A big decision financial advisors have to make early in their careers is where to set up shop.
More young professionals are likely to be facing this decision as they are enticed into the financial advisor occupation in coming years, according to a new study by SmartAsset. Employment of personal financial advisors is projected to grow by 4% from 2019 to 2029, about as fast as the average for all occupations, the report said, citing Bureau of Labor Statistics research.
Pay is a big inducement. The average annual earnings for advisors in 2019 were about $119,300, more than twice the average annual earnings for all U.S. workers. Not only that, advisors can tailor their own practice to their strengths or interests and have a flexible work schedule.
Furthermore, the coronavirus pandemic has prompted many people to consider hiring a financial advisor. SmartAsset cited a recent survey in which one in five of Gen Xers, millennials and Gen Zers who did not have a financial advisor before the pandemic planned to start working with one.
To find the best cities for young financial advisors to start their careers, SmartAsset compared 100 of the largest U.S. cities across five metrics. Two of these — average financial advisor earnings and rent as a percentage of average financial earnings — look at the job situation for financial advisors.
The remaining three focus on the city’s relative demand for financial advisors, including financial advisor search volume, percentage of high-earning households and percentage of the population nearing retirement, reflecting a more promising potential client base for local financial advisors.
Researchers ranked each city in every metric, giving full weighting to each, and then found each city’s average ranking and used the average to determine a final score. The city with the best average ranking received a score of 100. The city with the worst average ranking received a score of zero.
See the gallery for the 12 top cities for young financial advisors to start their careers.
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