How to Start a Financial Advisor Business? 5 Steps And Success Tips

how to start a financial advisor business

If you’re working in a firm as a financial advisor and want to offer financial advisory services independently, it’s the most logical thing to do now. But, even if you’re currently studying business or economics to become a financial advisor, you should know that the financial advisor business is booming. With more and more people turning towards investments and insurance, it will be a rewarding career for years to come. So, here is our take on how to start a financial advisor business.

How to Start a Financial Advisor Business

Step 1: Looking up Your Demand

The first step towards learning how to start a financial advisor business is searching for your demand. Next, you must identify your microniche within the financial advisory domain and invest your skills and time. You can go for any subdomains, including financial planning, insurance, investments, loans, mortgages, etc. However, investments and financial planning have the highest chances of scaling up, and these niches never go irrelevant.

But regardless of which area you pick, your hard work and expertise decide how successful you become. So, once you’ve identified which area you want to specialize in, it’s time to sit down and plan for the following practical stages. Keep reading to learn more about how to start a financial advisor business.

How to Start a Financial Advisor Business

Step 2: Preparing Your Credentials

Whether you work in a firm or have a financial advisor business, having the proper licenses and credentials is crucial. In addition, no matter your country, you will need different licenses to distribute different products and services.

For instance, if you’re offering financial planning services, you would need some financial planning credentials, such as the Certified Financial Planner (CFP). With the proper certifications and licenses, you have the authority to offer financial services.

Some other helpful certifications for financial advisors include the Chartered Financial Analyst (CFA) and the Certified Public Accountant (CPA). However, CFP and the CFA are two of the most-sought certifications in financial advisory.

How to Start a Financial Advisor Business

Step 3: Finding the Right Distribution Method

When you work in a company as a financial advisor, you know that you don’t have to worry about the distribution side. You work as part of a big organization connected to the stock exchange and custodians.

However, since you’re still reading this article and learning how to start a financial advisor business, we assume you want to start working independently.

Hence, you need to take care of all this, and that’s where most people get stuck. You need clients to put your efforts into the right place and kickstart your business.

Once you start getting clients, you need to make financial plans for them and get them insured by any of the big insurance companies in your country. But that’s a lot of work that a new business probably doesn’t have the resources to do.

This is the most crucial stage for people looking for a plan to start a financial advisor business. You need access to the Managing General Agents (MGAs) and market dealers so they can link you with the world of investments already existing.

This helps because now you don’t have to go to investment or insurance companies to get services for your clients. Instead, these distributors will do all of that for you.

How to Start a Financial Advisor Business

Step 4: Setting up Your Business Structure

Next, you need to work on setting up your business structure. Once you’re connected with any MGA or a financial planning software company, you’ll find they don’t work with you unless you are a registered corporation.

You must have a legal entity to sign the contract with these MGAs and financial planning companies. So, you must go to a lawyer and get yourself documented as a corporation.

Once registered, you must have your corporation name and bank account.

With time, you will realize that keeping a separate bank account is crucial in setting up a financial advisor business. It influences everything from your daily transactions to taxes. After all of these formalities, you now have a business structure that allows you to carry forward your services.

How to Start a Financial Advisor Business

Step 5: Focusing on Customer Experience

Once you’ve figured out your niche, gotten relevant certifications and licenses, established your business structure, and found the correct distribution method, you’ve learned how to start a financial advisor business. Now it’s up to you to expand your business and deal with your clients.

You can probably link up an app to make things easier for your clients or use any financial planning software that meets your client’s needs in a better and more systematic way.

Plenty of financial planning software out there automates things for you and improves your efficiency. Some areas where you would require financial planning tools include customer relationship management, portfolio management, document management, etc. Most financial advisors use more than one software, but it is totally up to you how you go about that.


1. How to get clients after learning how to start a financial advisor business?

Some ways you can acquire clients include online social networking platforms such as LinkedIn, joining small business think tanks, or attending local networking events. All these places help you make connections that eventually get clients for your business.

2. How to start a fee-only financial planning firm?

To start a free-only financial firm, you can start by getting the relevant certifications. Plenty of institutes help aspiring financial advisors get certifications and licenses for free.

3. How to build a book of business as a financial advisor?

As a financial advisor, you can build a book of business in several ways, such as using referrals, social media, public relations, and websites. These areas allow you to showcase your expertise and convince people how you can add value to their financial planning journey.


Many finance students and those already working in the finance industry think of setting up a financial advisor business at some point. But most of them don’t have a clear direction on how to start a financial advisor business. You can start by pinpointing the area you want to specialize in, getting the relevant certifications and licenses, setting up your business structure, and finding clients.


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