In this write up we look at the five most important elements of a Financial Advisor and the reasons it is important to have these traits to succeed in the industry.
Are you exploring the career option as a Financial Advisor?
You are about to choose one of the fastest-growing career options in India. As the country grows at a fast pace and creates a large middle class and HNI population, there is a growing demand for Financial Advisors. However, this remains a highly competitive career option where only the best in trade rise up the pyramid.
As you hit the market along with the qualification you must also have the right professional traits. These traits or elements shall decide your success in the future.
Several traits or elements separate the best Financial Advisors from the ordinary or bad ones in the market. If you wish to be successful in this profession you need to have these traits. Not everyone who chooses to be a Financial Advisor is born with these qualities, but you can easily imbibe these traits and create your name in this profession.
While there are dozens of elements that separate the best advisors from ordinary ones, here we shall look at the five important traits that one must have to be a good financial advisor.
- A Person with Passion for Finance
The first and the most important quality of a Financial Advisor is an unrelenting passion for finance and the job. This isn’t an ordinary job but one that would test your analytical ability every single day.Though you’d be aided by tons of data and dozens of tools, you will need to use your knowledge in finance and apply that in unique ways to get desired results for your clients. You need to have your heart in the game and always look out for creative ways of applying your knowledge to solve problems for your clients. Hence, you must have a passion for finance and always stay ahead in the game.The laws, regulations, and compliance requirements concerning investment, planning, and finance keep changing regularly and you must stay abreast with them. For instance, a small change in taxation laws can affect your clients’ lifelong investment planning or increase their tax liability and you must have a detailed understanding of how these laws would affect your clients and be able to suggest the right kind of shift in strategy to leverage these changes and not become a victim of it.
As an investment or tax consultant, you are the last person clients would listen to and make some of the most crucial decisions of their lives based on your advice. There should be no ambiguity in your judgment and your lack of knowledge or outdated knowledge mustn’t come back to hurt your clients. In simple words, you must have fire in your belly and without it, you’d never succeed in this race.
- A Person Who Is Always Curious
Investments, tax planning, retirement planning is a dynamic field. As we have stated above the rules of the game continuously change, and financial advisors need to swim with the tide. The best strategies employed a few years back might not be the best for the present and the future. Thus, a Financial Advisor needs to have their hands on the pulse of the market and suggest the right investment and retirement options to their clients. It calls for a good Financial Advisor to be intellectually curious and you must constantly lookout for the latest trends and strategies in the market. Irrespective of the degree or qualification you bring along the absence of a curious mind can serve as a major handicap in this trade.You must be a lifelong learner and never sit over the laurels of the past. It is important to be on a path of self-improvement and learning from past mistakes. You won’t call it right every time and with every single client but you must always gather new knowledge that lets you help the majority of your clients meet their financial goals.Along with being curious about the markets and keeping an eye on the best investment avenues a good Financial Advisor should also be curious about his/her clients. Every client is different comes with different sets of financial goals, risk appetite, and has different horizons for investment.
Not all clients are great communicators and you must put your curiosity to good use and understand their goals. Uncovering the unique needs of a client and suggesting the best options is one of the most important traits in this profession.
- An Analytical Mind
The role of a Financial Advisor isn’t the easiest one on this planet without being disrespectful to other professions. But the truth is you will have to constantly override all the challenges that this job presents with your analytical abilities.One of the most important parts of this job is to analyze clients’ needs, their current financial condition and check out a unique strategy that would help them achieve a positive outcome. There are no ‘magic recipes’ or shortcuts to success and you will have to master the process of analytical thinking every single day. In short, if you don’t have an analytical mind, you are unlikely to succeed in this profession.Investment planning, retirement planning, tax planning, and estate planning require you to dig deep into numbers and make information out of the raw data at hand. You should be able to interpret these numbers to identify the strengths and weaknesses of the current financial strategies adopted by clients.
Your aim should be to make the best out of their positive investments and make them aware of the downsides of their investment mistakes. This calls for an in-depth analysis of finance for every single client. You should be able to draw the red flags at the right time and advise them on the best opportunities for investments and planning. These require sharp analytical abilities. If you aren’t naturally analytical, you will have to build this capability over time.
- A Person Who Sets the Priorities Right
Imagine a physician who suggests unnecessary clinical tests or medicine to a client or an automobile repairer who replaces perfectly working parts in a vehicle to pump up his profits. Would you term such conduct professional? The same goes for a Financial Advisor where must set the priorities right.Your interests, professional perks, performance incentives, and commissions are secondary to the interests of the clients. It is unethical for you to sell a financial product or suggest an investment that isn’t in the best interest of your client or not suited to their financial goals. The role of a financial advisor is always to ensure clients earn the highest returns and enjoy the fruits of their investments.Your growth in this career is important but it shouldn’t be at the cost of your clients’ interest. As an independent professional or one who is working with a finance firm, you need to align your personal growth with that of your clients. Honesty and integrity are particularly important traits in this profession, and they would hold you in good stead in your career.
When clients enjoy positive outcomes from your service they are likely to bring in more people to the fold and increase your revenue and other benefits. Given the demand for trained financial advisors in India and the projected growth in this business, you are likely to be fairly compensated when you do your job well.
- Communication Skills
Last we come to communication skills and as in most professions that require client-service provider interaction it is one of the most important qualities to have. A Financial Advisor must be a good communication to instill confidence in the minds and hearts of his/her clients.Poor communication skills can be intimidating for the clients, and this can hurt your career prospects in the industry. While some are natural communicators it is one skill you can pick up by putting in the hard work. You will have to work on both verbal and non-verbal aspects of your communication skills. The latter is often overlooked but decides success in this profession.As a financial advisor, you are likely to work in a one-to-one setting with your clients and hence communication becomes very important. You should breathe confidence as you speak to your clients as this is reassuring for them.
Good communication skills don’t only concern what you speak but the skill and courtesy to lend a patient ear to your clients. Good advisors have a common trait – they are active listeners and allow clients to share all their ideas, doubts, and plans with the advisor. When you keep your ears open you will understand the needs of your clients and serve them better.
To conclude, we have covered the most important traits that one must have to be a successful Financial Advisor. Along with your education and qualification, these are the traits that would help you achieve success in this industry. The life of a financial advisor is a continuous learning exercise and focused on working for the interest of the clients.