How to change careers for a job in the financial industry
The financial industry is one of the most competitive areas to break into, and people typically start at the bottom and work their way up. But that doesn’t mean you can’t change careers and land a job in the financial industry. If you have years of experience in a different field, for example, some of that knowledge can be transferred. Or you may need to strengthen your CV. Here’s what you need to know for a career in the financial industry.
Key points to remember
- The financial sector is made up of companies that provide financial services to consumers, businesses and governments.
- While Wall Street makes up a large portion of the financial industry, there are also a lot of jobs on Main Street.
- Much of the financial sector’s income comes from mortgages and loans.
- Entry-level jobs in the financial industry include analysts, tax associates, auditors, and financial advisers.
What is the financial sector?
The financial sector is a segment of the economy that consists of businesses and institutions that provide financial services to consumers, businesses, and government entities. The sector includes, among others, banks, investment companies, insurance companies and real estate companies. A significant portion of the income generated by the financial sector comes from mortgages and loans.
The financial sector is more than Wall Street and the institutions that operate there. Here’s a look at some of the key places to work in finance, on Wall Street and Main Street.
- Retail and commercial bankingâBanks provide deposit accounts, mortgages, loans, credit cards and debit cards. They also take care of currency exchange and money transfers. Potential jobs include a bank teller, mortgage agent, branch manager, credit analyst, auditor, and software engineer.
- investment bankâInvestment banks help companies and governments raise capital and complete mergers and acquisitions (M&A). Many investment banking jobs follow a standard path, from analyst to partner, vice president, director and, ultimately, managing director.
- AssuranceâInsurance companies help individuals and businesses assess and manage risk. They also help investment bankers assess and guarantee the risks associated with capital funding. Insurance jobs include a sales representative, customer service representative, real estate adjuster, data analytics, insurer, and actuary.
- Financial advisers and brokerage firmsâR Brokerage firms help clients buy and sell securities, and some firms also provide financial advisory and fund management services. Careers include a customer service representative, software engineer, financial consultant, risk manager, portfolio manager and trading specialist.
- Hedge fundsâHedge funds provide investment and fund management services to high net worth individuals (HNWIs) and institutional investors. Typical hedge fund jobs include financial analyst, trader, quantitative analyst, portfolio manager, and regulatory compliance officer.
- Private equity and venture capitalâPrivate capital (PE) and venture capital (VC) firms provide money to start-ups and other businesses in exchange for equity or profit participation. Positions include associate, product manager, financial analyst, software engineer and business development.
- Other financial servicesâOther areas of the financial industry include careers in accounting, tax preparation, payment processing and software development.
Jobs in business and financial operations are expected to grow 8% from 2020 to 2030, about as fast as the average for all occupations.
How to break into the financial industry
If you’ve spent years (or decades) in another industry, it can be intimidating to take up a job in the financial industry. Nonetheless, a career change can offer a much needed change of scenery, more rewarding challenges, and better pay, among other benefits. Of course, the financial industry is very competitive so you may need to brush up on your resume and skills.
- Higher EducationâAn MBA or degree in finance will certainly help you land a job in the financial industry, but these aren’t the only graduate degrees that companies will take seriously. Financial companies may also consider applicants with degrees in computer / information technology, physics, engineering, mathematics, economics, accounting, international trade, corporate / business law, etc. And keep in mind that you can reinforce any training with additional lessons in a relevant area.
- Professional certifications– Obtaining a title (or two) can increase your credibility, open up better opportunities and help your resume stand out. Professional designations that can help you land a job in finance include Chartered Financial Planner (CFP), Chartered Accountant (CPA), Chartered Financial Analyst (CFA), Registered Agent (EA), Chartered Life Underwriter (CLU), approved financial consultant (ChFC) and approved damage insurer (CPCU).
- Financial reports, and beyondâMost jobs in the financial industry require you to know not only financial reports, but also economic policies, business trends, social trends, labor issues, and political events. The more you read, study, and immerse yourself in these topics, the better equipped you will be for a job in the financial industry. A good place to start is to read the financial media, such as Investopedia, Bloomberg, The Wall Street Journal, The Economist, The Financial Times, Forbes, and Fortune.
- Networking– Where possible, network with people who are already working in the financial industry to find out what it really is and get inside information about what employers are looking for in candidates. Try researching local networking events or connecting with someone you know in the financial industry to get a glimpse of the potential for a career change. You may even be able to find someone who has made a career change in the financial industry.
- General skillsâMany employers in the financial industry are looking for candidates with top-notch soft skills. Depending on the job, desired soft skills may include communication, decision making, leadership, problem solving, flexibility, team building, time management, persuasion, collaboration, conflict resolution and willingness to ask for feedback. You probably have some of these skills from a past or current career and they will transfer to a job in the financial industry.
Entry-level finance jobs
Unless you have a highly transferable (and desirable) skill set, you’ll likely need to focus on entry-level financial jobs first. The most popular entry level jobs in the financial industry include:
- Credit analystâCredit analysts analyze investments and borrower creditworthiness to determine potential risk to investors and lenders. They work for banks, credit rating agencies, investment firms and other financial institutions. Most credit analysts have four-year degrees, and many are also pursuing industry certifications to advance their careers.
- Tax advisorâTax associates find ways to minimize the tax liability of a person or business. Most tax associates have a four-year degree in accounting or finance. They often work for accounting firms, various types of businesses and as independent contractors.
- ListenerâAuditors ensure that a company’s financial statements comply with generally accepted accounting principles (GAAP). They can be employed by the company itself or work as external consultants. Most auditors have a four-year degree in accounting or finance.
- Personal financial advisorâPersonal financial advisers help individuals make decisions about investing, budgeting, and saving, and create strategies for short and long-term financial goals. They typically work in financial institutions, including banks, mutual fund companies, and insurance companies. Typically, a four-year degree is required for jobs in this field, although employers typically do not require a specific degree program.
Even if you don’t land your dream job right away, there are plenty of opportunities to move, find your niche, and grow. Plus, jobs in the financial industry pay much more than the median salary, even at the lowest level, so your paycheck may not be hit too hard.
The bottom line
Keep in mind that depending on your goals, you may need to go back to school or take online courses to earn a degree or professional designation, which takes time. Still, with evening classes and self-paced online programs, it’s possible to start working toward your next career now, before you quit your current job. People choose to change career paths all the time.
What are the highest paying jobs in finance?
According to the employment website Indeed.com, the highest paying financial jobs include an investment banker, an information technology auditor, a compliance analyst, a financial advisor, an insurance advisor, an analyst financial, senior accountant, hedge fund manager, financial software developer, private equity partner and, of course, executive positions.
What are the jobs in the financial sector?
Jobs in finance include positions in retail and commercial banking, investment banking, insurance, brokerage firms, hedge funds, private equity, venture capital and other financial services, such as accounting, tax preparation and software engineers.
Do i need an MBA to work in finance?
No, you don’t need an MBA to work in finance, but it helps you stay competitive. If you decide to pursue an MBA, choose a reputable program that will get you noticed.