Finance is a career field that I have studied for many years. Finance was my major in both undergraduate and graduate school. I was always fascinated by the financial markets and the earnings power of the financial sector. Finance majors were in demand when I first graduated and are still in demand today. Every sector of the economy (banks, tech, energy, healthcare, nonprofits, retail, sports) has a need for an individual who is skilled in the financial arena. Some finance jobs pay much better salaries than others and have greater earnings potential due to bonuses, stock options, compensation packages. Let’s take a look at five of the best paying jobs in finance today.
BEST PAYING JOBS IN FINANCE
#1 Hedge Fund Manager
Working as a hedge fund manager is one of the most lucrative careers in finance. Hedge fund managers are CEO’s of investment firms who work long hours and have stressful occupations. They are in the office in the early morning and work until late in the evening. Hedge fund managers play a high risk game with large amounts of capital. They are always trying to find an edge on the market. Don’t feel too bad for them though. Hedge managers are compensated tremendously well for their success. They are some of the wealthiest men and women in the world. Think Bobby Axelrod from the Showtime show Billions. The best hedge fund managers are billionaires with luxurious mansions, beautiful yachts, and private planes.
Hedge fund managers get paid to manage the investment portfolios of rich people and pension funds. Hedge funds are mutual funds for the wealthy. Hedge funds require large capital deposits often in the millions to join and are only available to accredited investors and institutional investors. Accredited investors are people who have a net worth over $1,000,000 excluding their home residence or individuals who make over $200,000 a year individually or $300,000 a year jointly.
Hedge fund manager Kenneth Griffin, the CEO of Citadel, LLC raked in $2.5 billion dollars in earnings just last year alone. Jim Simons, who started Renaissance Technologies has a net worth of over $24 billion dollars. All hedge fund managers aren’t billionaires however. The salaries of hedge fund managers run the whole gambit. The average hedge fund manager salary is $97,000 – $149,000 per year. The median salary goes far higher being $97,000 – $245,000 per year.
#2 Chief Financial Officer
The Chief financial Officer is the overseer of all the financial activities of a business. The CFO is responsible for all financial reporting, financial management, and financial planning of a company. Chief financial officers typically possess Master of Business Administration degrees and have years of experience. The Chief Financial Officer is responsible for ensuring the accuracy of the balance sheet, income statement, cash flow statement and all other reports.
This is the top financial position in a company and ranks just below the Chief Executive Officer.
While hedge fund managers have the highest earning potential, chief financial officers regularly come in at the six figure range. The average salary for a chief financial officer goes from $130.000 – $460,000 per year. Most CFO’s are rewarded handsomely for their mixture of education and experience with the median salary range coming in at $416,000 per year. The top end CFO’s earn as much as $700,000 per year. This does not include stock options, bonuses, and other incentives for hitting financial objectives.
Chief financial officers are responsible for protecting the assets of a firm and continually increasing revenue and profitability. They oversee the accountants, financial analysts, and banking operations of organizations. It is an important leadership position in a firm with far less stress than being a hedge fund manager.
#3 Chief Compliance Officer
Chief compliance officers typically hold graduate level degrees in finance, law, or some business related field. These jobs are for ensuring that the company complies with all laws and regulations both internally and externally. For example a chief compliance officer would ensure that a company is compliant with the state Comptroller’s officer or a state financial regulation board. Compliance officers deal a lot with regulatory boards on behalf of the company.
Chief Compliance offers are paid big bucks to manage risk. They have a very broad salary range that goes from $95,000 – $301,000. Salaries vary based on experience and educational level. The average salary for the position is $136,000. The median salary for a Chief Compliance Officer is $236,900.
#4 Private Equity Associate
Private equity associates are paid to locate and review new investment opportunities for private equity firms. Associates are involved with fundraising and financing dealmaking opportunities. They are responsible for the due diligence that a firm does before a big acquisition. They analyze a company’s financial position, market opportunity, and future prospects for management.
The average salary for a private equity associate is $103,000 per year. The base salary runs from $130,000 to $140,000 per year at larger firms. Bonuses can equate to much as 150% of compensation. This means a private equity associate can easily bring total compensation of $350,000 or more per year.
#5 Investment Banker
Investment bankers help companies raise funds by issuing stock which is known as going public or an initial public offering (IPO). They help companies sell bonds which provide capital for funding operations and expansion. Investment bankers are also involved in merger and acquisition deals.
Investment bankers are famous for earning high starting salaries directly out of school. An investment banker can start in the $70,000 range. The average starting salary for an investment banker at a large firm is over $100,000, whereas it averages $74,000 at a smaller firm. Compensation also comes in the form of bonuses, profit sharing, and commissions which can double this salary for investment bankers. The median investment banker salary averages $151,000 – $162,000.
Salaries rise as titles change from analyst to associate to executive director to vice president to managing directors. Investment bankers may start below six figures some places but quickly rise to making $400,000 or more after a few years at firms like Goldman Sachs and Morgan Stanley. Wall Street investment bankers make five times the average of other investment bankers with compensation totaling $438,000 a year. Managing directors earn an excess of $1 million dollars a year or more.