MBA vs. Master of Finance: An Overview
Those looking to get into a career in finance often are encouraged to continue their studies by earning a Master of Business Administration (MBA). An MBA offers a broad curriculum in finance, markets, accounting, entrepreneurship, and management. But a more focused alternative that is becoming increasingly popular is a master's degree in finance—also known as Master of Finance, Master's in Finance, or simply MF.
Choosing which of these programs best suits a prospective student may be challenging, but both programs offer the potential for high-paying career opportunities. So what is the difference between the two? The MBA equips graduates with a broader skill set and knowledge base composed of multiple aspects of the business world. An MF program, on the other hand, is much more finance specific. The applicant's career goals will largely determine which type of program they choose.
- Graduates of both MBA and MF programs can expect a quality education that will further their careers in business and/or finance.
- An MBA focuses on business while MF programs concentrate on finance-related courses.
- Schools offer full- and part-time MBA programs while MF programs are almost exclusively full-time.
- MBA programs are becoming more crowded, while business schools are becoming more competitive.
- An MF is a good alternative for students seeking a finance-specific career while devoting only one year to earning their degree.
Earning an MBA can be an important step in climbing the corporate ladder. The coursework involves a broad spectrum of business-related topics including accounting, statistics, economics, communications, management, and entrepreneurship. MBA programs prepare students to work for financial institutions such as banks, government agencies and nonprofits, startups, and other established companies in other fields. Applicants are generally expected to have good undergraduate GPAs and receive an adequate score on the GMAT exam.
There are two routes one can take in earning an MBA: a full- or part-time program. Although both result in an MBA, there is a trade-off: A full-time student will not make much money for the 18 to 36 months that they are in school. These programs are the most popular with younger students who recently earned their undergraduate degrees and can afford full-time studies.
Part-time MBA programs typically come in two flavors:
- The Executive MBA (EMBA) caters to students who have been in the workforce for some time in executive or leadership roles. The average age for these students is 38. Although they can be very expensive, some employers may pick up the tab.
- The part-time MBA is geared to employees who work full time, but are not yet in leadership positions. These students take classes after work, in the evenings, or on weekends to enhance their careers.
Hiring projections for MBA graduates were 91% in 2021 compared to 48% for those who graduated with a Master in Finance.
Master of Finance
As more universities offer MBA programs, the field is becoming a bit more crowded, and people are seeking alternatives. The Master of Finance degree may be appropriate for students who want a specific focus on finance or closely related fields. These programs zero in on finance in a comprehensive manner, with courses in financial theory, mathematics, quantitative finance, investments, markets, financial reporting and analysis, and valuation.
MF programs do not require any previous work experience, so students tend to be younger than their MBA counterparts. They are becoming increasingly popular, partly because they are shorter in duration:
- The one-year program is fairly fast-paced and intense and is intended for those who can study full-time. Those who opt for this option can acquire the necessary skills needed to enter the workforce quickly but may have to miss out on certain opportunities like international study and internships.
- Completing a two-year MF is possible but there are few schools that offer it. The coursework is similar to the one-year program. But it does allow you to specialize in a certain area. This allows you to take on more intensive research and you may even be able to complete a placement.
- Some schools offer an online MF, which allows you to study while you're working. Or you may be able to complete your coursework on an entirely remote basis or your school may offer a remote/in-class hybrid program.
Graduates can expect to earn lower salaries than those who have MBAs since the latter usually have some relevant work experience already under their belts and acquire a broader range of skills. The MF trains its graduates to enter fields such as trading, investments, or risk management and they may find work as financial analysts, actuaries, or consultants.
Certifications, such as the CFA program or financial planning courses, can help boost your earning potential after you graduate from an MBA or MF program.
Both the MBA and MF are graduate degrees and each comes with its own merits, which we discussed above. But there are some other key differences between the two that prospective students should know before deciding on which one to pursue.
One of the main factors is the cost. Of course, the price tag depends on which school you go to, how you intend to study (online or in class), and whether you choose to study part-time or full-time. MBA programs can be either while most MF programs are almost exclusively full-time.
- If you choose a full-time MBA or an MF program, you'll have to give up a good chunk of change and your earning potential drops significantly, especially if you have to do placements, internships, or work-study programs.
- If you choose to study part-time for your MBA, you'll still be able to work, which means less out-of-pocket expenses and more income coming in while you upgrade your education and skills.
Length of Time
Another consideration is how long it may take you to graduate. If you study full-time for your MBA or MF, you can expect to graduate faster and enter the workforce sooner. Part-time MBA programs, though, don't give you that flexibility.
Is a Master of Finance the Same As an MBA?
The only similarity between a Master of Finance and an MBA is that they are both graduate degrees. An MF allows students to specialize in a particular area and coursework typically focuses on finance-related topics, such as financial theory, math, quantitative finance, and financial analysis among others. An MBA, on the other hand, involves business-related topics and allows students to graduate after studying full- or part-time.
What Is Better, a Master of Finance or MBA?
Whether an MF or MBA is better depends on your goals, financial situation, and experience. Individuals who already work in the business world and want to move up to leadership positions may be better suited for an MBA. People who want to focus on the financial industry may want to consider pursuing an MF. Keep in mind, though, that MF programs are normally full-time, which means your earning potential drops. You may be able to take courses toward an MBA on a part-time basis, which allows you to keep working while you study.
What Courses Does a Master of Finance Include?
MF coursework is comprehensive and typically focuses on courses related to finance. These disciplines include financial theory, math, quantitative finance, investing, markets, financial reporting/analysis, as well as valuation.
How Much Do Master of Finance Careers Earn?
The average annual salary that someone with an MF can expect to earn is $80,000, according to Graduate Management Admission Council.