Choosing a Profession in the Finance Industry

The financial industry is easy enough to break into, but carving out a viable long-term career is tough. To succeed in this industry, one must have discipline, intelligence, and possess a thick-skinned psyche. There are many different positions in the financial services industry, and it often takes years for individuals to find and settle into a position that is a good fit for them.

Finance Career Character Traits

In general, if you are a persuasive and knowledgeable individual and don't mind working long hours, a job as a registered representative might be a good fit. If on the other hand, you love numbers, are good at math and Excel spreadsheets, and relish delving into the financials of a public company, then you might want to be an analyst. If you have both skill sets, a position as a financial advisor could suit you best.

Of course, it's important to understand most people who enter the financial services industry don't end their careers in the same position in which they begin. Most use the knowledge and experience they gain in their earlier jobs to find other positions that better suit their interests. Where you end up depends on your aptitude and your desire to explore different job options.

Education Requirements

Twenty years ago, it wasn't uncommon for individuals in the financial industry to come from varied backgrounds. These days, a four-year college degree is almost a must. Typically, a bachelor's degree in business administration is the best course. It opens the most doors and gives the potential job applicants more alternatives should they want to deviate from their initial career path later in life.

If your goal is to become a registered representative and sell securities, you do not need a masters in business administration (MBA). However, if you want to break into some of the more prestigious firms' training programs (such as Goldman Sachs), it will help if you earn your MBA. As an analyst, it is rapidly becoming a must. Keep in mind this is a highly competitive industry, and this additional degree will help set you apart from the crowd.

While there are instances in which a diploma from a big-name school will help, employers are becoming more focused on class rank and grade point average, as well as any practical experience you've had in the field.

With that in mind, if you want to become a money manager, financial planner or enter some other specialized field within the industry, an MBA is highly recommended. To be clear, you can still work in these fields without an MBA, but preference is usually given to candidates with some form of post-graduate study.

In the MBA program, consider studying finance and economics. Again, these will open the most doors for you later in your career.

(For related reading, see: Does a financial advisor need an MBA?)

Don't Discount Internships

Internships are available for those who want to obtain positions as analysts, bankers, registered reps or virtually any other position on Wall Street. During your undergraduate or graduate studies, try to land an internship in the field you want to work in. Prospective brokers and/or analysts should try to get a job as an assistant at a local firm. Employers look for this type of experience on your resume.

If you know you want to get into the industry, but don't exactly know the type of long-term job you want, consider taking any front-line financial sales or office position to learn as much as possible about the industry. Again, this experience will look great on your resume and will educate you on what you might like to do as you gain more experience.

Secure Valuable Work Experience

The first step in getting the appropriate work experience is to check with your college. Student services or a guidance counselor may be able to provide you with local job listings or set up interviews with potential employers. If this isn't an option, or if the positions available aren't feasible because of your school schedule, consider approaching firms close to home on your own.

Obviously, we all like to be paid for our time, but consider working for free during your internship—as long as you receive a letter of recommendation for your work from your supervisor. In the long run, this is the best compensation you can ask for and your first employer may even start you off in a higher position or at a higher salary because of your experience.

Professional Securities Licenses

Obtaining securities licenses is almost sure to advance your financial career. As a broker, you will need a Series 7 license and a Series 63 license.  This will allow you to sell stocks, bonds and other variable securities in both your home state and other states, assuming you and your firm become registered in those states. Additional licenses may be required as you move up the corporate ladder. For instance, if you obtain a managerial position, you may be asked to obtain your Series 24, or principal's license. Your firm will sponsor you for these licenses. However, be forewarned: These exams are difficult and require a great deal of reading and memorization.

Analysts may also be asked to take the above-mentioned examinations as well as a Series 16 supervisory analyst exam, which allows them to issue and distribute reports. Additional training may require the analyst to sit for the chartered financial analyst (CFA) exam.  This series of three rigorous exams will test your financial knowledge and enable you to obtain higher-level advisory positions with hedge funds or mutual funds as a portfolio manager.

For those who want to become options principals, for example, the Series 4 license will probably be required. For those who want to become equity traders, a Series 55 license is necessary. In short, whenever you branch off into a specialized field, an additional license will be needed, and your firm will sponsor you. You cannot take these exams without being an employee of an NASD-registered firm and, typically, you must first attain your Series 7 qualifications before sitting for any specialized licensure.

Finance Industry Training Programs

Many firms do not offer sophisticated training programs. When this is the case, the would-be broker or analyst typically starts as someone's assistant. This is an entry-level position that will allow you to move up the ladder, depending on your aptitude and level of ambition.

A large number of firms, particularly the larger bulge bracket companies, offer formal training programs lasting for about a year, during which your production and/or progress is tracked and measured regularly against your peers. Often, these programs are very stressful as they are typically considered your probationary period. The good news is if you make it through these training programs, your odds for success within the industry improve dramatically.

Moving Up the Ranks

In some jobs, seniority is a major factor in moving up the corporate ladder. Although seniority might help you in your Wall Street job, typically only the smartest, most aggressive employees advance. This means you must know your job and be diligent. You must also constantly measure yourself against your fellow employees to determine whether your skills measure up. This may mean staying late or putting in some extra work to make sure your projects are top-notch. 

Long-Term Career Objectives

Analysts seem to have the most career choices in the industry. They can become producing brokers and can even make the switch to becoming financial writers. Brokers can make those same switches, but it is much harder. This is because a broker is usually only involved in the sales process, and has little or no involvement in the research process. In addition, they often have very little opportunity to hone their writing skills, which is vital to becoming an analyst.

(For related reading, see: Becoming a Financial Writer.)

Many brokers eventually decide they want to specialize in options or become branch managers. In this case, their sales experience puts them on a better path to achieving that goal.

The Bottom Line

Breaking into the financial services industry isn't too difficult, but building a career and earning a reputation as a savvy player is tough. You should expect the process to be mentally trying and time-consuming. Succeeding and moving up the corporate ladder will depend on your desire to succeed and beat out the increasingly stiff competition.

(For related reading, see: Earn Big Bucks With a Specialized Financial Career.)

Article Sources
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  1. Goldman Sachs. "What Will You Make Possible With Your Graduate Degree/MBA?"

  2. FINRA. "Registration, Exams and CE."

  3. FINRA. "Series 63—Uniform Securities Agent State Law Exam."

  4. FINRA. "Series 7—General Securities Representative Exam."

  5. FINRA. "Series 24—General Securities Principal Exam."

  6. FINRA. "Series 16—Supervisory Analysts Exam."

  7. CFA Institute. "CFA Program."

  8. CFA Institute. "Exam Dates, Cost, and Registration Fees."

  9. FINRA. "Series 4—Registered Options Principal Exam."

  10. FINRA. "Series 55 Equity Trader Qualification Exam," Page 3.

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