Financial Management


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The average value of the Bachelor degree needed to become a Financial managers is $1,716,904.00.

Financial manager careers are a lucrative industry with average job prospects and high pay. Although the competition for these positions is stiff, for those that get a financial manager job the career can be extremely lucrative. In order to learn more about the position and decide if it is right for them, an interested candidate should first know more about the career field. This will include the points of interest, nature of the work, training and qualifications, employment, job outlook, earnings, wages, and related occupations. 

Points of Interest

The financial management field is an extremely competitive career path to enter, as about 30% of working individuals have jobs within the finance and insurance industry. In order to be desirable to potential employers, job seekers need to have significant educational experiences. A minimum of a bachelor’s degree is required, and the area of study can be in accounting, finance, or a related field. Many employers also look for candidates that possess a master’s degree or certification from a professional organization, as well. However, the correct experience can also substitute for education. Experience in a management position with a financial institution, like the manager of a bank branch, will be a desirable characteristic companies look for in a potential financial manager. 

Nature of the Work

Almost every organization, government agency, business, and firm has at least one financial manager working for them. Financial managers are responsible for the reviewing and managing the monetary concerns of organizations and businesses. These individuals prepare financial reports; create strategies for cash management, and direct activities involving investments. They are required to use technical and computer skills in order to organize and record company data.

The duties performed by a financial manager will vary slightly depending on the person’s job title. Possible position titles that a financial manager can have include controller, treasurer, cash manager, risk and insurance manager, or a credit manager. A controller will be in charge of financial reports that summarize the company’s financial state as well as forecast it for future quarters or periods. This can be done through the use of balance sheets, statements of income, and an examination and analysis of future earnings. The controller will oversee the budget, audit, and accounting departments and will compose reports that are needed for regulatory agencies.

A treasurer can also be called a finance officer, and people in this position direct the objectives, budgets, and financial goals of an agency. They focus on mergers and acquisitions, invest funds, manage risks, ad supervise activities related to cash management. On the other hand, cash managers watch over the flow of cash disbursements and receipts in order to ensure that the business needs of the company are met.

Risk and insurance managers and credit managers are two other job titles that a financial manager could hold. The risk and insurance manager will attempt to minimize losses and risks that could occur during business operations and transactions. This includes the maintenance of the company’s insurance budget. The credit manager will work with the organization’s issuance of credit. Duties associated with this job require the manager to determine ceilings for credit, determine credit rating criteria, and collect on accounts that are past due. 

Training, Other Qualifications, and Advancement


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As stated earlier, a bachelor’s degree in a field such as finance, economics, accounting, or business administration, but many employers search for financial managers with a master’s degree. These programs are intended to develop analytical skills within the student and to teach methods and technology related to financial analysis. This makes these candidates more attractive to potential employers than those with less educational experiences.

In some circumstances, experience can outweigh education, especially in positions where an employee has been promoted. Bank managers, for example, are usually loan officers who have excelled at their job and have worked their way to the top. Some financial manager candidates also enter into a formal training program offered by the company and work their way into the position.

Professional certification is often desirable for financial managers to broaden their skill sets. There are many associations to that offer programs to become professionally certified, including the Association for Financial Professionals and the CFA Institute. Continuing education is also an essential part of maintaining certification, as laws and regulations are constantly changing and new financial instruments are continuously being invented and improved upon. These training programs include accounting management, information systems, international banking, cash management at the corporate level, and financial analysis.

Financial managers need to have a variety of different skills to be proficient at their jobs. Interpersonal and communication skills are two of the most important. Financial managers need to work as a team to solve company problems, and they have to be able to manage people. They must be able to explain complex data, think creatively, and solve problems. They must also have knowledge of finance at the international level because operations are becoming increasingly affected by the worldwide economy.

In addition to the skills needed to be a successful financial manager, there are also some personality traits that make a person better in this type of position. A financial manager needs to be adept at math and have a strong attention to detail. They need to act with integrity, consider alternatives, and act in the best interest of their client or business. They must also have strong negotiation skills in order to negotiate terms with players in the capital and financial markets. 

Financial Management

Employment

Individuals in financial manager positions held approximately 540,000 jobs in 2008. Financial managers can gain employment at a variety of financial institutions, such as credit unions, commercial banks, savings associations, loan associations, and mortgage companies. Three out of ten financial managers worked in these fields, which also includes banks, securities dealers, and insurance carriers. Another 7 percent worked for a government agency at the federal, state, or local level.

Some financial managers also choose to work for themselves. These individuals still need to have extensive training as an investment or financial manager, but they also should have business skills and the initiative to start their own business. Some financial managers that work independently choose careers and insurance brokers, stockbrokers, insurance brokers, or financial and investment consultants. 

Job Outlook

The employment growth for the industry of financial management is supposed to be equal to the average growth for all occupations. However, competition for these jobs will be extremely high, so a master’s degree or participation in a certification program will help candidates to have the greatest opportunities.

The Bureau of Labor Statistics has forecasted that financial managers will see an 8 percent growth of employment between 2008 and 2018. The need of companies for financial experience and knowledge will drive the growth of jobs, as will continuous changes of regulations and the expansion of finance companies. Bank branch manager positions are also expected to expand, as banks are continually adding new branches to their companies. However, there is some restriction to be expected, as companies are facing downsizing.

Financial managers will still be needed in the long run. Organizations will continue to need individuals to handle complex financial transactions and to manage growing investments. For short-term positions, some organizations hire financial managers for temporary positions. This is to help the company through a crisis and to offer suggestions to increase organizational profit. 

Earnings

The median annual wage for financial managers, excluding bonuses and stock options, was $99,330 in May of 2008. The middle half of financial managers earned between $72,000 and $135,000 annually. The industries employing the greatest number of financial managers included:

  • Securities, commodity contracts intermediation, and brokerage
  • Management of enterprises and companies 
  • Insurance carriers
  • Local government 
  • Depository credit intermediation 

Wages

According to the Bureau of Labor Statistics’ Occupational Employment information, the median annual wage for financial managers is $101,190 in 2009. The top 75 percentile made over $138,000, while the bottom 10 percentile made under $55,000. The top paying industry in this occupation was in securities, commodity contracts intermediation, and brokerage. The average mean wage in this industry was over $150,000 annually. The state that the financial manager works in also creates some variation in salary. The states with the highest concentration of financial managers include the District of Columbia, Connecticut, New York, New Jersey, and Massachusetts. New York was the top paying state for financial managers, followed by Delaware, New Jersey, California, and Massachusetts.

Salary levels also depend on the type of industry and the size of the organization. Large organizations usually pay a larger salary than small organizations. Many financial managers in the private and public industries also receive bonuses. This additional compensation will also depend on the size of the company. Senior-level executives many also receive deferred compensation in stock options. 

Related Occupations

There are a variety of jobs that are similar or related to financial managers. These career options would be advantageous for a person with financial management experience that cannot find a job as a financial manager. They could also give a candidate valuable experience to work toward a financial manager position. Some jobs include accountants, auditors, budget analysts, financial analysts, insurance underwriters, insurance sales agents, personal financial advisors, loan officers, and real estate brokers.

Accountants

Accountants and auditors work to make sure that companies work efficiently, keep accurate public records, and ensure that taxes are paid on time. They analyze financial information from different companies, clients, and government agencies. Budget analysts, on the other hand, work to help organizations allocation their finances. They work to develop, execute, and analyze budgets as well as forecast the future financial needs of private-sector businesses, nonprofit organizations, and agencies of the government. Financial analysts give guidance to businesses and individuals about investment decisions, such as stocks, commodities, bonds, and other types of investments.

Insurance Agents

Insurance agents help businesses, families, and individuals select insurance policies that will best suit their lives. This can include property, life, disability, health and long term care insurance. Insurance underwriters decide whether or not insurance is to be provided, and if it is, under what terms. They determine the risk of loss from policy holders, determine who will receive the policy, establish a premium, and create a policy that will cover the risk.

Loan Officers

Loan officers work with lending money to pay for a house, car, or college education. The loan officer finds potential clients and helps them to apply for loans and complete the necessary paperwork. They also will collect information from the borrower to determine the likelihood that they will pay back the loan. They can also provide advice to people that have a hard time qualifying for loans.

Advisors and Brokers

Personal financial advisors and real estate brokers are two other common positions related to a financial management career. Personal financial advisors examine the financial needs of the client and help them with taxes, insurance decisions, and investment opportunities. They help clients to plan for their goals at both the long term and short-term level. This can include education expenses, retirements, and other general investment options. Real estate brokers assist customers with the purchase or sale of a property, whether it be a home or for investment. They know about real estate and the market within their community. They also need to have thorough knowledge of local zoning ordinances and tax laws, and they should be able to assist the customer with obtaining funding to purchase the property.

Sources of Additional Information

In order to learn more about financial manager careers, there are a number of websites that can provide more information. To learn more about certification and how it can help to obtain a career in financial management, individuals could access the Financial Management Association International at www.fma.org.

The Association of Financial Professionals can help with information about treasury and financial management and can provide guidance about the Certified Treasury Professional program. They can be accessed online at www.afponline.org. The Certified in Management Accounting destination program can be accessed on the Institute of Management Accountants website, at www.imanet.org. Finally, the CFA Institute will provide online information about the Chartered Financial Analyst program at www.cfainstitute.org.

Related Jobs

People with the educational background, skills, and desire to become a Financial managers might be well suited to work in one of the following fields as well:

 

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