A Brief History of the Finance Major
The University of Pennsylvania founded the first collegiate business school in 1881, the Wharton School. This marked the beginning of what is known as business education in the United States. Wharton School was purposed to provide young men with an education that was based in finance and economy in order to prepare them to be leaders in business and government. Given the business is the business of making money, the discipline of finance has always been closely related to that of business management. One of the early leaders in finance education was Edward Sherwood Mead who as student at Wharton was the first to specialize in corporate finance. He later became a professor at the University of Pennsylvania and in 1910 published one of the earliest textbooks on the subject. Today, as the business world has expanded so has the field of finance with several different sectors in the industry including public finance, personal finance, and corporate finance.
Delving Into the Finance Major
Majoring in finance is a great way to prepare yourself for the business world, especially if you have an aptitude for math and enjoy working with numbers. In an increasingly turbulent financial world, companies are looking for financial experts who will be able to both predict future prospects for their company, therefore, finance programs are designed to give students the math and statistics skills to evaluate markets and judge the strength of investments. Overall, students seeking a degree in finance should be interested in developing their problem-solving and business skills.
A major in finance will require students to take many standard business classes like management, economics, business ethics, and communication. Finance courses will include the more advanced study of investment strategy and banking as well as market analysis, securities, and cost control. In a business world that is increasingly interconnected and codependent, those studying finance will also have to gain an understanding of how world markets work together and influence each other through courses in international finance and trade. Finance majors may be able to concentrate on specific specializations including the growing field of microfinance and international development. As markets and finance become more integrated and therefore more complicated, all finance programs will also include computer classes which will help students to use the financial programs used in today’s businesses.
Degree Levels:
Associate
Students pursuing an associate degree in finance are introduced to fundamental principles in accounting, statistics, business administration, and financial management. These types of programs generally take two years to complete and require students to earn around 60 credits through courses like principles of finance, business law, principles of management, risk management, and financial statement analysis. Graduates of an associate program will develop the basic knowledge necessary to understand, analyze, and manage finances. As a foundational degree, an associate in finance may be awarded at a two-year college or used to transfer to a four-year college or university to pursue a higher-level degree.
Bachelor’s
Those who decide to earn a bachelor’s degree in finance will receive an education that integrates business practices with the study of financial management. Students will learn how to apply their knowledge in such a way that they are able to analyze an organization’s financial situation, implement strategies to manage finances, and develop plans to reach financial goals. Common courses include foundations in finance, financial markets and institutions, fundamentals in management, statistics for financial analysis, risk management strategies, and investments and portfolio management. These types of programs generally take about four years to complete and require students to earn around 120 credits. A bachelor’s degree in finance will prepare one for numerous graduate and doctoral degrees in various business areas.
Master’s
Those interested in a graduate education within this field can earn a master’s degree in finance or an MBA with a finance-related concentration. A master’s degree program within finance incorporates advanced study of financial analysis, corporate finance, investment management, and managerial accounting. These types of programs require students to complete at least 30 credit hours beyond the baccalaureate degree and can take up to three years to complete. An MBA with a concentration in finance consists of advanced courses in core business subjects with the option to take several elective courses within finance. Generally, MBA students are required to complete anywhere from 48 to 60 credit hours, which can take from one to three years to complete depending on program format.
Doctorate
Those interested in research or education can pursue a Ph.D. in finance which goes a step further than a master’s degree. It consists of advanced coursework and research studies concerning financial markets, valuation of assets, financial decision making, theoretical modeling, and empirical testing. Doctoral-level finance programs are designed for those who wish to pursue an academic career or apply their knowledge financial research. These types of programs may also require students to complete a residency, doctoral study project, or thesis. A Ph.D. can take from three to four years to complete and require students to complete a minimum of 84 credit hours of graduate coursework.
Supplementing Your Finance Major
The practices and principles of finance are not only applicable, but essential to almost every industry and field. There are many related and complementary areas of study that can be beneficial for students who wish to expand their academic knowledge and define their area of expertise. Given its range of relevance, there are various specializations within finance itself and those who wish to pursue a career within a certain niche of finance may want to consider choosing a concentration. Some colleges may offer these types of specializations a formal concentration area while others may only provide elective courses within them. Some common concentrations within finance include managerial finance, financial services, risk management and insurance, corporate finance, and banking and financial institutions.
Another way that students can further their expertise and define career paths is through choosing a minor. Common minors for finance majors include economics, political science, mathematics, philosophy, and business. Minors can also be chosen depending on the type of organization or industry a student has a financial interest in. Those who are interested in managing finances within the high-tech industry may want to minor in an area such as information technology, communication technologies, information sciences, or computer science. If it is one’s desire to work for a health care organization, they may consider a minor in health sciences, public health, clinical nutrition, or health administration, while those who want to work in the retail industry should look into related minors such as consumer sciences or fashion merchandizing. Additionally, those who want to use their educational background in finance to help a non-profit organization may find minors within social sciences or humanities beneficial.
Learn More About the Finance Major
- U.S. News and World Report: Undergraduate Finance Program Rankings
- MIT OpenCourseWare: Financial Management
- FINS: Finance Career News
The Finance Major in the Job Market
The skills gained while pursuing a finance degree will prepare degree holders for everything from money management to investment strategizing. All businesses will need employees that are skilled in the area of finance and degree holders will have the flexibility to move into any corporate environment. Additionally, every company needs a strong finance department. As a result, the employment opportunities for those with a degree in finance are numerous. Finance degree holders move into careers in actuary firms, banks, and investment firms as well as with consulting companies and accounting firms. Salaries depend on the level of education and the field in which degree holders work and average salaries can range from $40,000 for smaller firms to $60,000 to $70,000 for larger firms. Advanced degrees and experience can garner much larger salaries.
Those with an undergraduate degree in finance can pursue careers as financial analysts, personal financial advisors, or financial services sales agents. Financial analysts help businesses make wise financial decisions by assessing an organization’s investments, securities, costs, sales, risks, and funds. Personal financial advisors examine the finances of individuals and help them make the best decisions regarding personal investments, insurance, savings, and retirement plans. Financial services sales agents are also known as investment bankers, stock brokers, and traders. They provide advisory services advising individuals and organizations on security investments and arranging these investments for them. The Bureau of Labor Statistics reported that in May 2008 the median annual wages of financial analysts were $73,150, while personal financial advisors made $69,050 and financial services sales agents made $68,680.
Those who decide to obtain a graduate-level education in finance, earning a master’s or Ph.D., can pursue careers as finance directors, Chief Financial Officers, or financial managers. Essentially, those in these types of higher-level positions oversee an organization’s finances, including activities related to financial reports, investments, and cash management, as well as implement strategies to reach short and long term financial goals. According to PayScale, the annual salaries of finance directors range from $71,140 to $144,873, financial managers from $45,637 to $85,044, and Chief Financial Officers from $84,798 to $172,376. In addition, those with a finance degree will have the building blocks necessary to start their own business which adds the freedom and independence people often look for in their careers.
Careers I Can Get with This Degree:
