Discount factor is a mathematical formula used in the cost-benefit analysis and discounted cash flow analysis to calculate the present value of profits that will be received in the future, commonly known as future cash flows. Personal financial advisors and financial analysts must have computer, analytical, mathematical and problem-solving skills. Also, because analysts and advisors must explain their findings and recommendations to others, they must have excellent presentation skills, self-confidence, maturity, as well as the ability to work alone. Among other skills a financial analyst must possess are a strong attention to detail, a drive for research, and an understanding of tax laws, money markets, and the economy in general. The association of Investment management and Research offers certification as a Chartered Financial Analyst (CFA).
Qualifications for certification include a completed bachelor’s degree, three years financial experience, and successful completion of three essay tests. Certification for personal financial advisors includes the Certified Financial Planner designation offered by the Certified Financial Planner Board of Standards, Inc. The Chartered Financial Consultant (ChFC) is another credential that is obtainable from the American College in Bryn Mawr, Pennsylvania. Another catalyst for growth in the financial services industry is deregulation.
Though personal financial advisors do not need to be licensed, if they wish to provide services as an investment or real estate broker then they must be licensed to offer those respective services. Financial analysts can move up to positions as finance or portfolio managers that oversee all the investments of a corporation or customer. As the international securities economy expands, so will the need for advisors and analysts who understand it.
Upward movement for personal financial advisors is typically accomplished by expanding your clientele; however those who work for organizations can advance by filling management positions. Because of the expansion of both individual and business investment, jobs for financial analysts and personal financial advisors will continue to grow through the next decade.
As the number of people involved in investment increases, and as the next generation of retirees begins to think more seriously about the future both analysts and advisors will have the opportunity to provide them the financial services they need. Many banks are becoming involved in brokerage and investment activities and need qualified financial analysts to support new customers. Security Analysts and Investment Analysts are the other job titles for this role.