In considering whether to pursue a professional degree or qualification, two key factors often influence the decision: bettering your career prospects and earning a greater income.
There is some consensus that, after a certain point in your life, the position and the job profile matter more than the salary. This is true to a certain extent, but salary remains an important consideration in any career field.
The Chartered Financial Analyst (CFA®) program is one of the most respected designations in the financial field. Salary plays an integral role in the decision to become a CFA®, so let’s look at the different aspects that affect the salary of a CFA® professional.
The salary of a CFA® is based on various factors, including experience, educational qualifications, position in the organization, type of employer, and geographic location. For example, CFA® charter-holders who work for multinational companies typically earn more than those who work for smaller firms.
Average CFA® Salary
CFAs with one to four years of industry experience can expect to earn a median annual salary of approximately $68,383, whereas those with five to nine years of experience will typically earn an average of $87,732 (source: www.payscale.com). Professionals with more than 20 years of experience are paid a median salary of approximately $155,100.
(Note that these are median salaries, meaning that there will be many people who earn either more or less that those figures.)
A great way to compare CFA® salaries is by job title. Financial analysts tend to have lower-paying CFA® positions, earning salaries between $43,218 and $78,374 (www.payscale.com). Chief Financial Officers typically have higher-paying positions, and earn between $67,786 and $217,242 (www.payscale.com). Investment analysts fall somewhere in the middle and can earn between $43,364 and $86,300 (payscale.com).
(Note also that many CFA® charter-holders are compensated with bonuses and incentive pay that may not be reflected in reported salaries.)
The salary will also vary depending on the type of company or private firm that employs the CFA®. Private firms tend to pay more than smaller companies.
- Financial Services – median salary of $83,812
- Insurance and Financial Services – median salary of $91,006
- Banking – median salary of $93,578
- Investment Services – median salary of $78,816
- Wealth Management – median salary of $77,526 (www.payscale.com)
CFA® Salaries by Region
Salaries also vary by city and state. Chartered Financial Analysts in New York and California can typically expect to earn more than their peers in Colorado and Pennsylvania. For example, the median CFA® salary in New York City is $99,814, as compared to $98,660 in San Francisco, $85,412 in Denver, and $86,375 in Philadelphia (www.payscale.com).
Though starting rates are significantly different around the country, the amount you make consistently increases with your years of experience, which may make the initial investment of time and money in the certification worth it over the long run.
The easiest way to determine how much your salary would increase and whether a CFA® charter would benefit your career is to ask peers and mentors for advice, and to research salary information for your target job. Understanding the requirements for achieving your desired job or level of seniority and then analyzing which characteristics and professional certifications can get you there faster are an essential element of planning a successful career path.