Financial Representative vs. Financial Advisor: What Are the Differences?

A career in finance can offer many opportunities for those who are interested in helping others manage their money. Two common positions in this field are financial representatives and financial advisors. Though both roles share some similarities, there are several key differences between them.

In this article, we discuss the differences between a financial representative and a financial advisor, and we provide additional financial professions you may be interested in pursuing.

What is a Financial Representative?

A financial representative is a professional who provides guidance and advice to clients on how to best manage their finances. Financial representatives typically work for banks, investment firms or insurance companies. They meet with clients to discuss their financial goals and needs, then recommend specific products or services that can help them meet those goals. Financial representatives must be able to understand complex financial concepts and explain them in simple terms to their clients. They also need to stay up-to-date on changes in the financial industry so that they can provide accurate and timely advice to their clients.

What is a Financial Advisor?

Financial Advisors provide guidance to clients regarding investment opportunities, insurance coverage and other financial planning strategies. They assess a client’s current financial situation, then provide recommendations on how they can improve their long-term financial stability and security. Financial Advisors typically work for banks, investment firms or insurance companies. They often work with clients one-on-one to understand their unique financial goals, then create a customized plan to help them reach those goals. Financial Advisors must have excellent communication and customer service skills to build rapport with clients and keep them updated on their progress.

Financial Representative vs. Financial Advisor

Here are the main differences between a financial representative and a financial advisor.

Job Duties

Financial representatives perform many of the same tasks as financial advisors. They both talk with clients and prospective clients, research financial products and markets and develop financial plans. The primary difference is that financial advisors are licensed to sell financial products, such as securities, whereas financial representatives are not. This means that financial representatives cannot sell investment products or insurance policies on their own.

Another key difference between financial representatives and financial advisors is that financial advisors often work with clients for an extended period of time. Financial advisors may meet with clients every month, quarter or year to discuss their progress toward financial goals and make adjustments as needed. In contrast, financial representatives typically provide one-time services, such as selling a client an insurance policy or helping them purchase a security.

Job Requirements

A financial representative is a sales position that does not require a specific degree, but many employers prefer candidates who have at least a bachelor’s degree in business, economics or a related field. Financial representatives must also pass the Series 7 and Series 63 exams to become licensed by the Financial Industry Regulatory Authority (FINRA). These exams test financial representatives on topics like investment strategies and securities regulations. After passing these exams, financial representatives can begin working with clients.

Financial advisors typically need at least a bachelor’s degree, although some may have a master’s degree as well. Many financial advisors pursue certifications through organizations like the Certified Financial Planner Board of Standards (CFP) or the Chartered Financial Analyst Institute (CFA). To earn these certifications, financial advisors must complete extensive coursework and pass exams that cover topics like investment planning and portfolio management. Financial advisors must also be licensed by FINRA.

Work Environment

Financial representatives work in a variety of environments, depending on the type of company they work for. For example, financial representatives who work for banks may spend most of their time working in an office setting with other employees and customers. Financial representatives who work for insurance companies may travel to meet with clients or attend conferences.

Financial advisors typically work in an office environment where they can focus on meeting with clients and providing them with advice. Some financial advisors also have their own businesses and work from home offices.

Skills

Both financial representatives and financial advisors need to have excellent customer service skills. They will be working with clients one-on-one to discuss their financial needs and goals, and it is important that they build trust and rapport with their clients. Financial representatives and financial advisors also both need to be able to understand and explain complex financial concepts in a way that is easy for their clients to understand.

Financial representatives typically work for banks, insurance companies or other financial institutions. They sell products like loans, credit cards and insurance policies to individuals and families. Financial advisors usually work for themselves or for a financial planning firm. They provide advice to clients about investments, retirement planning and other financial matters.

Both financial representatives and financial advisors need to be able to close sales and meet quotas. However, financial advisors may need more advanced sales skills as they are typically selling more complicated products and services than financial representatives. Financial advisors also need to have strong research skills as they need to stay up-to-date on changes in the market and different investment opportunities.

Salary

Financial representatives and financial advisors both work in the financial services industry. Financial representatives earn an average salary of $67,340 per year, while financial advisors earn an average salary of $77,048 per year.