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A financial career path offers a number of interesting, entry-level jobs that can develop into significant senior-level positions. In addition to a strong finance education, you’ll need to be familiar with both accounting and economics. Along with possessing strong analytical skills and the ability to assess financial data, you’ll need to work effectively with colleagues throughout an organization. So you’ll need good interpersonal and communication skills: you’ll have to write and speak clearly and, in particular, you’ll have to be able to present complex financial data in terms that everyone can understand.
Generally, most positions in finance fall into one of three broad areas: commercial banking, corporate finance, and the investment industry.
Commercial banks employ finance professionals as loan officers to work with clients requesting personal or business loans. It’s the borrower’s responsibility, of course, to present a clear and coherent application, and it’s the loan officer who evaluates it—who decides whether the borrower will be able to meet the terms of the loan. Finance professionals also manage the deposits made at commercial banks, providing the bank with additional revenue by investing funds that don’t go into loans.
Every organization needs financial expertise. Large companies need finance professionals to manage their cash, their debt requirements, and their pension investments. They’re responsible for securing capital (whether through debt or equity), and they may be called on for any of the following tasks:
In smaller firms, all these tasks may fall to a single finance professional. In addition, both large and small companies may occasionally use the services of financial consultants. They may be provided by investment bankers, by specialized consulting firms, or by the financial-advisory departments of a major accounting firm.
From an entry-level position—usually called analyst or junior analyst—the finance professional will advance from senior analyst to a managerial position. With each step, you’ll have greater exposure to senior management and face more important and more complex issues. Within ten to fifteen years, you may become a director or vice president. The rungs on the career ladder are pretty much the same in consulting and investment banking.
In the investment industry, finance professionals can be stockbrokers, investment analysts, or portfolio managers. Each of these positions requires an ability to assimilate great quantities of information, not only about specific companies and their securities, but also about entire industries and, indeed, the economy itself.
Some investment professionals work directly with individual clients. Others provide support to those who make sell or buy recommendations. Still others manage portfolios in the mutual fund industry. A mutual fund gathers money—ranging upward from a few hundred dollars—from thousands or even millions of investors and invests it in large portfolios of stocks and other investment securities. Finance professionals review and recommend prospective investments to company managers.
Because real estate (both commercial and personal) and insurance are investment fields, many financial professionals can be found working in these areas, as well.
After completing the undergraduate degree with a major or concentration in finance, accounting, or economics, a finance professional may start to think about graduate school. The typical path is an MBA with a finance track. Though some schools offer a master’s in finance degree, such a program is highly specialized, with rigorous math requirements that may not appeal to everyone with an interest in finance.
Certification is a means of achieving professional distinction in a finance career. The most popular certifications include the following:
The insurance and real estate industries have their own certifications. In addition, because the federal government requires anyone who sells securities to be licensed, there is an entire set of licensing procedures that must be followed.
See “Cases and Problems—Career Opportunities,” below.