Last Updated: April 24th, 2022 by
Public and private organizations alike need money to do what they do. They also need someone responsible for managing that money through budgeting, forecasting, and reporting. That’s where the finance manager comes into play.
In this role, you’ll help other departments ensure they’ve got the money to get the job done. Keep reading if you’d like to discover how to become a finance manager.
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Job Description
As a finance manager, your overall responsibility is to manage an organization’s money. That begins with preparing budgets that guide the organization’s spending, whether for expenditures or investments.
You’re also responsible for preparing financial forecasts that estimate how much money the company will profit and spend in the coming years.
Being a finance manager also means accounting for every dollar that comes in or goes out of the organization’s accounts. Then, you’ll summarize that information in financial reports and statements to share with other leaders in the organization.
Your budgeting, forecasting, and accounting provide critical information and resources to help other managers make better decisions for the organization.
Read our related article on How to Become a Product Manager. Discover what it takes to pursue this lucrative career.
What Does an Average Day for a Finance Manager Look Like?
Some people might find it hard to decide if learning how to become a finance manager is the correct choice. If that sounds like you, it’ll help you understand what a finance manager does daily.
So, here’s what you’ll do on an average day on the job as a finance manager:
Preparing and Updating Budgets
All organizations work with limited budgets, whether in the private or public sector. That’s why you, as the finance manager, will work closely with other departments to prepare a budget that benefits everyone.
Making Financial Forecasts
The organization’s leaders will want to know how much money will come in or go out in the future. Since no one can see into the future, you’ll have to prepare financial forecasts that estimate how much the organization will likely make in the coming months and years.
Preparing Financial Reports and Statements
Besides making forecasts about things that haven’t happened yet, you’ll also prepare reports and statements about profits and losses that have already happened.
As a finance manager, you’ll work alongside your team to gather the financial information and ensure it’s all accurate.
Directing and Monitoring Investments
Companies and organizations also invest their money to make it grow. For example, many organizations invest money into a retirement fund for their employees.
Your role as a finance manager is to ensure that the company puts its money into the safest and most profitable investments. You’ll also have to keep an eye on them to ensure they perform well.
Managing Credit and Collections
Many companies supply goods and services on credit instead of collecting cash upfront. As a result, you’ll spend some time each day overseeing that credit and ensuring that customers pay up when it’s due.
Process for Becoming a Finance Manager
The experience you’ll go through to become a finance manager is pretty straightforward. However, learning how to become a finance manager does involve formal education. So, going to college is expected for this role.
Here are the stages you’ll experience when pursuing this career path:
1. Start in High School
Your journey to become a finance manager can start as early as high school.
You can choose to take courses that will help you later in college and as a finance manager during this time.
For example, some helpful high school courses include:
- Math
- Entrepreneurship
- Economics
- Statistics
- Banking and Finance
Exposing yourself to these courses early in life will help you excel in college. By the time you’re working for your first employer, you’ll have much stronger knowledge than many of your peers.
2. Get a College Degree
After high school, you’ll go to college or a university to pursue a bachelor’s degree. You could pursue a degree in finance during your time there.
However, you can also pursue other closely related degrees like:
- Business
- Accounting
- Economics
These degrees tend to share overlaps in the subject areas and skills you’ll require when working as a finance manager.
3. Gain Finance Experience
Unfortunately, you can’t become a finance manager straight after college. After all, that’s a leadership position where you’ll affect the organization’s success and lead team members.
Before you get to that level, you’ll need to get at least 5 years of relevant work experience. In this case, that means working in business or finance roles like as an accountant, financial analyst, or securities sales agent.
As you work in these roles, you’ll progress up the ladder into positions of increasing responsibility. Typically, you’ll qualify for a finance management role after you’ve spent those years proving that you’re ready for the challenge.
4. Pursue a Certification
Throughout your work experience, you can also pursue one or more certifications to support your journey. Some employers will likely specify the certifications that they want you to have.
For example, you can get certified as a:
- Certified Government Financial Manager (CGFM)
- Certified Treasury Professional (CTP)
- Chartered Financial Analyst (CFA)
These certifications usually involve examinations and work experience requirements. That’s why most professionals start pursuing them at the beginning of their careers.
5. Get a Postgraduate Degree
Throughout your journey, you can also pursue a postgraduate degree. For example, many people in the finance industry typically pursue a Master’s in Business Administration (MBA) to increase their earning potential and chances of getting better jobs.
Are You Suited for a Finance Manager Career? Skills, Credentials, Tools and Technology
No matter the stage you’re at in learning how to become a finance manager, it’s never too early to develop the skills and proficiencies to help achieve long term success.
Here are some of the personality traits, skills, and proficiencies crucial for your work as a Finance Manager.
Personality and Skills
The US Bureau of Labor Statistics (BLS) points out that having a detail-oriented personality, Organizational and analytical skills are necessary for your work as a finance manager.
Firstly, being a finance manager means you’ll have to collect and process financial information from all the organization’s departments. So, your organizational skills are crucial to help you keep all of that information organized and easy to use.
Naturally, you’ll be working with a lot of numbers. So, having a detail-oriented personality ensures that you won’t miss tiny mistakes.
At the same time, your analytical skills will help you interpret those numbers to know how the company is performing financially.
Credentials and Proficiencies
Besides skill and personality traits, the Occupational Information Network (O*Net) also highlights that you’ll need proficiencies in subjects like economics, mathematics, and management.
For starters, having a strong grasp of mathematics is a core requirement for your daily tasks. That’s because a lot of it involves calculating numbers and ensuring that financial records are accurate.
However, you’ll also need to understand economics to understand the bigger picture of how your organization gets and spends the money that it needs.
Last but not least, understanding management is essential for 2 reasons. Firstly, it helps you manage your finance department and its resources. Secondly, it allows you to understand how your organization operates and how you can make financially-relevant improvements.
How Does a Finance Manager Find Work?
You can find work as a Finance Manager in both the private and public sectors. Any type of organization that handles incoming and outgoing money daily will require the skills and knowledge you picked up while learning how to become a finance manager.
To increase your chances of finding work, you should focus your job hunt on industries that hire finance managers the most.
According to the US Bureau of Labor Statistics (BLS), you can find the largest employers of Finance Managers in:
- The finance and insurance sector
- The professional, scientific, and technical services sector
- The company and enterprise management sector
- At various levels of the government (i.e., the public sector)
- And the manufacturing industry as well
Your chances of finding an open Finance Manager position in these sectors are higher than anywhere else.
So, start your job hunt by identifying organizations from those sectors in your local area.
Then, you can:
- Check their official website for current job openings
- Contact them directly via phone or email
- Submit your resume or CV to express your interest in current or future job openings
In the meantime, you can also join professional associations for people in the financial industry (like the ones at the end of this article) to start networking.
Aside from building your professional network, doing that can also help you in your job hunt.
What is the Average Salary of a Finance Manager?
Finance Managers earn an average of $134,180, according to numbers by the US Bureau of Labor Statistics (BLS). Those same statistics also show that:
- The top 90th percentile of Finance Managers earns more than $208,000 a year, and
- The bottom 10th percentile of Finance Managers earns $70,830 a year.
Knowing these figures will help you decide if learning how to become a finance manager is worthwhile for you.
Where Do Finance Managers Earn the Most?
Surveys by the BLS also give a clearer picture of where Finance Managers can earn the most. According to them, the 5 highest-paying states for Finance Managers and their average salaries are:
- New York: $215,640 a year
- New Jersey: $184,130 a year
- District of Columbia: $177,930 a year
- Delaware: $176,630 a year
- Colorado: $172,400 a year
How Can You Earn More as a Finance Manager?
You can take a few helpful approaches to increase your earning potential as a Finance Manager.
Some of those steps include:
- Get an MBA: Your academic qualifications matter in the financial management industry. That’s why many choose to advance by pursuing a Master’s Degree in Business Administration (MBA).
- Study your industry: Finance managers work directly for all kinds of businesses, not just the finance industry. So, you must take time to study the industry you serve, whether that be manufacturing, tech, or anything else. Combining industry knowledge with your financial ability will make you a more effective manager.
- Pursue training: Learning how to become a finance manager doesn’t stop after graduation. That’s because your employer’s industry and the financial industry both continually evolve. So, continuing your education with additional training from time to time will help you keep up and continue to make better financial decisions for your company.
- Network: There’s a famous saying that by the time something makes the news, it’s already too late. That’s why building a strong network in the industry is crucial for you to find out the risks and opportunities that affect your company financially before most other people.
As you can see, there are several different ways you can make yourself a more valuable Finance Manager to employers.
Some approaches involve academic and industry knowledge. However, networking will require you to develop the soft skills that help you communicate and build relationships with other professionals.
Read our related article on Bank of America Careers. Discover everything you need to know to start working with one of the best banks in America!
Finance Manager Job Outlook
The US Bureau of Labor Statistics (BLS) has data showing that the job outlook for this role is very positive. The BLS estimates that this role is growing at a ‘much faster than average’ rate of 17% until 2030.
So, investing your time and effort into learning how to become a finance manager can be pretty promising over the next decade. Based on the BLS data, you can expect plenty of employment opportunities once you enter the job market.
Still, not all of the finance manager job opportunities that you find will be the same. That’s why you can also get a head start on your future job hunt by understanding the kinds of finance manager roles that you can apply for later.
Once you understand your options, you can then prioritize the ones you feel are best for you and prepare for them long before you submit your first job application.
What are the Types of Finance Manager?
There are several different types of finance manager roles within a finance team. All of those roles overlap in terms of responsibility to some degree.
Typically, a finance team in a larger organization will have several managers focusing on different areas. However, smaller organizations will have fewer finance manager roles, each handling multiple responsibilities simultaneously.
Remember that there are no rules set in stone, so the organizational structure will be different from one employer to the next.
Here are 6 types of finance manager roles you’ll find in the industry:
Controllers
As a controller, you’ll be leading the company’s accounting, audit, and budget teams. Your focus is to oversee those departments’ preparation of financial reports for shareholders and any regulating government agencies.
Cash Managers
Here, your focus is on controlling the money that goes in and out of the company. Your priority is to make sure that the company has enough cash available to make short-term and long-term payments.
Risk Managers
All businesses face financial risks, and some have roles for you as Risk Managers. In this specialization, your focus is on predicting those financial risks and planning ahead to minimize the company’s losses.
Credit Managers
Many businesses supply goods and services on credit. As a credit manager, you’ll decide how much credit your clients get and ensure that those clients pay up on time.
Treasurers
Working as a treasurer means that you’ll specialize in raising money and creating a budget for how to spend it. Your role will ensure that the company has the financial resources to reach its short-term and long-term goals.
Insurance Managers
This area overlaps with the risk manager role. Both aim to reduce the company’s exposure to risk and financial loss. However, this specialization will have you managing the insurance protections that the company invests in to protect against specific risks.
Read More: Truist Careers. See what it takes to persue a Truist career in finance!
Professional Associations
Learning how to become a finance manager in college isn’t enough to guarantee long-term success. Instead, you’ll also have to connect with and learn from other people in the industry.
You can do that through professional associations like:
Association for Finance Professionals
Society for Financial Services Professionals
Financial Management Association International (FMA)
Top Colleges and Universities
Academically, you can learn how to become a finance manager by studying business, economics, or similar fields. Some of the leading colleges and universities for those fields are:
University of Michigan (Ann Arbor)
