One of the most important elements of any business is finance. Like accounting, finance addresses the financial health and management of an organization. However, unlike accounting, which deals with a diverse range of business functions across almost every industry, finance has a much narrower focus. Specifically, finance involves balancing risk and profitability, while striving to maximize an entity’s wealth. A few functions performed by finance professionals include capital budgeting, business valuation, real options valuation, financial modeling, investment management, risk management, project management and financial accounting.
Careers in Finance
While opportunities in finance are not as diverse as they are in accounting, there seems to be a never ending list of exciting and fulfilling career opportunities for finance professionals. The following are just a few of the more popular careers in finance.
- Corporate Finance – Corporate finance professionals and officers work with companies to help them raise capital needed to finance operations, grow their business, make acquisitions, manage their cash and assets, and plan their financial future. Ultimately, corporate finance officers are responsible for creating value for a company.
- Commercial Banking – Careers in commercial banking are exciting, diverse and provide for substantial career advancement opportunities. A few of the job opportunities available in commercial banking include Credit Analyst, Loan Officer, Branch Manager, Trust Officer and Mortgage Banker.
- Financial Planning – Financial planners, also known as wealth managers, help individuals plan for their financial futures. Specific services they may provide include retirement planning, investments, estate planning, and taxes. Many financial planners obtain the Certified Financial Planner (CFP) designation.
- Insurance and Risk Management – Insurance is a stable industry that provides diverse careers and advancement opportunities. Careers in insurance revolve around helping clients understand their insurance needs and making sure they are adequately protected against potential risk. Popular positions within this field include insurance agent, risk manager, asset manager, actuary, and underwritter.
- Hedge Funds – Hedge funds manage a pool of money for large investors. While many finance professionals aspire to work as a hedge fund manager, most start out working as strategists, analysts, risk managers, or in one of many administrative roles. Working in a hedge fund can be exciting and lucrative, but it isn’t for everyone.
- Money Management – Money managers buy and hold stocks, bonds, asset-back securities, mortgaged-backs, munis, agency securities and other financial derivatives for their clients. Some money managers use sophisticated quantitative techniques and methodologies to manage their clients money, while others rely on simple intuition and experience.
- Private Equity – Some of the most sought after careers in finance are in private equity. Private equity firms are involved in leveraged buyouts, private equity investments, and partial stake purchases in public companies. The entry-level position in private equity is an analyst (undergraduate degree) or associate (MBA or masters degree). Careers in private equity require long hours and the field can be stressful–but compensation is high for those who succeed.
- Real Estate – Nearly a third of all the wealth in the world is tied up in real estate. Real estate careers are exciting, rewarding, ever evolving and challenging. Popular career fields include real estate appraisal, real estate development, lending, brokerage and leasing, title insurance and sales.
- Investment Banking – Investment banks help their clients issue securities (raise money), purchase securities, manage financial assets and provide financial consulting services. Entry-level positions include analyst (undergrad) and associate (MBA or masters).
Education and Training
A career in finance requires a unique skill set. You need to be good with numbers and computations, but you also need to be good with people. While part of a finance professionals life is dedicated to crunching numbers and performing financial analysis, much of it is spent interacting with clients, giving presentations and working with other professionals in the banking industry. One day you may be in your office developing a capital budgeting model and the next trying to convince a banker why he should provide your company the capital it needs to grow.
The minimum level of education required to qualify for most finance positions is a bachelor’s degree, but most employers these days prefer a master’s degree in finance, accounting or business administration (MBA). Positions that typically require a master’s degree involve upper-level financial management. However, more and more firms are now requiring a master’s degree for their entry-level financial analyst positions.
Many people who pursue a master’s degree in finance do so while working full time, as a way to enhance their job opportunities and advance the career. In addition to earning a master’s degree there are several industry certifications and credentials that you should consider if you want to position yourself as an expert within your field. These include Certified Public Accountant (CPA), Chartered Financial Analyst (CFA), Certified Management Accountant (CMA), and Certified Financial Planner (CFP), to name just a few. As many finance students work full time, online college classes and degrees programs have become an increasingly popular means for financial professionals to acheive their educational goals.
Finance Degrees and Programs
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