In a nutshell: Financial managers are essential professionals that help companies track their performance, manage their investments and determine which projects provide the best return. The field provides many opportunities in a variety of industries and organizations.
For someone with a knack for numbers and an affinity for business, becoming a financial manager is a natural fit as a career.
It’s an especially attractive option if you feel comfortable with numbers, but don’t necessarily want dealing with them to completely define your work day. Financial managers have much more complex and interesting job duties that go well beyond recordkeeping.
Accounting and financial management are two very different things.
As a financial manager, you aren’t simply concerned with making sure column A balances with column B. Financial managers focus on profit maximization. They develop strategies to raise money for an organization’s operations. That includes the challenging task of managing investments — knowing where to invest money, when to buy and when to sell.
It’s a challenging career field that requires not only knowledge of numbers and financial markets but critical thinking and decision-making skills.
It’s also a career field that is growing quickly.
Career Paths In Financial Management
Earning a degree in financial management prepares you for jobs in a variety of areas. Some larger companies have financial functions that include financial managers. Advisory firms — KPMG and Ernst & Young are among the best known — also hire financial managers to provide service to their clients.
And for those with entrepreneurial ambitions, it’s also possible to set up your own financial management agency and build a client base.
Government agencies also require finance professionals to manage public funds. For example, at the federal level, the U.S. Department of the Treasury has a Financial Management Service that focuses on improving cash management systems across all U.S. government agencies.
Exact job duties and titles vary by organization and your position on the corporate ladder. But frequently used titles include:
- Chief Finance Officer
- Vice President For Finance
- Director of Finance
- Director of Financial Reporting
- Finance Manager
- Finance Advisor
- Finance Analyst
- Finance Associate
- Financial Planner
- Investment Counselor
Whatever the title, keep in mind that the focus is on improving company cash flow and managing investments well. Again, profit maximization.
Education for Financial Management
Given the importance of the position and the level of responsibility, becoming a financial manager requires a bachelor’s degree at the minimum.
To reach the higher levels in the field, some employers will want job candidates with master’s degrees. Those include a master’s in finance, obviously, but also business administration and economics, according to the U.S. Bureau of Labor Statistics.
While seeking a degree can prove difficult because of the demands it puts on time, the emergence of online education has changed the situation for the better. Students can now earn a degree in business administration with a focus on finance or an MBA in Finance through quality online programs that offer flexibility not found in on-campus classes.
Certification also is key to a successful financial career. There are many available, but three of the best known are:
- Chartered Financial Analyst: Awarded by the CFA Institute
- Certified Treasury Professional: Awarded by the Association For Financial Professionals
- Certified Public Accountant: Awarded by the American Institute Of Certified Public Accountants
Skills Needed for Financial Management
Given the scope of the job, successful finance managers need a range of skills. Beyond the obvious need for expert-level knowledge in dealing with numbers, cash management and financial markets, these other “soft skills” also apply.
You can’t deal well with many different people across a variety of departments — especially when the topic involves the company’s cash — without outstanding verbal and written communication skills. As with any person in a job that requires specialty expertise, you must hone the ability to break down financial lingo into terminology that those without your knowledge will understand. Otherwise, it’s impossible for them to make the correct decisions based on your findings and recommendations.
Use of Technology
There isn’t a profession untouched by technology innovation, and that includes finance. While software systems have evolved to the point where collecting and analyzing data is easier than ever, finance managers need a keen understanding of how to use these systems. They also need to know the proper way to applying analysis to large datasets.
Critical Thinking, Decision Making
Otherwise known as “analytical thinking,” it’s a requirement for successful financial managers. Like any other specialists, financial managers are hired because they have the ability to assess a financial situation, research options for profit maximization (including potential investments) and decide which options are best to recommend. It’s a challenge. But if you have high-level critical thinking and decision-making skills and the personality to handle the challenges associated with these decisions, it’s a great fit.
Growth and Salaries in Financial Management
So, what’s the payoff for acquiring the education and honing the skills needed in financial management? According to the BLS, the median pay for financial managers was $121,750 in May 2016. The top 10% in the field earned a median salary of $208,000.
While these numbers are a good starting point, it’s important to know that salary figures vary greatly depending on job title and geographic location. They also differ by industry. For example, the BLS reports that a financial manager in government makes less ($109,230) than one in professional services ($142,300).
Clearly, becoming a financial manager is a solid choice for those with the right mix of education, skills and personality. If you have those qualities, it’s a career field worthy of your consideration.