Northeastern University’s Online Master of Science in Finance prepares students for a number of im Read More
Finance professionals seeking upper-level management positions need a master’s degree that prepares them for a career journey with the potential of reaching the C-suite. People with an advanced finance degree have their choice of many different roles to pursue as they work their way to the highest levels of finance operations.
To attain midlevel and senior-level finance degree jobs, such as senior financial analyst, financial risk manager, mutual fund analyst, or investment banker, candidates must overcome stiff competition. However, the earning potential for finance professionals tends to be greater in the long term than management salaries in non-finance roles.
Choosing the finance area that best fits a finance degree holder’s skills, experience, and career goals requires understanding the characteristics of specific roles, including typical duties and responsibilities, salary potential, and job prospects. This guide describes six midlevel and senior finance positions in detail and takes a quick look at some more unusual career options for finance professionals.
Senior Financial Analyst
Financial analysts are employed by companies in all industries, particularly investment firms, insurance companies, financial services, and business consultancies. Finance Walk lists the duties of midlevel and senior financial analysts:
- They perform quantitative analyses of internal operations that inform the decisions of investors, bankers, and corporate finance officers.
- They manage the monthly balance sheet, income statement, and financial reporting and analysis for all business units.
- They participate in projects designed to make business processes more efficient.
- They develop and maintain financial models used by analysts to ensure the accuracy and completeness of all financial reports.
- They ensure compliance with all government regulations relating to financial reporting and other operations.
- They analyze and approve all spending on business projects and oversee cost-analysis functions to establish and enforce policies and procedures in business units.
- They conduct industry and market analyses and communicate results to top managers and other decision-makers.
The U.S. Bureau of Labor Statistics (BLS) states that advancing to midlevel and senior financial analyst positions generally requires a master’s degree in finance or business administration. Financial analysts working in the securities industry must also be licensed by the Financial Industry Regulatory Authority to sell financial products. Many employers recommend that candidates for senior financial analyst jobs earn the Chartered Financial Analyst (CFA) certification from the CFI Institute, which requires a bachelor’s degree, at least four years of qualified work experience, and passing scores on three exams.
Among the skills required to qualify as a senior financial analyst are basic accounting knowledge, the ability to conduct thorough quantitative analyses, innovative problem-solving expertise, and technical knowledge of the latest analytical tools and methods. Investopedia notes that strong data analysis skills must be accompanied by the ability to report the results and communicate their implications to senior officials and business managers.
Senior Financial Analyst Industry and Career Outlook
The BLS projects the number of financial analyst jobs will increase by 6% between 2018 and 2028, which is about as fast as the average for all occupations. This growth is partially because an increased reliance on big data and other technologies is fueling the demand for financial analysts.
Competition for open financial analyst positions will remain high despite the technological changes because the number of people forecast to enter the profession will be greater than the number of available jobs. Candidates with an advanced degree and specialized certifications improve their chances of being hired, according to the BLS.
PayScale estimates the median annual salary for senior financial analysts is around $80,000, as of March 2020.
Investor Relations Manager
Investor relations managers prepare and present financial information about their companies for investors, analysts, business media, and other external parties, which distinguishes them from inward-facing financial analysts. Most investor relations managers begin their careers as business analysts or assistant investor relations managers, as the investor site Mergers & Inquisitions explains. After gaining five or six years of experience, they move into investor relations manager positions and then seek to become investor relations directors after several more years.
Only public companies are required to have investor relations departments, and at small investment firms, this may mean only one or two people. In private companies, the chief financial officer (CFO) is responsible for interacting with investors. Investor relations managers and directors deal primarily with institutional investors and research analysts from investment banks. Their goal is to present their companies as worthwhile investments while providing analysts with truthful and accurate information.
While analysts and assistant investor relations managers produce weekly and monthly reports on markets and industries, midlevel and senior investor relations managers focus on meeting with investors, reviewing interim financial statements, and developing presentations for annual meetings and sessions with senior managers to prepare them for investor meetings.
Becoming an investor relations manager requires earning the Investor Relations Charter (IRC) from the National Investor Relations Institute (NIRI). In addition to passing the IRC exam, candidates must hold a U.S. bachelor’s degree or the equivalent and have at least three years of qualifying full-time work experience in investor relations; have six years of qualifying work experience; or hold a current certificate relevant to investor relations and have at least three years of qualifying work experience. Finally, IRC certification requires that candidates achieve at least seven of 10 “domains of practice” with a public company and comply with the NIRI Code of Ethics and the IRC Code of Conduct.
Other certifications relevant to investor relations managers are certified public accountant (CPA) and chartered financial analyst (CFA). Mergers & Inquisitions states that investor relations managers have better job security than many other financial positions because their services are needed most when a company’s fortunes decline.
Investor Relations Manager Industry and Career Outlook
Finance Walk explains that demand for investor relations managers increased dramatically after enactment of the Sarbanes-Oxley Act in 2002. The law implemented new rules for more auditing transparency and public disclosure, accuracy in financial reporting, and internal financial assessments, among other requirements.
Investor relations managers play key roles in ensuring compliance with these regulations, which increases demand for finance managers with the skills and experience that protects the value of the companies’ securities. However, the heightened profile of investor relations managers has also increased competition for the positions, many of which are filed by finance executives who switch to the field well into their careers.
According to PayScale, as of March 2020, the median annual salary for investor relations managers is approximately $88,000, while the median annual salaries for mid-career investor relations managers and investor relations directors are around $90,000 and $120,000, respectively.
Financial Risk Manager
Financial risk managers mitigate potential risks to a company by applying such financial instruments and contracts as insurance, swaps, derivatives, and options and futures contracts. They also monitor securities inventories, analyze losses on securities held by a company, and assess the risk of partner firms’ failure to meet their financial obligations.
Among the industries employing financial risk managers are investment firms, banks, and accounting firms. In addition to reducing a company’s chances of suffering a financial loss due to market uncertainty, financial risk managers protect against losses due to currency and commodity price changes.
The professional designation of financial risk manager is issued via certification by the Global Association of Risk Professionals (GARP), which explains the five key roles played by financial risk managers:
- Understand market and credit risks
- Identify and respond to organizational threats
- Accurately estimate risk exposures
- Clearly communicate the findings of their analyses and present stakeholders with strategic options
- Consider risk management as part of an integrated system of processes
In addition to passing the two-part GARP exam, certification candidates must have at least two years of full-time experience working in a risk-related capacity, such as portfolio management, industry research, securities trading, or risk consulting. Investopedia explains that finance risk assessment begins with a qualitative risk analysis to determine the probability of any specific factor posing a financial risk to an organization and then progresses to quantitative risk analysis, which uses simulation or deterministic statistics to assign numerical values to risk based on assumptions and random variables entered into a risk model.
Financial Risk Manager Industry and Career Outlook
The BLS forecasts a 16% increase in the number of financial manager jobs between 2018 and 2028, which is much faster than the average growth for all occupations. Demand for financial risk managers will be driven by the increased emphasis on risk management by banks and other financial services, according to the BLS. In particular, banks now focus more on stability and risk management rather than on maximizing profits.
Private Wealth Manager
Private wealth managers typically serve high-net-worth clientele with a considerable amount of money available to invest. Also referred to as private bankers, wealth managers oversee their clients’ assets to maximize returns and minimize risks.
Investopedia explains that private wealth management combines financial planning, portfolio management, and other financial services for individuals rather than for corporations, trusts, or institutional investors. Private wealth managers counsel their customers on income taxes, estate planning, investment management, and legal issues related to their assets.
They must have experience with a range of investment instruments, including cash, fixed income, equities, and alternative investments, such as hedge funds, venture capital, real estate, commodities, and tangible assets.
The Investments & Wealth Institute offers the Certified Private Wealth Advisor (CPWA) certification, which differs from other financial analyst certifications in emphasizing a holistic approach that encompasses behavioral finance, family dynamics, asset protection, charitable giving and endowments, wealth transfer, and planning for executives and owners of closely held businesses.
According to the CFA Institute, private wealth managers are emphasizing personalization to counteract the depersonalizing effects of technology on asset management. This highlights the importance of interpersonal skills for wealth managers in addition to the ability to take advantage of technologies that automate many aspects of wealth management.
Private Wealth Manager Industry and Career Outlook
The BLS expects the demand for private wealth managers to increase along with the demand for other financial managers. The agency projects a 16% increase in financial manager positions between 2018 and 2028, a faster growth rate than the average increase for all occupations.
PayScale estimates the median annual salary for private bankers is around $70,500, as of March 2020, while the average salary for senior vice presidents in wealth management is approximately $127,000.
Investment bankers serve as intermediaries between businesses seeking investments to fund operations or expansion and investors looking for opportunities. According to Investopedia, working as an investment banker can often lead to higher-paying positions in venture capital, private equity, and wealth management. However, investment bankers tend to work long hours, and the position requires a range of skills that encompasses finance, technology, markets, and corporate organization structures.
Investopedia describes the five most important duties of investment bankers:
- Coordinate bond financing to pay for a business’s expansion or a large municipal project such as road construction. In addition to planning and pricing the bond issuance, investment bankers work with issuers to arrange the documentation required by the U.S. Securities and Exchange Commission (SEC) and assist in selling the bonds.
- Arrange and underwrite capital market financing that their clients use to help manage the risk in purchasing the issuers’ securities and selling them to institutional buyers and the public. Investment bankers profit by adding a markup to the price at which they purchase the securities before selling them to investors.
- Manage private placements that allow clients to raise capital by offering bonds to insurance companies, retirement funds, or other institutional investors. Clients receive their money more quickly because private placements do not require SEC filing.
- Advise a company planning a merger or acquisition, including helping to set a price for the transaction by determining the value of the target company. Conversely, investment bankers may also assist companies preparing to put themselves up for sale.
- Avoid potential conflicts of interest by complying with SEC rules prohibiting placing undue pressure on analysts to favorably rate their offerings. It is also important for investment bankers to avoid sharing confidential information about their clients with their companies’ traders.
Unlike many finance careers, investment banking doesn’t require a specific finance degree, although employers may favor candidates with a master’s degree in finance or an MBA. Investment bankers must hold a license to sell securities, such as the SEC’s Series 79, administered by the Financial Industry Regulatory Authority (FINRA); the Series 79 test is also referred to as the Investment Banking Representative Qualifying Examination.
Investment Banker Industry and Career Outlook
The BLS estimates the number of jobs for securities, commodities, and financial services sales agents will increase by 4% between 2018 and 2028, which is about the same as the average growth forecast for all jobs. According to PayScale, as of March 2020, the median annual salary for investment bankers is around $100,000, with $125,000 for midcareer professionals and $131,000 for late-career investment bankers.
Mutual Fund Analyst
Mutual fund analysts work for fund managers at mutual fund brokers to recommend whether to buy, sell, or hold specific securities. They are also called buy-side analysts — in contrast to sell-side equity analysts, who typically work for investment banks, as Investopedia explains.
The primary duty of mutual fund analysts is to research and analyze stocks, bonds, securities, commodities, and other assets. They present the results of their research to portfolio, fund, and investment managers, who combine the analyses with the work of other financial experts to assist managers in making investment decisions.
Along with an extensive background in finance, mutual fund analysts must have data-analytics skills as well as knowledge about specific industries, markets, and business climates. In the course of conducting research, mutual fund managers may meet with stockbrokers, fund managers, and traders, which may entail a great deal of travel and potentially a posting overseas.
The BLS indicates that financial analysts generally have at least a bachelor’s degree and a background in accounting, economics, finance, statistics, and mathematics. In addition to FINRA and CFA certification, mutual fund analysts may seek the Certified Fund Specialist (CFS) designation from the Institute of Business & Finance (IBF).
Mutual Fund Analyst Industry and Career Outlook
The BLS forecasts financial analyst positions to increase by 6% between 2018 and 2028, which is about the average growth forecast for all jobs. However, the rise of big data and other technological innovations will likely drive the demand for analysts who are capable of higher-quality analyses. PayScale reports the median annual salary for investment analysts, as of March 2020, is around $64,000, while the midcareer median salary is approximately $79,000, and the late-career median salary is around $101,000.
Other Unique Finance Degree Jobs
The heightened value of finance expertise and advanced data analytics knowledge has led to an increased demand for many finance professionals. As a result, graduates may want to consider putting their education to use in the following finance degree jobs:
- Financial auditors ensure that a company’s financial reports comply with generally accepted accounting principles (GAAP), as Investopedia explains. Their duties differ from those of corporate and management accountants in that financial auditors do not reconcile accounts or make accounting entries. Instead, they alert the company’s accounting or finance officials to any errors they discover.
- Government financial analysts and military finance officers may not receive salaries near those of their counterparts in the private sector, but the positions offer other benefits, including education cost reimbursement and job security. They are involved in contract management, budgeting, and financial forecasting. The U.S. Office of Management and Budget and the U.S. Department of the Treasury employ large numbers of financial analysts.
- Bankers are often referred to as “personal bankers” to distinguish them from investment bankers and private bankers. They typically work in retail banking, where they help customers open checking and savings accounts, apply for mortgages and auto loans, and purchase certificates of deposit. Bankers also counsel their clients on retirement and college savings plans. Because they interact with people who are often unfamiliar with banking terminology, the ability to communicate clearly and connect with customers is an important asset.
- Accountants and actuaries must possess strong mathematical and statistical problem-solving skills. Investopedia describes the differences between the two roles: Accountants support the work of business managers, investors, regulators, and auditors, while actuaries allow insurance companies to calculate risk accurately. Accountants tend to work behind the scenes and have an interest in finance and management, while actuaries prefer to focus on statistics and computer modeling.
- Financial or business journalists once filled a watchdog role in the corporate and financial sectors, as the journal Journalism explains. Consolidation in the financial industry and the economic pressures facing the media industry have diminished this important function, but the financial press continues to have a profound impact on Wall Street and the investment and finance industries as a whole. Finance graduates can play a key role in restoring the prominent place of finance and business journalists in alerting the public to problems and keeping financial firms in line.
- Budget analysts advise businesses, government agencies, and universities on the health of their finances. They conduct research and prepare reports on budget proposals, spending patterns, and the costs and benefits of specific programs. The BLS describes the range of tasks that budget analysts are involved in. For example, they may recommend areas where costs can be cut and extra funds redistributed, and they evaluate programs to determine whether they are meeting their goals.