What's the Average Salary of a Chief Financial Officer (CFO)?

The average yearly salary of a chief financial officer (CFO) can vary based on a number of factors, but the median compensation for a CFO in the U.S. as of May 2021 was $393,377 per year, according to Salary.com. CFOs within the bottom 25th percentile should expect to earn $299,442 per year, while those in the 75th percentile should expect to earn $499,992 per year.

By way of comparison, according to the Bureau of Labor Statistics, the median weekly earnings of full-time workers in the U.S. was $984 as of June 2021, which is $51,168 per year. Thus, the average CFO makes almost eight times more than the average worker, making the CFO a very lucrative career by comparison.

Salary, Benefits, and Perks of a CFO

The primary factors that impact the median salary of a CFO include geographic location, and the experience and personal qualifications of the person. Base salary and bonuses make up roughly 80% of the total compensation a CFO should receive within a given year. The other areas of compensation are bonuses and benefits, as well as perks.

When bonuses are included in salaries, the median total compensation for a CFO is $541,930 per year. Those within the bottom 25th percentile should expect to earn $375,642 per year, and those within the 75th percentile should expect to earn $792,957 per year. Additional CFO benefits include Social Security, 401(k), disability, healthcare, pension, and time off. The value of these benefits and perks for the average CFO is about 20% of total compensation.

Perks of the job can vary but can include the likes of a company car or driver, a hefty severance package—also known as a golden parachute, relocation expenses, use of a private jet or helicopter, and first-class flights. While healthcare is a typical perk, high-level executives such as CFOs have access to disability and life insurance. Workplace-related perks can include a dedicated parking space, large offices, and private bathrooms, among others.

When it comes to total pay, it not only varies by experience but also job location. In major metropolitan areas and “financial capitals of the world,” such as New York City, the pay will be higher. The table below lays out the base compensation and total compensation including annual bonuses for ten major metropolitan areas.

What It Takes to Become a CFO

Many CFOs have a decade or more of relevant work experience and often have a Master in Business Administration (MBA). In many cases, a CFO will also be a certified public accountant (CPA). Generally, CFOs have held previous positions such as controller or director of finance. Some may have worked in accounting departments.

Per Salary.com, roughly half of CFOs have a master's degree, while 45% have a bachelors' degree. Meanwhile, just 2% have a doctorate or associate's degree, and only 1% of CFOs have only a high school diploma. In terms of salary, there is not much differentiation between a CFO with bachelor's or master's degrees.

At the top of the proverbial food chain, in the corporate world, is the chief executive officer (CEO). The CFO generally reports directly to the CEO and the board of directors. The average CEO makes $771,165 per year, plus bonuses and benefits.

CFO Outlook

The CFO is generally responsible for all budgeting, financial goal setting, and related financial reporting—including financial statement construction and review. Arguably, there has always been a need for CFOs, however, the position really only came about in the 1960s. This comes as companies’ finances, accounting, and bookkeeping have become more complicated.

The Bureau of Labor Statistics estimates that the number of top executive jobs will grow by 4% from 2019 to 2029. The business of being a CFO will likely change a lot over the next decade, including navigating the rise of cybersecurity and the advancement of technology.

As well, the CFO position will see increased demand when it comes to regulatory compliance. This includes managing risks, whether it be taking risks or protecting against disruption.

Overall, CFOs will not only be managing finances and overseeing banking relationships, but they’ll also need to be able to manage big data—embracing artificial intelligence and data analytics.

Examples of a CFO Salary

CFO salaries depend on a number of variables, including geographic location, the size of the company, the candidate's degrees and experience, and the type of industry. Here are some examples from public companies:

Apple

Apple CFO Luca Maestri earns an annual salary of $1 million according to executive compensation tables in the company's public filings with the Securities and Exchange Commission. The majority of Maestri's compensation is in the form of stock incentives, which were worth over $21 million in 2020. His total compensation for 2020, including retirement benefits and other compensation, was worth $26,253,270.

Microsoft

Microsoft CFO Amy Hood earned a salary of $975,000 in 2020, according to the company's public filings. In addition, she earned $14,792,679 in stock incentives and $3,734,981 in non-equity compensation. Altogether, her total compensation in 2020 was worth $19,626,234.

The Bottom Line

The chief financial officer is an important executive in major companies. CFO salaries vary widely, according to their experience, industry, and the location of the company. In addition, many CFOs take the majority of their compensation in stock options, bonuses, or other variable compensation.