Finance Major Career Brief

Overview

People who work in finance affect almost every aspect of business—indeed, of life itself—because money still does make the world go round. Consider the impact these financial practitioners have made: Corporate finance officers help their companies raise capital that often finances new plants and new products, resulting in new jobs. Public finance professionals raise money to build roads, bridges, schools, and hospitals. Lending officers at banks, savings and loans, and credit unions help their customers finance homes or college education. Portfolio managers invest the retirement funds of millions of people.

Finance is a discipline that deals with allocation of resources on corporate, institutional, and personal levels. Although finance has traditionally consisted of three separate fields—corporate financial management, investments, and financial institutions—this distinction has begun to blur with deregulation and globalization. Additionally, many other fields with in finance, such as real estate and insurance, have an important impact within a financial education and also within a students career choices.

A student may focus in the areas of corporate finance, corporate governance, investment banking, and analysis of financial markets. UA students examine:

• How corporations deal with financial problems
• How firms plan for changes such as expansion or diversification
• Methods of managing funds
• Investment management stocks, bonds, and commodity markets
• Banks and other financial institutions
• Effects of government and economic conditions
• The circulation of money
• Credit and investment fundamentals

For more information, view Department of Finance website.

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Degree Requirements

Includes foundation courses required for Professional Admission, general education requirements, professional core courses, free electives, and a set of specific Finance Courses

Sample list of Finance Courses:

• Investments and Investment Research
• Advanced Corporate Finance
• Financial Intermediaries
• International Finance Risk Management and Derivatives
• Real Estate Finance and Investments
• Portfolio Management

*Students must achieve Professional Admission (a competitive and selective application process) to move from the pre-professional phase to the professional phase.

**Check the Degree/Academic Progress Report (APRR's) for your specific academic program requirements per your catalog at http://catalog.arizona.edu.

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Other Preparation

Internships & Work Experience
The Finance Department sponsors an internship program through which students get practical experience, supplemented with academic work. Finance majors should contact the department for further information. Students must earn passing grades in ACCT 400C, FIN 311, FIN 312 FIN 412, & FIN 421 before applying for an internship for finance elective credit. Volunteering, summer internships, and part-time jobs at financial institutions are encouraged in order to gain valuable work experience and develop skills.

Clubs & Organizations
The college has a wide variety of professional fraternities, honoraries and student clubs. Student organizations offer: Career information; networking opportunities; social and professional activities; and provide leadership roles and skills building opportunities.

Student organizations for Finance majors include The Financial Management Association. FMA is a professional and academic association whose student members interface with professionals from dynamic financial institutions as well as with representatives from major investment firms.

Visit the FESO - Federation of Eller Student Organizations website for more information.

Master's of Science in Management
Starting Fall 2001 the Eller College Finance Department is offering a Master's of Science in Management with a concentration in Finance (MMF). This degree can be pursued after completion of a degree without any requisite work experience in the interim. For more information please contact the Finance Department in McClelland Hall 315R.

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Career Opportunities

Employment of financial managers is expected to increase faster than the average for all occupations through 2005. The need for skilled financial managers will increase due to the demands of global trade, the proliferation of complex financial instruments, changing federal and state laws and regulations, and the entry of baby boomers into middle age with a bewildering array of investment choices.

Commercial banking employs far more people than any other part of the financial services industry. However, employment in securities and commodities is projected to rise 40% from 1998 to 2008.

Other finance related career areas such as, insurance and real estate, are also increasing in popularity and size. These “non-traditional” areas of finance often provide great stability and growth.

With changing regulations and technology, mergers and global markets, large financial services firms will be pioneering new ways to deliver financial services. If you want to work in a particular area, make sure that you are applying to the right part of the organization. Once you have zeroed in on a career, certification and/or graduate degrees in that area might be necessary for advancement.

Types of jobs and duties include:

Financial Planner
Typically, financial planners are people with a wide amount of experience in the field. They advise clients on financial matters ranging from personal budgeting to investment strategies. They often give recommendations on tax planning, estate design, wills, stock portfolios, life insurance and real estate holdings. Financial planners earn income by charging a fee to clients and earning a commission from products.

A common career path involves working for financial institutions (banks, insurance, securities brokerages) at the entry level, and receiving training in both sales and financial products.

A high percentage of financial planners are in the 30 to 50 age group and are independent practitioners or partners in a small firm. The designation of CFP, Certified Financial Planner enhances the professional recognition and lends credibility to the planner. Additionally certain licenses (for example, series 7) must be acquired when trading in securities or commodities.

The job requires initiative, ability to market clients, strong interpersonal skills, analytical ability, effective communications and persistence.

Analyst
A security analyst is a researcher involved with portfolio management and the analysis of bonds, stocks and other forms of investment. The largest employers of security analysts are the large brokerage houses, often located in New York. A security analyst is often assigned one type of industry to research and prepare reports. The entry level analyst is generally an assistant who prepares financial reports for internal use or for clients' needs, and are not for the general public's knowledge. Most security and investment analysts do not aspire to upward advancement in the typical manner of other professionals. They prefer to remain in their profession doing analytical work, but some do leave to move into bank lending and security sales positions or to manage departments of analysts.

Other titles for security analysts are portfolio manager, director of research, trust administrator, account manager and broker. Typical promotions are from junior analyst to senior to consultant. Sources of employment include investment counseling firms, mutual funds organizations, insurance companies, banks, brokerage houses and research firms.

Security Sales and Trading
A security salesperson is one who buys or sells stocks, bonds, or shares of mutual funds for an investor. They are often called customer brokers, registered representative or account executives. Before they can qualify as a registered representative, they must pass the Security and Exchange Commission's general security examination. Courses in finance and investment subjects are usually helpful in securing employment. Once a salesperson has completed training and licensing requirements, earnings are usually in the form of commissions from sales of securities.

Successful security sales people enjoy their work and earn substantial commissions. They can move into management positions, such as branch manager, but most prefer to remain in sales. The reason for the lack of interest in advancing into management positions relates to the higher earnings potential in sales and the sheer excitement of the business. Most work with high net worth individuals.

Brokerage houses regularly close or merge. Experienced security salespeople find themselves changing employers occasionally but there is little negative impact on their earnings.

Insurance
The insurance business is a major part of the financial planning program so the industry needs a variety of experts in this area. Three types of employment in the industry are underwriters, claims, and sales.

Underwriters appraise and select risks their company will insure. They analyze information in insurance applications, reports from loss control consultants, medical reports, and actuarial studies which describe the probability of insured loss. Underwriters assume great responsibility because their company may lose business to competition if they appraise risk too conservatively, and their company will have to pay too many future claims if their decisions are too liberal. Underwriters outline the terms of the contracts, including premium amounts. Most underwriters specialize in one of the four major categories of insurance: Life, Property Damage, Personal Liability, Health.

Claims representatives investigate claims, negotiate settlements with policyholders, and authorize payments.

Insurance agents sell policies that protect individuals and businesses against future losses and financial pressures. They may be either an employee of an insurance company or an independent agent who represents several companies. Beginning agents are usually paid a salary. After that time they are paid strictly on commissions.

Real Estate
There are more than five million people in the United States employed in identifiable real estate fields such as title insurance, construction, mortgage banking, property management, real estate appraisals, brokerage and leasing, and real estate development. In addition, many were engaged in corporate real estate and in real estate lending in commercial banks, savings and loans, and insurance companies where their jobs are not included in the real estate sector. Over a third of the world's wealth is tied up in real estate. Real estate is collateral for mortgages and a large amount of financial assets. As important as the field of real estate might be, it is also worth recognizing how interesting the work in this field is. Real estate professionals are tied to the development of our society in a very direct way and participate in decisions that will shape the way we live for centuries. Work in real estate is personally rewarding, ever-changing and challenging. Take some time and consider your potential in the field of real estate.

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Certification and Licenses

Financial managers may broaden their skills and exhibit competency in certain fields by attaining professional certification, such as:

• Chartered Financial Analyst (Association for Investment Management and Research)
• Credit Business Associate, Credit Business Fellow, Certified Credit Executive (National Association of Credit Management)
• Certified Cash Manager (Treasury Management Association)
• Certified Financial Planner (CFP)
• Certified Financial Manager (CFM)
• Chartered Financial Consultant

The Series 7 is the NASD/NYSE exam required by most broker-dealers for their registered representatives.

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Salaries

Starting salaries vary by size and type of employer, location, course work, and experience. National average starting salary offers:

• UA graduate high offer: $49,000 (UA Career Services 2004). UA Graduate average offer: $34,723 (UA Career Services 2004).
• National Salary Data:
  • Commercial Banking (Lending): $35,285 Financial Analysis: $42,476 Insurance Claims: $33,075 Investment Banking (Corporate Finance): $42,923
  • Investment Banking (Sales & Trading): $43,720
    (NACE Salary Survey/Fall 2003)

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Recruitment Opportunities

Finance graduates obtain jobs through various avenues, leading to placements with a wide range of firms and organizations. Recruitment opportunities include the annual "Career Week" sponsored each fall by UA Career Services and the spring "Career Showcase" coordinated by Eller BPA Student Council and Delta Sigma Pi.

A sample of employers that recruited Eller College Finance majors for both placement and career-related experience in the 2000-2001 school year through the Career Services office:

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For More Information

• UA offices
  Undergraduate Programs Office
  Eller College of Management
  McClelland Hall 204
  P. O. Box 210108
  Tucson, AZ 85721-0108
  520-621-2505
  http://ugrad.eller.arizona.edu/

• UA Career Services
  Student Union, Suite 411
  520-621-2588
  www.career.arizona.edu

• Department of Finance
  Eller College of Management
  McClelland Hall 315R
  520-621-7554
  http://finance.eller.arizona.edu

• Major and Career Advisor:
  Sara Hastings
  shastings@eller.arizona.edu

Professional Associations

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