What’s the Average Salary for a Finance Major?
What is the average salary that a finance major can expect? At first glance, it doesn’t appear that a degree in finance is the ticket to a career with stellar pay. The average recipient of a bachelor’s degree in finance takes in $101,038 a year. When you consider all bachelor’s degree recipients, the median (half earn less, half earn more) is just slightly lower: $93,664.
Dig a little deeper, however, and it becomes apparent just how many finance-related careers pay well above average. Here’s a look at how you can expect to fare in some of the field’s more common occupations.
- Graduates with a finance degree can work for a wide range of employers, from Wall Street banks and insurance companies to financial-planning firms.
- Some finance graduates go on to pursue a CPA license, although it will likely require additional accounting coursework at the undergraduate or graduate level.
- Financial analysts are among the better-paid professionals in the field.
- The types of jobs finance majors can choose from vary greatly, including investing banking, equity research, financial planning, budget analysis, and Treasury analysis.
Some people feel less comfortable making financial decisions, such as buying life insurance and investing for retirement, than others do. That’s why there’s considerable demand for financial planners, who can help these individuals strategize.
Financial planners often work for insurance companies or brokerage houses, often as representatives who make commissions based on the products they sell. An independent advisory representative (IAR), on the other hand, works for fee-based (i.e. non-commissioned) advisory firms or sets up their own planning business. Often, IARs provide a broader range of services, such as budgeting and tax guidance, in addition to offering investment advice.
A personal financial advisor’s median annual compensation in 2021 (the latest data available) was $94,170, according to the U.S. Bureau of Labor Statistics (BLS). What’s more, employment within the field is expected to increase by 5% between 2020 and 2030.
Corporate Finance Professional
Major corporations often have entire departments tasked with helping the company raise and manage the capital that fuels their operations. Finance majors can pursue a number of different paths in corporate finance, most of which tend to pay very respectably.
Those who work on the treasury team, for example, help the company manage its cash, develop a strategy for short-term investments, and analyze foreign exchange (forex) transactions. A job as an entry-level treasury analyst pays a median of $60,000 a year; however, corporate treasurers, who have more experience, make a median salary of $199,750.
Meanwhile, the median pay for budget analysts—the professionals who examine how the organization spends money—is a solid $54,750.
People who work in wealth management roles help high-net-worth individuals manage their assets, with an eye toward maximizing returns and mitigating financial risks.
Junior-level associates may find themselves handling an array of tasks, including helping to research different investment options and preparing presentations. Later in their career, however, they may take on management roles and shoulder greater responsibility for investment strategies.
To work in the financial sector, an individual does not need a finance degree, though it helps. Individuals with various majors work in finance and have high-paying and well-respected positions.
Individuals who develop this expertise typically make a good living, with the average wealth management professional enjoying an average base salary of $85,348, according to the job-search website Indeed.
While the responsibilities of financial analysts can vary based on where they work, their basic role is to help large organizations make prudent investment decisions. They may examine economic trends, meet with a company’s management team, and pore over financial statements in order to develop an appropriate investment plan.
Typically, they use that information to develop financial models that help predict the potential outcome of different strategies.
The work of financial analysts breaks down into two basic categories: Buy-side analysts often work on behalf of insurance companies, foundations, and other institutional investors, providing advice to the money managers responsible for those clients.
Sell-side analysts, on the other hand, are employed by brokerage firms and provide their clients with recommendations on whether to buy or sell certain securities.
The median pay for analysts in 2021 was $81,410 per year, according to the BLS.
Major investment banks such as J.P. Morgan and Goldman Sachs need people who can advise companies on how to raise capital as well as how to go about acquiring or merging with other businesses.
It’s a fast-paced career that can involve some very long hours—especially at top Wall Street firms—but it certainly pays well for those who are successful.
Investment banking is one of the more financially rewarding careers, but those in entry-level jobs can work more than 80 hours a week at bigger firms.
According to data from Wall Street Oasis, analysts, who are on the lowest rung, start at anywhere from $100,000 to $120,000. Once you become an associate, you’ll likely bring in between $150,000 and $200,000 a year (and those who make it to “vice president” earn even more).
The role of a management analyst—sometimes known as a management consultant—is another well-paid career you can seek out with a finance degree. According to BLS data, the median pay in 2021 was $93,000.
Management consultants help businesses identify ways to cut costs and boost revenue. To do that, they have to possess strong financial analysis skills as well as an understanding of the competitive landscape in which a firm operates.
They may, for example, help a company focus its resources on markets where the firm can achieve greater profitability.
The most obvious path to becoming an accountant is to get a bachelor’s degree in—you guessed it—accounting. But an undergraduate finance degree lets you cast a wider net when it’s time to get a job. And with some extra coursework, you can still sit for the CPA exam, an accreditation that leads to higher pay than non-CPA accounting roles.
Most states require students to obtain 150 semester hours of coursework in order to obtain a CPA license. Strictly speaking, you don’t need a master’s degree to take the exam. But if you’re a finance major, getting there may require a graduate degree in accounting or a Master of Business Administration (MBA) with a concentration in accounting.
According to Payscale, the average annual salary for CPAs is $90,000.
Before lending money to businesses or individuals, banks need to have a reasonable expectation that the borrower will pay them back. One of the main responsibilities of loan officers is to assess that risk.
They’ll often talk to loan applicants and evaluate their borrowing history before making a recommendation to the bank or mortgage company for which they work.
According to the BLS, the median pay for loan officers in 2021 was $63,380 per year. It appears that the job market for these professionals will remain fairly steady over the next few years, with the BLS estimating just 4,300 new loan officer jobs added between 2020 and 2030.
What Careers Can You Choose With a Finance Degree?
There are many careers those with finance degrees can pursue. Careers suitable for finance degrees include insurance agents, financial analysts, investment banking, commercial banking, real estate agent, accountant, risk management, and equity research.
Can You Make a Lot of Money With a Finance Major?
Yes, you can make a lot of money with a finance major. The ability to make a lot of money with a finance major comes down to the job an individual chooses. There are a variety of jobs in finance and not all pay equally. Investment banking is one of the highest paying jobs in finance, with recent graduates making between $100,000 to $120,000. As an investment banking career progresses, so does the salary.
Is Finance a Hard Major?
Finance is a somewhat difficult major. It is much harder than certain liberal arts majors, such as history and philosophy; however, it is not as hard as the “STEM” majors: science, technology, engineering, and math. The difficulty with finance comes down to its concepts that students would not have experienced before in their lives, the financial lingo in the field, and the concentration of math in the subject.
The Bottom Line
While finance degrees overall may not pay more than other educational tracks, there are plenty of finance-related jobs that are very lucrative. Some of the careers that pay the most, such as investment banking, involve very long hours, so anyone concerned about work-life balance might want to look elsewhere.