasts, lunches, after-work events or even weekend outings, Harris says.
Most financial advisor tasks are done with the goal of improving their clients’ financial lives. This can be challenging when everyone’s life situation is unique. To this end, many financial advisors choose to specialize in a particular niche for clientele.
The types of financial advisor specializations can include:
— A particular client group, such as women, teachers or millennials.
— A type of planning, such as retirement planning, estate planning or insurance planning.
— An investment style, such as socially responsible investing or income investing.
A specialization “allows you to become an expert in solutions that serve that specific market, distinguishing yourself from the firm down the street,” Simon says.
A Financial Advisor’s Responsibilities
To summarize, financial advisors have several responsibilities:
— They meet with clients to help them address their financial needs and goals.
— They create financial plans based on client financial needs and goals, then help clients enact those plans.
— They serve as a resource when investors have questions or concerns and help them adhere to their financial plans when markets get rocky and emotions run high.
— They stay updated on market events and regulatory changes that could impact their client’s situations.
— They work with other professionals who can offer additional guidance to clients, such as around tax planning or legal matters.
— They market their services to find new clients.
— They may pursue specializations or industry certifications to broaden or hone their skills and services.
Where Financial Advisors Work
The need for day-to-day activities that add value to clients leads advisors to workplace situations that “revolve around client education, client communication, client strategy meetings, advisor education and continued active asset allocation improvement and research,” says Daniel Milan, managing partner at Cornerstone Financial Services in Southfield, Michigan.
“We attempt to drive this by creating a team-based workplace environment where we have individuals with different areas of expertise,” he says. “Therefore, much of our workplace situation is team problem-solving and discussions surrounding different client cases.”
Ranker has a similar situation where she is part of an independent firm that operates as an ensemble. “We realize that the best planning comes from collaboration and brainstorming,” she says. “Our team approach creates a familial feel, which I believe is not common in our industry.”
Most financial advisors work for a larger financial institution, such as a brokerage, bank or insurance company, but nearly 1 in 5 advisors were self-employed in 2019, according to the Bureau of Labor Statistics.
Even advisors who work for a larger institution are really working in their own silo, Milan says. “Most financial advisors typically are working at firms on a macro basis, but if you really drill down, they are either working individually within that firm, or if you are lucky, with a small team.”
Being part of a larger firm is not the same as being part of a team. “Oftentimes, advisors who are part of a firm are still competing against each other for the same client,” Ranker says. “So even though they are part of a firm, the deliverable is much closer to an individual.”
Advisors usually work in offices. These can be large branch offices with upwards of 30 employees, including multiple advisors and their respective support staff. Or they may be smaller offices with a single advisor and her myriad staff members. Self-employed financial advisors typically work in the latter environment, with their own private office and small team.
Of course, since COVID-19, more advisors are embracing remote work options. One PricewaterhouseCoopers survey of nearly 200 financial services professionals found that before COVID-19, less than 30% of financial services companies had at least 60% of their workforce working from home once a week or more. After COVID-19, that number jumped to almost 70% of surveyed firms. Another PricewaterhouseCoopers survey revealed that 61% of chief financial officers plan to make remote work permanent for some roles.
“Virtual work is definitely here to stay,” Milan says. “The forced adoption by a lot of our clients over the last year and a half allows for more options for quicker updates or review meetings, which creates higher efficiency for both the client and the advisor.”
That said, he doesn’t see a remote work environment as optimal for his team and firm, so it likely won’t become common in his office. He could see some of the larger brokerages and banks making remote advisors commonplace, however.
Ranker says much the same of her situation. “The virtual, remote work environment has been a great tool to keep us in touch with our clients during the pandemic, but I don’t think it is going to replace the face-to-face meetings,” she says. She feels strongly that the work advisors do requires a more personal touch.
“Live meetings will still be the main interaction, but having virtual options for when time is tight or the weather is bad is a great addition to our arsenal,” she says.
Advisors don’t spend all of their time in the office, either — whether it’s a home office or work office. Travel for conferences, networking or client events can be a part of the job. The financial advisor career, after all, is as much a sales and networking job as it is a money management one.
More from U.S. News
Update 07/01/21: This story was published at an earlier date and has been updated with new information.