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Understanding The Career Choices in Finance

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If you’re in college studying finance or accounting (or business, or anything else really), you may wonder what options you have for a career in finance when you graduate. There are a few main career choices in finance, with many many more sub-paths that most people follow.  You may think that your only option is a job on Wall Street, but in reality, that is where the fewest financial jobs lie.

Here are the main finance career choices: corporate finance, Wall Street finance, and personal finance, and the various choices within each of them.

corporate financial analystCorporate Finance

Corporate finance is probably the main career choice in finance since just about every company needs some type of financial management.  And, the larger the company, the larger the financial support apparatus needs to be.  In corporate finance, the main jobs are related to:

  • Financial Analysis (Calculating profits and losses and administering contracts)
  • Financial Forecasting (Future financial planning)
  • Dealing with Accounts Payable and Receivable (Negotiating lines of credit and/or dealing with vendors)
  • Preparing financial statements (Internal Accounting)
  • Coordinating with Outside Accounting Auditors

Also, depending on the company, you could be involved in mergers and acquisitions, where you would evaluate the prospects of purchasing or taking over another company, and what impact that would have on your company.

I also want to include accounting in this bucket.  Since every publicly traded firm has to have audited financial statements, third-party accounting firms are huge employers.  Starting accountants can get a high paying job at one of these firms right out of school.  However, these firms are known to just wear their employees down with the rigor of work.

The main job titles found in corporate finance are: financial analysts, accountants, auditors, and then Sr.’s and Directors of each of these roles.

wall street stock trader brokerCareer Choices in Finance on Wall Street

For Wall Street jobs, I actually group a large number of career choices in finance together that are traditionally associated with Wall Street.  The reason is that these jobs are usually a part of the big banking houses that Wall Street is known for.  In this bucket, there is commercial banking, investment banking, hedge funds, and private equity.  In each area, there are specific jobs that may be appealing.  However, Wall Street jobs are some of the most highly sought after by college graduates, so getting them can be difficult.

Commercial Banking is just like it sounds, they offer the commercial banking services that many of us are used to: checking, saving, loans, and more.  At the local level, there are jobs like tellers and bank managers, but at the corporate level, there is the full range of positions relating to lending, operations, marketing, and international finance.

Investment Management is the darling of Wall Street, as it is what is usually featured in movies depicting Wall Street.  Jobs in investment management are all related to the securities industry, whether corporate securities or government debts.  In a traditional investment bank, the main jobs are:

  • Traders (Working at a trading desk, and can be related to stocks, bonds, derivatives, and more)
  • Analysts (The ones who put together the reports on securities)
  • Lots of back of house operations (accounting, legal, and more)
  • Merger and Acquisition Specialists
  • Public Offering Specialists
  • Sales teams to gain company’s business
Hedge Funds are probably the next biggest “talked about” group of companies on Wall Street.  Love ’em or hate ’em, they can be big players when it comes to investing, and they usually hire great talent to get great results.  Hedge funds usually have the following jobs:
  • Financial Analyst
  • Trader
  • Compliance Officer
  • Quantitative Analyst (These are the super-smart guys doing the technical trading)
  • Marketing Manager
  • Portfolio Manager
Private Equity and Venture Capital is the last big area of Wall Street finance, but many times, private equity firms usually stay away from Wall Street in favor of start-up hubs like the West Coast.  Private equity firms are the professionals that provide capital to companies (usually start-ups, but also for buy-outs and restructuring).  Jobs in private equity and venture capital are wide ranging, since you may be required to wear multiple hats.  These companies employ some of the traditional analysts, but usually are held by partners who are experienced in these types of deals.

personal finance financial planning jobPersonal Finance Jobs

The last of the career choices in finance are jobs that help the individual consumer.  Many of these jobs aren’t for new graduates, as most professionals in this space have done their part in the other buckets, either working for a major investment or banking firm, or spending time at a major accounting firm.

The major spaces in personal finance jobs include financial planning, insurance, and accounting.

Financial Planning advisers are individuals who help others develop their current and future financial plans.  There are multiple facets of this job, and this job can be part of a larger company, or a small, locally based firm.  Most planners either charge a flat fee (fee based), or a percentage of the assets under management.    Generally, financial planners have already served in the investment industry, and are looking to help more individuals.  They also usually have their Certified Financial Planner (CFP) designation.

Insurance is a huge industry that serves both corporate and individuals.  However, for most college grads, getting into insurance means selling insurance to individuals or small businesses.  Most insurance jobs are with large, nationwide companies, and will involve sales (unless you get into risk management or underwriting).  The main jobs in insurance are:

  • Sales
  • Customer Service
  • Risk Management
  • Underwriting

Finally, there is Accounting.  The field of accounting is huge, and you can be an accountant in any of the buckets above.  Public accountants record business transactions, prepare financial statements, audit financial records, and prepare income tax returns.  They also usually provide consulting and advice services to the businesses and individuals they serve.  Many accounts start in a big accounting firm, and then transition to personal finance once they’ve acquired the needed skills.  In personal finance, accountants help with small businesses and preparing taxes, as well as help with financial planning for individuals as well (usually tax related).

Readers, do you have a career in finance?  Do you have any advice for upcoming graduates who are seeking a career in finance?

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