Finance is one of the most popular academic majors in the United States. Business majors, including finance students, accounted for more than 20% of all undergraduates during the 2013-14 academic year, and they comprised roughly one-quarter of master’s students during the same timeframe.
Part of finance’s appeal stems from the practicality a degree in the discipline offers: a study by Georgetown’s Center on Education and the Workforce found that the average student with a bachelor’s degree in finance stands to earn an annual salary of $73,000. Those with a graduate degree in finance earn $101,000 per year on average, a higher average salary than degree-holders in any other field of business.
If you have a knack for working with numbers and want to pursue a career with excellent job prospects, you might be interested in studying finance. Below, we will examine some of the common academic requirements, essential job skills, and common professional pathways for finance majors. Our goal is to create a comprehensive resource to help you decide if finance is the right academic and professional path for you.
What is a Finance Degree?
A bachelor’s degree in finance is designed for students who plan to work in accounting, banking, and other business professions related to money management. Undergraduate finance programs are offered by most accredited colleges and universities. Although some finance bachelor’s programs require students to choose an area of concentration, many follow a more generalized curricula aimed at students who are unsure which finance career path they would like to follow. The best finance programs lay the necessary groundwork for either pursuing post-graduation employment or advancing toward a master’s or doctoral degree.
The Bachelor’s in Finance
A bachelor’s degree is required for most entry-level jobs in the field. In a bachelor’s program, finance students focus on how individuals, companies, organizations, and financial institutions manage money and assets. Courses also examine the relationship between money markets and different types of firms, along with public services like portfolio management, investment banking, and financial consulting. The first two years of a finance bachelor’s degree program are generally devoted to introductory major courses and required non-business courses (such as mathematics, English, and humanities subjects). During their final two years, finance students will enroll in upper-level courses focused on advanced economics, marketing, and other dimensions of financial study.
Some bachelor’s programs include specialization requirements or options. Popular concentrations in finance include financial management, investments, actuarial science and banking, insurance and financial services, risk management, and international finance. Internships are widely available for juniors and seniors in finance programs.
A finance major may choose from a range of specializations related to business, accounting, and money and asset management. Students must typically complete at least four or five courses in a specific field in order to earn a specialization. Some programs allow finance students to pursue an additional major instead of a specialization; popular additional majors in finance include economics, mathematics, and foreign languages. The following table includes some of the most common concentrations available to finance students.
- Computational Finance
Computational finance covers the mathematical and statistical methods used to analyze financial data. These methods include computational tools for portfolio management and other financial services, along with the theories, algorithms, and models used to assess risk and forecast market prices. This specialization is geared towards students with a strong background in math, statistics, and probability.
Entrepreneurship explores strategies and outcomes for businesspeople who launch their own companies, either with their own funds or through the financial support of outside investors like venture capitalists. Areas of focus include financial management, supply chain, and business law. Students who pursue an entrepreneurship specialization will graduate prepared to manage employees, balance corporate books, and optimize the efficiency of their company’s day-to-day operations.
- Investment/Financial Analysis
Investment and financial analysis examines the relationship between money markets and financial intermediaries (such as investment firms). Students explore some of the policies and regulations guiding today’s economy, as well as problems (and corresponding solutions) faced by finance professionals. This specialization is ideal for students who hope to pursue roles as financial analysts, financial examiners, and other careers that help individuals and organizations manage their accounts and investments.
- Financial Management
Financial managers oversee the accounts, investments, and other monetary activities of a business or financial institution. This specialization explores different short- and long-term strategies for spending and allocating capital, creating budget plans, and making informed market predictions. This concentration also covers web-based tools used to manage funds and create dividend policies, and explores the guidelines that determine how much of a company’s earnings should be allocated to its shareholders.
- Risk Management
âRiskâ is defined as any variable that influences potential losses or gains. Examples of risk include market uncertainties, legal issues, workplace accidents, and unforeseen problems (such as natural disasters). The risk management specialization primarily looks at the corporate finance and insurance sectors. The curriculum includes strategies for not only mitigating risks with negative consequences (threats), but also capitalizing on risks with potentially positive outcomes (opportunities).
Job Skills Developed Within a Finance Program
The country’s top bachelor’s finance programs equip graduates with the skills and knowledge needed to launch successful finance careers. Students who complete these programs will be eligible for jobs with companies and firms in the public and private sector, as well as nonprofit organizations that specialize in finance. Some of the top competencies for any finance major are listed below, though our list is not exhaustive.
Strong oral and written communication is an important skill for professionals in the field. Communication is an especially valuable trait for financial advisors and other professionals who meet with individual clients to discuss accounts, investments, and other monetary activities. These roles require the ability to explain complex financial concepts and offer clear advice about matters like portfolio management and market risk to people with little to no formal education in finance.
- Critical Thinking
The unpredictable nature of money markets requires individuals who are resourceful, diligent, and able to perform under pressure. Finance programs prepare students for this difficult environment by testing their abilities to approach critical decisions and resolve them promptly. Courses also teach students how to work with employers, peers, and clients in tense situations involving personal funds and financial assets. Critical thinking skills are valued throughout the industry, particularly risk management and other areas primarily concerned with forecasting, identifying, and mitigating threats.
- Data Analysis and Interpretation
Data is the backbone of monetary activities, and employers covet people who can analyze different datasets and identify patterns. These findings are often used to forecast market activities and make investment decisions. Data analysis also requires the ability to operate different tools and software programs, and adapt to new platforms as technology evolves. As a result, many finance courses devoted to data analysis incorporate elements of information technology and computer science into the curricula. Additionally, these courses explore how to interpret and explain data results to different audiences, including team leaders or clients.
Most finance jobs involve a constant stream of projects, meetings, reports, and other important activities. For this reason, organized employees tend to excel in finance, particularly in positions where project management is required. Individuals in these roles must oversee projects at different stages, delegate responsibilities to various team members, and ensure that all deadlines are met. Finance courses emphasize the importance of organizational skills through various individual presentations and team projects. Many programs also require students to compile and submit a comprehensive portfolio of their best work for official review prior to graduation.
Professor Sury is the chairman of INDORUS Holdings LP. This single family office (SFO) was formed after the sale of the investment firm he founded and ran from 2000-2009 — a nationally top ranked, multi-billion dollar investment adviser to wealthy families, institutional investors, and sovereign entities. He has also been the executive director of SIFIRM.
For more than 20 years, Professor Sury has been an internationally recognized expert in the fields of investment strategy and risk management. He has served as a close, trusted adviser to some of the nation’s wealthiest family groups, sovereign wealth and government entities, and private organizations; including nearly a dozen of the Forbes 400.
He is also an award winning professor, having taught rigorous undergraduate and MBA courses in investments, corporate finance, and applied portfolio management at institutions such as the University of California, Santa Clara University, DePaul University, and San Diego State University. Professor Sury received his MBA in finance & statistics (High Honors) from the University of Chicago and his undergraduate degree in economics (High Honors) from the University of California.
"Success in business, and finance careers in particular, require not only a strong command of various techniques, but also robust social skills and the ability to relate to others."
Why did you choose to pursue a finance degree?
In college, I actually began on a completely different track: pre-med/computer science. However, in college, it is a common experience to be exposed to — and explore — different subjects and areas of interest. Around this time, the 1987 stock market crash was a memory still fresh on the minds of many. The significance of that crash caused me to question how financial crises occur, and how investors can best to protect themselves from such events.
In the process, I began eagerly reading everything I could find on the subjects of finance and economics; and taking more and more classes in the Economics Department. Ultimately, I changed my major to economics. My own experience included an undergraduate liberal arts degree (BA) degree in economics, combined with a more specifically focused graduate degree (MBA) in finance & statistics.
What were the strongest skills you developed or built upon throughout your degree program?
In college, I learned that a successful undergraduate career is rooted in being open to exploring broadly different areas, modes of thinking, and subjects. It is a truly invaluable experience.
Unlike the career path for a more scientific or technical discipline, I have found that the best training for a successful career in business — specifically finance — is a general liberal arts education grounded in economics or finance, perhaps supplemented by further upper division elective courses in finance. The areas of study during my degree program that I have found most beneficial to my career include the development of critical thinking and analytical skills, interpersonal and teamwork skills, and a broad education of the social sciences (including psychology, sociology, and philosophy). Success in business, and finance careers in particular, require not only a strong command of various techniques, but also robust social skills and the ability to relate to others.
Alternatively, students that have dual passions (e.g., in engineering and business) may consider a technical undergraduate degree supplemented with a later graduate degree (MBA) in finance. Indeed, it is very common for students with an undergraduate degree in a social science (e.g., economics or philosophy) or in the traditional sciences, to continue their training with an MBA, after a few years in the workforce. In my many years recruiting professionals into investment banking and investment management, I have found that our best candidates have had varied undergraduate backgrounds — some motivated by an interest in the social sciences, others motivated by interests in other disciplines — but shared the important skills outlined above. In fact, the combination of either a scientific or liberal arts degree, combined with an MBA (after a few years of work experience) tends to produce the most successful professionals in the business.
What was the job outlook like after you graduated? How long did it take you to establish your career?
I graduated from the University of California in 1992. At the time, the US was just beginning to emerge from a recession, and job market prospects were mixed. I ended up doing consulting work for the US Government, and then utilizing those contacts to secure a position in law enforcement. I was able to combine my interest in law enforcement with my training in finance and economics. After the Police Academy, I was recruited to help develop and grow a new task force to combat white collar and economic crimes. It was one of the first of its kind in the nation. The lesson here was that opportunities can be created in unexpected ways.
After a few years, I decided to advance my career prospects by furthering my training and obtaining my MBA at the University of Chicago. Although the job market prospects were again mixed upon graduating, I quickly learned about the “golden rule” of securing a job: network, network, network! I called upon undergraduate professors that had Wall Street experience, former consulting contacts, and even law enforcement colleagues to find people in common that could connect me with a job opportunity. By doing so, I was able to secure an internship (between my 1st and 2nd year at University of Chicago) with Goldman, Sachs & Co. in Wall Street. The internship was essentially a three-month interview. Ultimately, I landed a permanent position with Goldman Sachs at the end of the summer. This made my second year at grad school much less stressful.
I treasure my experiences at Goldman Sachs. Given their extensive (eight month) training program, I learned a lot about various facets of the investment management and banking business. I grew to become an important contributor to the firm, and was named one of its youngest Vice Presidents. Where else can you network with prominent CEOs, help companies raise capital, orchestrate a leveraged buyout, or manage hundreds of millions of dollars — all while making 7 figures at the tender age of 25?
It also allowed me to create my own firm in 2000, which quickly rose to manage several billion dollars, and was ranked the #1 wealth management firm by Bloomberg Wealth Manager by 2006 and again in 2007.
As someone who has worked both in academia and in a firm, what advice would you give students considering different career paths in finance?
There are a number of paths available to students who choose a career in Finance. Among these are: investment/money management (working with investors), investment banking/corporate finance (working with issuers), financial operations, internal finance (working in a finance function within a company; sometimes called financial planning & analysis/FPA, treasury, or project management), commercial banking, real estate, teaching/research/academia, or working for a governmental agency.
Finance is a tremendously exciting career path as it permeates nearly every facet of business and is an essential personal, corporate, and governmental function. Moreover, the financial capital markets are ever-changing; allowing for dynamic and diverse experiences as professionals progress through their career.
It is very difficult to generalize or quickly summarize the difference between the various finance subsectors. The best way to learn about them is to interview professionals, build a network, and try to secure internships during your summer years. During these internships, you will get a visceral feel for whether you want to work in high pressure/high energy trading environments where second-to-second decisions can mean the difference between success or failure; or whether you would rather spend hours poring over accounting statements and running valuation analyses to determine how best to merge two companies. There are few substitutes for genuine work experience!
It is also important to note that you should view your undergraduate (or to some extent, your MBA) training as simply preparatory training for your career. Very likely, you will learn much more specific techniques and strategies on-the-job. For example, as a finance professor today, I teach the Capital Asset Pricing Model (CAPM) as part of the introductory finance course for undergraduates. The reality is that CAPM is not used in this “textbook” way at most institutions. However, the general idea and economic themes that underlie the model DO carry forward to the workplace. So, I strongly encourage students to view their undergraduate education in finance as developing their analytical framework and “modes of thinking,” as opposed to simply memorizing or collecting highly specific techniques that will be used verbatim once they are in business. That said, please do study the course material so that you can get a good grade! Finance careers are highly competitive, and grades matter.
What type of person excels in this field?
Once again, it is difficult to generalize as to what specific type of person excels in Finance. During my term at Goldman Sachs, and again when I ran my own investment management firm, I interviewed, recruited, and hired many, many different types of candidates. Some of our most successful candidates were, variously: music majors, US Navy SEALS, philosophy professors, ex-CIA officers responsible for “disrupting hostile foreign regimes,” and of course finance majors and finance MBAs!
As opposed to a specific degree or experience, these successful professionals have cultivated and have the following personal characteristics: a highly analytic mind, a love of numbers, creativity and innovation, a competitive streak while also maintaining an attitude of teamwork, constant curiosity (in terms of trying to always understand the “how” and the “why” of an event), a “never give up” mentality, “thick skin,” and the ability to work long hours and still maintain discipline.
What additional advice would you give to prospective finance students?
A career in finance is absolutely exciting, dynamic, and constantly challenging. Your adrenaline will run high, you will meet interesting and fascinating people, and you will be at the nexus of economic, political, and social events. In many areas of the industry, it is also a true “meritocracy,” where your upside in terms of job mobility, compensation, and exposure can be potentially unlimited.
I have never regretted my choice to enter the wonderful world of finance!
What are the Best Careers for Finance Majors?
Finance professionals can choose from hundreds of different career paths grounded in economics, business, or money management. Students who choose to earn a bachelor’s degree in finance should carefully weigh their knowledge and skill sets before pursuing jobs after graduation. The opportunities for learners with a strong background in math and data analysis will vary from those who excel in economic theory and risk management. Location is another important consideration; most finance degree jobs are concentrated in major financial hubs, and you may have to relocate. The following section explores some of the most common careers for finance majors, along with a few options outside of traditional career paths.
Common Career Paths
Finance jobs are widely available in the private, public, and nonprofit sectors. Due to the specialized nature of most bachelor’s-level finance programs, undergraduate education can help students decide which role in finance they find most appealing. Some choose to work as advisors that offer financial guidance to businesses, individual clients, and lending institutions. Others specialize in math-driven fields, like data analysis and economic research. The following table includes some of the most commonly sought finance careers.
- Budget Analysts
- Mean Annual Salary: $71,590
- Degree/Certification Required: Bachelor’s
- Projected Job Growth Outlook (2014-24): 3%
- Number of People Employed: 60,800
Budget analysts study and interpret numerical data, evaluate organizational spending, and work closely with project managers to develop feasible short- and long-term budgetary plans. These professionals offer advice on budgetary matters like spending discrepancies and fund allocation. They also review budget proposals to ensure that they are financially sound, up-to-date, and compliant with all laws and regulations.
Most often, budget analysts work with entities like postsecondary institutions, government agencies, and nonprofit organizations. These positions require proficiency in math and data analysis, strict attention to detail, and strong communication skills. Coursework in math, accounting, statistics, and other related subjects will prepare students for a career in budget analysis.
- Mean Annual Salary: $99,180
- Degree/Certification Required: Master’s
- Projected Job Growth Outlook (2014-24): 6%
- Number of People Employed: 21,500
Economics is a data-driven field that takes a methodical approach to spending, risk assessment, and other financial matters. Day-to-day duties include analyzing data, forecasting market trends, and issuing reports about the state of the national or global economy. Economists develop policies, advise businesses and organizations about finance-related subjects, and write articles for publication in newspapers and magazines.
Prestigious jobs in this field typically require a master’s degree or PhD, but many employees begin their career at the bachelor’s level by earning a minor or specialization in economics. A strong background in math, statistics, and probability will also help you earn an entry-level job without an advanced degree. Many aspiring economists gain valuable on-the-job experience by taking part in undergraduate internships.
- Financial Analysts
- Mean Annual Salary: $80,310
- Degree/Certification Required: Bachelor’s
- Projected Job Growth Outlook (2014-24): 12%
- Number of People Employed: 277,600
Financial analysts study different types of qualitative and quantitative data in order to forecast market activity and evaluate potential investments. Some analysts work with corporations, government agencies, and other entities to optimize organizational spending, budgeting, and fund allocation. Others help individual clients who are seeking guidance about personal investments and asset management.
Undergraduate studies for financial analysts often incorporate a mix of accounting, statistics, mathematics, and economics. Students also take courses in portfolio management and risk assessment. Many bachelor’s programs prepare students for certification from the Financial Industry Regulatory Authority (FIRA), the leading licensure provider for analyst employees. Bachelor’s degree-holders may also be eligible to earn the Certified Financial Analyst (CFA) title after they have logged at least four years of professional experience.
- Financial Examiners
- Mean Annual Salary: $78,010
- Degree/Certification Required: Bachelor’s
- Projected Job Growth Outlook (2014-24): 10%
- Number of People Employed: 38,200
Financial examiners are responsible for reviewing data and budget proposals to ensure compliance with different laws and regulations. Some financial examiners specialize in risk scoping, monitoring activities and quality of management at financial institutions. Others work in consumer compliance, evaluating the ethics and fairness of lending agencies.
Roughly one-third of these professionals are employed at federal or state government offices. Another 18% work in credit intermediation, acting as middlemen between lenders and borrowers. Finance degree programs prepare examiners for their professional roles with coursework in business law, ethics, economics, and accounting. While a bachelor’s degree will be sufficient for obtaining an entry-level financial examiner position, advancement on this field may require either a master’s degree or Certified Public Accountant (CPA) licensure.
- Personal Financial Advisors
- Mean Annual Salary: $89,160
- Degree/Certification Required: Bachelor’s
- Projected Job Growth Outlook (2014-24): 30%
- Number of People Employed: 73,900
Most personal financial advisors provide guidance on all areas of personal investment, including insurance coverage, mortgage payments, college savings, retirement, and estate planning. In order to reach out to new clients and secure their business, advisors must spend much of their time networking at seminars, conferences, and other organized events. Bachelor’s degree programs prepare financial advisors through coursework in risk assessment, portfolio management, taxes, and accounting. These programs also emphasize business ethics and law, as trustworthiness is crucial to building a healthy client pool and maintaining positive relationships.
Many undergraduate programs geared toward financial advisors include preparation courses for required certifications and licenses; those who work for firms that manage client investments must pass the Securities and Exchange Commission exam, while private advisors who sell insurance must obtain a state-issued license.
Outside-the-Box Career Paths
Not all finance professionals work directly in finance. In addition to the careers listed above, many college graduates with degrees in finance pursue positions in fields indirectly related to money matters. Many work in organizational settings as statistical analysts, mathematicians, actuaries, or compensation and benefits specialists. Others pursue roles in industries related to personal funds and assets, such as insurance or real estate. Additionally, some find teaching positions in the finance departments of colleges and universities.
Qualified teachers who can communicate with students about financial matters are in high demand. At the high school level, students are introduced to fundamental principles of economics, personal finance, and money management, as well as advanced mathematics and statistics. High school teachers are required to have a bachelor’s degree in order to earn a state-issued teaching license. However, the bulk of finance-related education is delivered at the postsecondary level.
Most educators at four-year colleges and universities are expected to have earned at least a master’s degree in their field of expertise, and many also have a PhD. Aspiring finance professors should focus on building their knowledge and skill sets during their undergraduate studies before deciding to pursue a graduate-level teaching credential.
- Human Resources
Human resources is a broad professional field dedicated to maintaining safety, fairness, equality, and productivity at different workplaces. Many divisions of human resources are concerned with financial matters. Benefits and compensation specialists evaluate salaries, health insurance coverage, and other employee incentives to ensure their company’s offerings are both competitive and economically viable. Graduates with a finance degree and a strong background in accounting and business administration are often selected for benefits and compensation roles.
Management analysts (also known as management consultants) work alongside top executives to develop and implement different proposals aimed at increasing efficiency and minimizing risks. While management courses are limited at the undergraduate level, students can bolster their competencies in this area by taking courses in business administration, finance, marketing, and economics.
Most undergraduate finance programs include math course sequences, as well as courses in numbers-driven fields like statistics and probability. Many firms, insurance companies, and lending institutions employ teams of mathematicians and statisticians dedicated to analyzing financial data for significant patterns and trends. Another financial division concentrated in mathematics is actuarial science.
Primarily employed in the insurance sector, actuaries help organizations and individual clients develop effective financial policies, reduce unnecessary spending, and mitigate risks. Additionally, finance students with a background in mathematics and IT may consider a career as operations research analysts. Similar to data analysts, these employees help organizations optimize workflow and minimize risk in areas like logistics and supply chain management.
- Public Sector
A background in economics, statistics, and finance can benefit college students who plan to pursue certain positions in the public sector. One example is a role as a survey researcher. These professionals compile and analyze data in order to study economic factors like unemployment and gross domestic earnings; they also issue public surveys to learn different opinions about specific issues for research purposes. A master’s degree or PhD is required for many research positions, but bachelor’s degree-holders can gain entry-level employment if they have a strong background in statistics, data analysis, and research methods. Another public sector option is urban and regional planning. Professionals in the field develop land use plans guided by financial costs, zoning restrictions, environmental conditions, and other key factors. Any finance major who is interested in this career path should supplement their economics coursework with classes in geography, political science, and environmental science.
- Real Estate
Real estate employees work with organizations and individual clients who are seeking advice about houses, office buildings, and other physical properties. In order to succeed in real estate, candidates must have a strong background in economics, personal finance, and business law. Real estate brokers and sales agents work directly with clients who wish to buy, rent, or sell properties. Like financial advisors, they are expected to consult with clients on pricing, mortgage rates, and market trends.
Appraisers and assessors of real estate evaluate properties based on certain factors (such as age, condition, and size) and issue objective values based on their findings. Similarly, claims adjustors in the home insurance industry investigate claims and decide how much money (if any) the insurance provider should pay out to the individual or organization filing the claim.
- Institute of Management Accountants (IMA): Founded in 1919, this professional organization with more than 80,000 members features networking events, continuing education opportunities, and other services for accountants and finance professionals. The IMA also offers the Certified Management Accountant (CMA) credential.
- National Association of Insurance and Financial Advisors (NAIFA): This D.C.-based organization focuses on advocacy, professional development, and networking events. Advisor Today the NAIFA’s journal founded in 1906, is the most widely circulated insurance publication in the country.
- Association for Finance Professionals (AFP): This interdisciplinary professional organization administers two credentials — the Certified Treasury Professional and the Certified FP&A Professional — and hosts an annual conference.
- Accounting & Financial Women’s Alliance: This professional organization aimed at female employees in the finance world boasts a network of more than 2,500 members.
- Investopedia: Considered one of the largest financial websites in the world, Investopedia features a compendium of articles, news blurbs, and other materials dealing with all aspects of corporate and personal finance.
- Kiplinger: This online magazine offers financial advice and money market forecasts. Subscribers can request two Kiplinger print publications: a weekly newsletter for management professionals or a monthly magazine aimed at private consumers.
- Global Finance: Founded in 1987, this monthly English-language publication discusses various financial and economic issues in different regions of the world.
- Business Finance: This online magazine examines topics related to corporate finance, including human resources, budgeting, risk management, and business technology.
- eFinancialCareers: This online job board lets you browse positions in banking, accounting, insurance, and finance using an aggregator that can be filtered by location and professional title.
- ‘A Day in the Life of a Corporate Finance Analyst’: This blog post found on mergersandacquisitions.com whimsically describes the daily routine of a high-profile financial analyst and business consultant.