Careers in Finance

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In exploring careers in finance, one quickly begins to realize that there are a variety of jobs, with several types of organizations, requiring varying levels of education and training. Unfortunately, the word finance reveals few details about what one actually does as work in a finance career. The Career Guide to Industries 200405, produced by the Bureau of Labor Statistics, organizes finance careers according to three broad categories: banking, insurance, and securities and commodities. Careers in the banking industry focus on providing loans, credit, and payment services to individual and large institutional customers. Insurance industry jobs focus on providing clients with protection against financial losses and hardships due to such things as fire. Finally, securities and commodities careers are typically what most people think of when considering a career in finance. These jobs focus on advising and assisting individual and institutional investors with purchasing and selling stocks, bonds, and commodities.


The majority of jobs in the banking industry are clerical and administrative support positions. Bank tellers make up the bulk of the clerical positions in banking institutions. Tellers work directly with customers, assisting them with basic banking services such as depositing funds and cashing checks. New accounts clerks, also called customer service representatives, assist customers with opening and closing bank accounts and with applying for loans or credit cards. As a result, bank tellers and new accounts clerks need to be knowledgeable about a wide range of banking services and be able educate customers about these services.

There are several other entry-level administrative positions in the banking industry. Bookkeeping, auditing, and accounting clerks are needed to help maintain and update financial records, process deposit slips and checks, and enter data. Credit or loan clerks are responsible for organizing the paperwork needed to complete the required records for approved loans or lines of credit. Banks also need secretaries, receptionists, and computer operators to assist with the many administrative support duties.

According to the Career Guide to Industries, 25 percent of the positions in the banking industry are comprised of executive, administrative, and managerial occupations. Examples of these occupations include loan officers, trust officers, and financial managers. Loan officers are responsible for determining whether or not a customer can pay back a loan and then approving or declining the customer's loan application. They also help to bring in new business by developing relationships with customers who will need bank loans in the future. Loan officers and counselors also tend to specialize in either commercial, consumer, or mortgage lending. Trust officers are responsible for managing the finances of customers or organizations that have been placed in trust with the bank. Very often they are called upon to be the executor of an individual's estate upon that person's death. Last, financial managers supervise operations at branch offices or departments to make sure customers receive quality service.

Education and training requirements for finance careers in banking vary according to the special skills required for success and the level of responsibility. Bank tellers and clerks typically need, at minimum, a high school education. Some basic skills and interests needed for success as a teller or clerk are math skills, interpersonal communication skills, and comfort in handling large amounts of money. Typically banks provide tellers and clerks with additional training on the organization's procedures and regulations. The American Institute of Banking, American Bankers Association, and the Institute of Financial Education all offer accredited courses for advanced training. Bank tellers and clerks take these educational courses to prepare for more responsibilities and to assist with career advancement. However, most banks have their own training programs.

Financial managers, loan officers, and trust officers usually have a college degree if not a more advanced professional or graduate degree. Most study business administration or earn a degree with a major in business administration. Any college degree plus a master of business administration or a law degree are excellent preparation for one of these financial management positions. Managers who also sell securities need to be licensed by the National Association of Securities Dealers.

Earnings in the banking industry reflect the amount of responsibility and education required of the position. As a result, the more responsibility and education a job requires, the higher the salary, as can be seen in the salary ranges of commercial loan officers, trust officers, and top executives. Other factors that influence salary are experience, length of time with the bank, and location and size of the bank.

Employment in the banking industry is expected to grow at 3 percent, which is much lower than the growth rate of the overall economy, which is expected to increase 15 percent between 1998 and 2008. The downsizing and cost cutting that occurred in this industry in the early to mid-1990s is expected to decline. Most of the growth in the banking industry is expected to occur in small regional credit unions and banks. As banks become more automated and ATMs are able to provide more services, fewer bank tellers and clerks will be needed. Areas of growth can be found in customer service representatives for staffing call centers and trust officers to administer the estates of an aging population.


The Career Guide to Industries states that more than 40 percent of the positions in the insurance industry are administrative support positions such as secretaries, bookkeepers, word processors, and clerks. These support positions often require skills and knowledge that are specific to the insurance industry. For example, because insurance policy clerks focus on processing insurance policy applications, changes to policies, and cancellations, they need to have a strong understanding of insurance policies. They often verify both the completeness of an application and the accuracy of the insurance company's records. Insurance claims examiners and investigators often investigate questionable claims or claims that exceed the amount the insurance company is willing to pay. Investigators and examiners spend most of their time checking claim applications for accuracy, obtaining information needed for decisions from experts, and consulting current policy about claims.

Executive, managerial, and administrative jobs make up about 30 percent of the positions in the insurance field. Three examples of job titles found at this level of employment in the insurance industry are risk manager, sales manager, and underwriter. Risk managers develop the policies the insurance company follows when making decisions regarding claims. These policies are developed by analyzing historical data about natural disasters, car accidents, and other situations that may result in physical or financial loss. Sales managers sell insurance products, assist clients with questions about policies, and supervise staff. They make up the majority of managers in local sales offices. Finally, underwriters review applications for insurance and the level of risk involved in agreeing to issue an insurance policy. Essentially, the underwriter determines whether to accept or reject the application and how much a client should pay in premiums.

A smaller percentage, about 15 percent, of salaried employees in the insurance industry is made up of sales-people, often called insurance brokers or insurance agents, who focus on selling insurance policies to businesses and individual customers. Insurance agents can sell insurance exclusively for one insurance company or insurance policies issued by several different insurance companies. Some of the typical types of insurance polices an agent or broker may sell include health, life, annuities, property, casualty, and disability. In addition to these services, some agents are now licensed to sell mutual funds, annuities, and securities.

An even smaller career field in the insurance industry is the area of actuary science. Although there may not be as many actuaries as there are salespeople in insurance, they are very important to the industry. Actuaries set rates paid by customers at a level where the premiums that are collected will generate enough money to cover the claims that are paid out. Yet the premiums cannot be too expensive or customers will switch to other insurance companies. Actuaries accomplish this by studying the probability of an insured loss and the premium rates of other insurance companies.

Education requirements for jobs in the insurance industry vary, depending on the position and its responsibilities. Many of the entry-level clerical positions in the insurance industry require only a high school diploma. Higher-level executive, managerial, and sales positions require more education, with employers usually preferring to hire college graduates. Most managerial positions are filled by promoting people from within the organization. Such employees usually have a college education, some special training in the insurance industry, and experience with the company. Actuaries typically have a college degree in actuary science, math, or statistics. After completing college, actuaries must pass a series of exams over a period of five to ten years to become fully qualified. Overall, advancement opportunities are good in the insurance industry.

Earnings for insurance clerks and clerical staff are below those of insurance examiners, adjusters, and investigators. Higher annual salaries are typical for higher-level general managers and top executives. Salaries for sales agents are difficult to pinpoint because many are paid a salary, plus commissions and plus bonuses for reaching sales goals. In addition, an agent's earnings will rapidly increase as he or she gains experience and develops a client base.

The employment rate for the insurance industry is projected to increase more slowly than the average for all industries combined. Job growth in the insurance field is expected to be limited by the downsizing of large insurance companies, computerization, and a trend that points toward direct-mail and telephone sales campaigns. One area of growth in this industry is that of financial services and products sales. Another growth area stems from the need to cover large liability awards resulting from lawsuits. Finally, the number of claims professionals will grow faster than any other position in the industry because of the need for better customer service and actual inspection of damaged property or consultation with doctors.


There are large numbers of workers in this area of the finance industry. The national brokerage companies have extensive systems of branch offices throughout the country; as a result, these brokerage firms employ the majority of the workers in this industry. Headquarters for these firms are located in New York City, where most of the executives and support personnel work. Mutual fund management companies and regional brokerages also employ many people. Although it is very well known, the New York Stock Exchange actually employs a small number of people compared to the rest of the industry.

A great deal of attention is focused on tracking performance, transactions, and the value of investments. Brokerage clerks are responsible for the majority of the daily operations and for processing much of the paperwork that is generated. These positions are often considered entry-level jobs with the potential for promotion into securities sales and even into higher positions. For example, a sales assistant takes calls from clients, writes up the order, processes the paperwork, and keeps clients updated on their portfolio's performance. With experience and a license to buy and sell securities, brokerage clerks can be promoted into higher-level sales positions.

The largest number of people employed in the securities and commodities industry can be found in three occupations: securities, commodities, and financial services sales. These careers involve buying and selling shares of stocks, mutual funds, and other financial services. The majority of these workers are sales representatives who work directly with individual investors. They are known as brokers, account executives, or financial consultants. Securities and commodities brokers differ in the investments they buy and sell. Securities brokers typically buy and sell stocks, bonds, and mutual funds. Commodities brokers buy and sell futures contracts for metals, energy supplies such as oil, and agricultural products. In addition to buying and selling securities, brokers can advise and educate their clients on investments, saving for retirement, and tolerance for risk. Overall, brokers spend a great deal of time marketing their services and products in order to establish a strong customer following.

Financial planners go a step further in advising and educating their clients. They often provide advice on investments, investing for retirement, tax planning, and employee benefits. Their strategy tends to be more of a comprehensive approach to advising clients on financial matters when compared to brokers. These planners can also buy and sell stock, mutual funds, bonds, and annuities.

Investment bankers and financial analysts make recommendations about potential profits from investments in specific companies by reviewing the companies' financial records and evaluating market trends. They also play a very important role in determining the market value for stocks that are traded publicly or stocks being purchased when a company is merging with or acquiring another company. Financial analysts often specialize in a specific industry sector, such as technology stocks.

Another career in the securities and commodities area of the finance industry is that of portfolio manager. These finance professionals are responsible for investing large amounts of money. The portfolios they manage are often mutual funds, pension funds, trust funds, and funds for individuals who are investing very large amounts of money. Most importantly, portfolio managers must have a clear understanding of a mutual fund's or a client's investment goals in order to ensure that the investment decisions they make meet the financial goals and guidelines set by the mutual fund or client.

As a whole, the workers in this area of the finance industry are well educated and highly trained. Even entry-level brokerage clerk positions often require a college degree. Also, to sell securities professionals are required to pass an examination testing their knowledge of investments. The National Association of Securities Dealers (NASD) conducts this testing and licenses professionals to sell a variety of investment products. Most brokers and sales assistants obtain the Series 7 license from the NASD by passing the General Securities Registered Representative Exam. In addition to passing the exam, these professionals are required to take classes on regulatory issues and new investment products in order to keep their licenses. Currently, there is no special licensing requirement to become a financial planner. However, many financial planners earn a certified financial planning (CFP) or chartered financial consultant (ChFC) designation. The CFP is issued through the CFP Board of Standards and the ChFC is offered by the American College. A series of exams on investments, taxes, insurance, retirement, and estate planning must be passed in order to receive one of these designates. In addition, the CFP must follow the rules and regulations set forth by the CFP Board of Standards.

Most of the workers in the entry-level analyst and managerial positions have a college degree and studied finance, general business administration, economics, accounting, or marketing. In order to advance, many take part in management trainee programs where they briefly work and learn about different departments. To advance further and gain access to higher salaries and more prestigious positions, many people obtain a master's degree in business administration.

For many brokers and commodities dealers, income is based on a salary and on commissions from the sale or purchase of stocks, bonds, or futures contracts. When the economy is strong these commissions and bonuses are much higher than they are when the economy is in a slump. Another factor in determining earnings in this area of finance is the amount of assets the manager is responsible for managing.

Yearly earnings for entry-level brokerage clerks are at the start of the scale. Further up the scale are financial analysts and sales agents. At the next level are the financial managers. The highest-paid professionals in the securities and commodities industry are general managers and top executives. Many firms also offer their employees profit sharing and stock options. In addition, most salaried employees receive health benefits, paid vacation, and sick leave.

Job growth in this industry is being fueled by several factors. First, more than ever, people are investing in securities as a way to save money and plan for retirement, resulting in a large influx of money into the stock market. Second, although online trading is reducing the need for direct contact with brokers, there is still a need for investment advice. Finally, the increased demands of investing in a complex global market have created a need for skilled investment managers. According to the Occupational Outlook Handbook, these factors have contributed to an employment growth projection of 40 percent for this segment of finance careers, which is much greater than the 15 percent projected for all other industries combined.

see also Finance


Career Guide to Industries, 200405 Edition (2004). U.S. Department of Labor, Bureau of Labor Statistics. Washington, DC: The Bureau.

Careers in Focus: Financial Services (2006). New York: Ferguson Publishing Company

Occupational Outlook Handbook, 200405 Edition (2004). U.S. Department of Labor, Bureau of Labor Statistics. Washington, DC: The Bureau.

Pandy, Anil, and Okusanya, Omotayo T. (2001). The Harvard Business School Guide to Careers In Finance 2001 Edition. Boston: Harvard Business School Press.

Mark D. Wilson

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Careers in Finance

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Careers in Finance