Finance Master's and PhDs: Degrees at a Glance
For students with strong quantitative backgrounds, a master's or PhD program in finance may be a great fit. In these programs, you can broaden your knowledge of finance with coursework in a variety of topics, work with experienced faculty members, and engage in original research. Some programs offer professional development workshops, preparing you for the highly competitive job market.
Earning a master's degree will give you the skills needed to advance as a financial analyst, financial manager, or personal financial advisor. The U.S. Bureau of Labor Statistics (BLS) predicted a 23% increase in employment of financial analysts from 2010-2020, which is faster than average. A PhD in Finance could qualify you to become a professor in a university. Though there is much competition for college-level teaching positions, the BLS predicted 17% employment growth in the field as enrollment in universities continues to increase.
| Master's | PhD | |
|---|---|---|
| Who Is This Degree For? | Individuals with financial or quantitative backgrounds who wish to advance their careers in finance or eventually earn a PhD | Aspiring professors or researchers |
| Common Career Paths (with approximate mean annual salary) | - Financial Analyst ($88,000)* - Financial Manager ($120,000)* - Securities, Commodities, and Financial Services Sales Agents ($99,000)* - Personal Financial Advisor ($91,000)* | - University Professor ($87,000 - based on salary for postsecondary teachers across all business fields)* |
| Time to Completion | Approximately 1-2 years of full-time study | Approximately 4-7 years full time |
| Common Graduation Requirements | - Core courses and electives in finance and economic subjects - Master's thesis | - Core courses and electives in finance and economic subjects - Seminars in recent financial research - Research papers - Written and oral examinations - Doctoral dissertation |
| Prerequisites | - Bachelor's degree with some quantitative courses, such as math, finance, and economics | - Bachelor's degree - Mathematical competence |
| Online Availability | Yes | Not currently available |
Source: *U.S. Bureau of Labor Statistics (May 2011 figures)
Master's in Finance
Earning a master's degree in finance opens the door to a variety of career opportunities in the field. Graduates go on to work as financial analysts, portfolio managers, and risk management professionals. In general, these positions pay well and are in demand; you can expect to face stiff competition in the job market. Though many positions don't require a master's degree, the BLS mentions that master's-level preparation can help you advance in the field.
As a student in a master's degree program, you work on research, analyze current trends, and study financial theory in relation to future trends. Some programs use a cohort system, allowing you to form relationships with other students and collaborate on projects throughout your time in the program.
Pros and Cons
Pros
- Master's degree programs in finance are often flexible - some universities offer intensive programs that take one year to complete
- Graduates go on to work in a variety of different professions
- There are a number of online options, some specifically designed for working professionals
- Electives allow students to tailor the program to their interests and professional goals
Cons
- Some master's programs require specific prerequisite coursework prior to admission
- Certain career paths in finance require an MBA for advancement rather than a finance degree
- Some jobs in finance require working long hours
Courses and Requirements
In a finance master's program, you complete a set of required courses and choose electives based on your interests and strengths. Depending on the program, you may also be required to conduct research and write a master's thesis. You collaborate with other students and faculty members on research projects as you acquire the skills needed to work in today's global marketplace.
Examples of master's-level courses include:
- Econometrics
- Financial engineering
- Macroeconomic analysis
- Banking policy
- Derivatives
- Financial modeling
- Corporate risk management
- Investment management and analysis
Online Degree Options
Many online options for earning a master's degree in finance are available. Online master's programs are ideal if you can't commit to a traditional school schedule due to work or family obligations. Students in online programs generally take the same types of courses that students in on-campus programs take, and they're eligible to pursue the same career paths in finance and banking. You won't have face-to-face time with faculty and other students, but many online programs use a cohort model, allowing you to build relationships and interact with other students even though you may not meet in person.
Getting Ahead with this Degree
Professional development opportunities are available at many schools. You may find professional development programs that teach important skills in networking and resume building. These skills may be an asset when you begin your job search. As you interact with other students, professionals, and faculty members, try to build lasting relationships. You may find out about job opportunities by keeping in touch with other finance practitioners.
Some programs offer the option to specialize in an area of finance, such as energy or equity analysis. Specialized skills could give you an edge in the competitive job market. Another way to stand out is by earning professional certification, such as the Chartered Financial Analyst (CFA) credential offered by the CFA Institute or the Certified Financial Planner (CFP) designation offered by the Certified Financial Planner Board of Standards. According to the BLS, earning certification may improve your career prospects.
PhD in Finance
PhD programs in finance allow you to focus on original research in an area of your choice. These programs can prepare you for research or teaching careers in an academic environment. You may benefit from both the freedom given in your research endeavors, as well as the guidance that experienced faculty can provide. A solid background in a quantitative discipline, such as mathematics, statistics, or economics, is ideal for a student entering a PhD program in finance.
Pros and Cons
Pros
- Business professors earn above-average wages ($87,000 mean annual salary as of May 2011)*
- Close collaboration with faculty provides valuable experience toward entering a career in an academic institution
- According to the BLS, employment of university professors was expected to grow 17% from 2010-2020, with the most rapid growth being in for-profit institutions*
Cons
- Competition for coveted tenure-track positions at academic institutions is high
- Because employment opportunities in public universities often rely heavily on state and local government budgets, they may suffer as a result of budget deficits
- Students lacking specific academic experience in economics and mathematics may be expected to complete sufficient coursework before beginning PhD programs
Source: *U.S. Bureau of Labor Statistics
Courses and Requirements
PhD programs typically include a sequence of courses, research papers, and examinations. The first and second years usually consist of coursework in subjects such as econometrics, statistics, probability, and empirical finance research. After admission to PhD candidacy via oral and written exams, you work on a doctoral dissertation. In order to earn a PhD, you must defend your research findings before a group of faculty members.
Online Degree Options
Online degree options for students interested in completing PhD programs in finance are not available at this time. Since PhD degree holders generally move on to careers in teaching and research at academic institutions, it's important to develop skills in debate, presentation, and collaboration. These skills must be practiced in person. Even while you're completing independent activities related to your dissertation research, it's important to have university resources and faculty guidance available to you in a traditional university setting.
Stand Out with this Degree
Since PhD programs are for students seeking careers in academia, it's important to become involved with the finance department while you complete your program. Some departments offer regularly scheduled seminars on current topics in finance presented by faculty and guests from other institutions. These seminars can be good networking opportunities. It's important to interact with faculty and other students; verbal presentation and debate are a major part of daily life as a university professor. Developing these essential skills can help you move into an academic career.
