When you’re young, it’s easy to think that your career path is carved in stone. You go to school, get a job, work your way up the ladder, and retire with a gold watch. But today, more and more people are choosing to change their careers in the middle of their lives. And if you’re a finance major, there are plenty of exciting new career paths waiting for you.
One of the most popular new career paths for finance majors in entrepreneurship. Many successful entrepreneurs started as finance majors. If you have an idea for a business or even just an interest in starting your own company, entrepreneurship may be the right path for you. There are many other career options for finance majors. This article will tell you everything you need to know about finance majors.
1. What is a Finance Major?
A finance major is a type of degree that focuses on studying and applying financial principles. A person may earn a Bachelor‘s in Finance, Master’s in Finance, or Doctorate in Finance. The main objective for these degrees is to prepare students for careers as financial advisors, accountants, analysts, and other positions where people work with money.
Finance majors develop skills such as reading critical data from reports and then using this information to make predictions about future performance. They also learn how to assess risk when making investments. In addition, they learn about different types of investment vehicles like stocks, bonds, and mutual funds, which investors can use, both small business owners and retirees alike.
2. What Courses are Included in a Finance Degree?
Most finance degrees include accounting, economics, risk management, and investment. However, since finance is constantly evolving, many schools are now offering specialized finance degrees that may focus on a particular area like corporate finance or financial planning.
No matter what type of degree you choose, be sure to ask the school about their specific course offerings so you have a good idea of what you will be learning. And if you’re not sure whether or not finance is the right degree for you, consider taking some introductory courses to get a taste of what it’s all about.
3. What are the Different Career Paths a Finance Major can Take?
The variety of possible careers for finance majors is staggering, and it can be challenging to choose which path you want to take when it seems like there are so many options. Here are some of the most common career paths that finance majors tend to pursue:
1. Financial Analyst
A financial analyst helps make business decisions by examining and assessing data related to a company’s financial health. This includes looking at the company’s financial statements, checking for compliance with local and national laws, and making projections about future revenue and expenses.
2. Investment Officer
An investment officer’s work involves identifying, marketing, selling, buying, trading, investing in, managing, assessing the performance of, protecting the value of, or liquidating securities that represent ownership in a corporation or other entity. The job may entail selecting which securities to buy or sell, determining the best price for a security, and negotiating with buyers.
3. Portfolio Manager
A portfolio manager’s work involves:
- Overseeing an investment portfolio by maintaining its performance.
- Rebalancing it as needed.
- Mitigating risks associated with it.
- Ensuring that financial objectives are met.
They are often responsible for buying and selling securities and other investment products to meet the client’s risk tolerance and diversification needs.
4. Financial Counselor
A financial counselor’s work involves advising clients on financial decisions. This could be as simple as helping an individual pick a savings goal for their child or teaching someone how to manage their spending better and save money.
5. Investment Analyst
An investment analyst helps companies make sound investment decisions by looking over current investments, determining how the company can best allocate its funds, and evaluating the performance of current investments. This could entail looking at how various investments are performing relative to one another over time, where there is room for improvement, or suggesting specific strategies for investing in certain markets.
An accountant’s primary responsibility is to keep track of a company’s financial records and transactions, including recording income and expenses, paying bills and taxes, keeping the company’s books up to date, making sure that any government regulations are being followed, and filing reports for shareholders or tax agencies. They may also be tasked with helping upper management make financial decisions and managing its budget.
7. Investment Banker
An investment banker helps companies raise money by selling securities such as stocks and bonds. Investment bankers collect information about a company, analyze it, and then determine which securities to sell based on that information. Some investment bankers work directly with clients to help them decide which securities to sell and which specific buyers to approach, while others may work with the company’s management team as a whole.
8. Financial Planner
A financial planner helps individuals and companies plan for their future by analyzing their current finances, assessing their risk tolerance and investment objectives, and making appropriate recommendations. They may recommend investment strategies for your retirement savings or suggest a plan for your children’s education. They may also be called upon to explain a client’s financial position and prospects to a family member or other trusted individual.
4. Do Finance Majors Make Good Money?
The short answer is yes.
According to the U.S. Bureau of Labor Statistics, financial managers earned a median wage of $109,650 in 2016. The median means half made more and half made less. Those in the top 10% earned more than $187,199 a year, while those earning the lowest 10% took home about $60,920.
While previous years’ data showed financial managers had lower earnings than some other finance professions, recent BLS data shows that more of them earn higher salaries. In contrast, others are seeing their wages stagnate or fall slightly. For instance, investment advisors earned a median salary of $84,680 in 2015 but by 2016 were down to $80,580.
An entry-level financial analyst typically makes $52,000 a year, and the median salary for all financial analysts is only slightly higher at $55,720. Investment banking analysts can make about $59,100 in their first year, but the profession tends to pay well overall, with a median of around $124,000 per year.
Most financial planners are self-employed, but those who work for an organization tend to make less money than their counterparts in other finance professions. The median salary for a certified financial planner is about $45,000 per year, compared to the median full-time wage of $53,750 reported by the BLS.
Accountants typically earn $35,000 or less, but those employed by companies tend to make more. The median salary for all accountants is $67,550, and the top 10% of earners make $104,870 per year. Accountants and auditors working in finance and insurance earned a median salary of $73,150, about 20% more than accountants working for the federal government.
Tax preparers saw their median hourly wage fall slightly from $16.48 in 2015 to $15.68 in 2016, while tax preparer supervisors’ wages stayed constant at $43,070 per year. Both categories typically work part-time and are paid by the hour instead of a yearly salary.
5. Top Recruiting Companies for Finance Majors
If you’re a finance major, knowing which companies are the best to work for is essential.
The following is a list of the top recruiting companies for finance majors, according to Vault.com:
- Goldman Sachs
- JP Morgan Chase
- Morgan Stanley
- Bank of America Merrill Lynch
- Wells Fargo
- Prudential Financial Inc.
- Deutsche Bank
- Credit Suisse Group
- HSBC Holdings
- Barclays PLC
6. Are Finance Majors in Demand?
It’s no secret that finance majors have many opportunities awaiting them after college. But are they in demand?
The answer is yes. According to the U.S. Bureau of Labor Statistics, jobs for financial managers are expected to grow by 10% from 2016 to 2026, faster than the average for all occupations. The demand for accountants and auditors is also projected to grow by 10%, while jobs for tax preparers are expected to grow by 11%.
So if you’re a finance major, rest assured that you will have no trouble finding a job when you graduate. In fact, you may be spoiled for choice!
7. The Benefits of Being a Finance Major
Some of the benefits of being a finance major include:
1. Career Outlook
If we take the job title “Accountant” as a typical finance major career and look at it on indeed.com, we see that the median salary for this job is $51,000 and that there are approximately 15k jobs available in this field. This data does not include those who chose to go into management or business development.
2. Starting Salary
Data collected from the National Association of Colleges and Employers suggests that finance majors see a starting salary of around $44,456; this data reflects all different majors. “The salary for finance majors is $50,000 and below and compares to an average of $48,891 among other college and university graduates in the nation.”
According to the Occupational Outlook Handbook, finance majors can find insurance and real estate jobs. The job outlook for all college graduates is at 8%, and the projected growth over the next ten years for this major is at 14%.
4. Minimal Career Path
Finance majors can start as analysts and move up to managers or vice presidents. Those who choose to study finance but are not significant in it may find themselves staying an analyst for an extended period if they decide to go into management instead. There are only so many positions within a specific company, and a finance major has a better chance of working their way up the corporate ladder.
5. Rigorous Curriculum
Those who decide to study finance may find themselves studying more outside of the classroom than those enrolled in other majors. Finance courses can be demanding, requiring much time and dedication from students, and these courses can teach valuable lessons in working under pressure, time management, and being well-rounded.
Finance majors can be found at many networking events for colleges/universities across the country. They also see a lot of alumni, creating a sense of community among students studying finance. This allows them to speak with alumni who have found success in their fields, giving them more insight into their expectations after graduation.
Many of these benefits are very similar to those seen among others who major in finance. Some students like the challenge of studying finance, while others enjoy having many opportunities during and after college for networking purposes.
8. The Challenges of Being a Finance Major
Some of the challenges of being a finance major include:
Finance majors often spend more time studying than those enrolled in other areas of study. This is due to the rigorous curriculum and the possibility of taking on an internship. According to a finance professor at Georgetown University, some students can even feel overwhelmed during their first semester due to excelling academically and taking on too many extracurricular activities.
2. Long Term Commitment
Some students find it challenging to commit to studying finance because they are interested in something else outside of the classroom, whether accounting or real estate. This means that those who enroll in these courses may not have as much interest as they would need to succeed in the long run.
9. Best Colleges to Study Finance
Many colleges around the country offer finance degrees. However, some stand out more than others regarding job placement and networking opportunities. The best colleges to study finance, according to Forbes, are:
1) University of Pennsylvania: UPenn is known for its strong ties to Wall Street, with top recruiters such as Goldman Sachs and JP Morgan Chase. The Wharton School at UPenn is one of the most highly respected business schools globally, which helps finance majors find jobs after graduation.
2) Stanford University: Located in Silicon Valley, Stanford is known for its robust technology and entrepreneurship programs. This gives finance majors opportunities to network with some of the biggest names in Silicon Valley.
3) University of Chicago: The University of Chicago is well known for its excellent entrepreneurial programs, along with a vast alumni network.
4) Massachusetts Institute of Technology: MIT has a bustling tech industry and strong ties to the finance community. This gives finance majors a plethora of networking opportunities that can be taken advantage of after graduation.
5) New York University Stern School of Business: Considered the number one business school by Bloomberg, NYU is often ranked as a top 10 private university in the country. This gives students who study finance an excellent education that can help them find jobs after graduation.
6) University of Notre Dame: Located in South Bend, IN, Notre Dame has an alumni network to rival any other university in the world. This helps finance majors find jobs after graduation since they have alumni willing to help them network with potential employers.
7) Brigham Young University: BYU has top-notch programs for business and entrepreneurship students. Though many students don’t realize it, being a Mormon is not required to study at this university.
8) University of California, Berkeley: Located in Northern CA, UC Berkeley is a powerhouse of entrepreneurship and technology programs. This helps finance students find jobs after graduation since they can work with startup companies.
A career in finance can be an excellent choice for those who enjoy analytical thinking and problem-solving. Finance majors typically work with many different types of data, such as financial statements, market research reports, and government regulations, to make informed decisions about the future direction of markets or organizations. With so much potential knowledge at their fingertips, it’s no wonder that they have become an integral part of business operations all over the world!