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An Overview
The study of Finance addresses the ways in which individuals and businesses allocate and use economic resources over time, taking into account the risks entailed in their projects. Students will be exposed to a wide range of concepts about how businesses raise capital, make investments and track costs. Finance is an integral part of all organizations and one that impacts all people within an organization.
Why minor in Finance?
Finance is a critical part of all organizations and is used by individuals, governments, businesses, schools and not-for-profits. Students minoring in Finance will be able to demonstrate to potential employers a more focused interest in this area, while at the same time earning a broader business degree.
Where do Finance Professionals work?
Careers paths related to finance include the following:
- Commercial & Retail Banking - Commercial banks are in the business of providing banking services to individuals, small businesses and large organizations. While the banking sector has been consolidating, it is worth noting that far more people have jobs in the commercial banking sector than any other part of the financial services industry. Jobs in banking can be exciting and offer excellent opportunities to learn about business, interact with people, and build up a clientele.
- Corporate Finance - A career in Corporate Finance means you would work for a company to help it find money to run the business, grow the business, make acquisitions, plan for its financial future and manage any cash on hand. You might work for a large multinational company or a smaller player with high growth prospects. Responsibility can come fast and your problem-solving skills will get put to work quickly in corporate finance jobs. The job of the financial officer is to create value for a company.
- Financial Planning - Financial Planners and Wealth Managers help individuals plan their financial futures. How are you going to cover your retirement needs? What do you have to do today to put your children through college? This work can be personally and financially rewarding and requires excellent interpersonal skills. A good financial planner understands investments, taxes, estate planning issues and knows how to listen. This work can be done within a company such as Ameriprise or by yourself, as a sole proprietorship. Most planners go solo or work within smaller practices. It's essential then that you have a certain amount of entrepreneurship given that you will be running your own business. The work pays well and is rewarding if you like to help people. Increasingly, it pays to obtain the Certified Financial Planner (CFP) designation. The job outlook for this profession is considered to be good and it is expected that career opportunities and salaries will grow substantially in the next decade.
- Hedge Funds - A Hedge Fund Manager runs all or part of a hedge fund, with the goal of maximizing return. The Hedge Fund Manager makes calls on a wide range of financial assets - from corporate bonds to stocks to currencies. This is one of the most "white knuckle" jobs in all of capitalism. The compensation for working in a hedge fund can be unusually high. It is not uncommon to see a person in their late 20s or early 30s pull down $5 million a year or more in one of the right positions at a large firm. But, of course, there are many others who make much less and many more who fail altogether. All who participate in this industry take on high risk. It comes down to skill, timing and a little luck. In our recent salary review of starting compensation for recent graduates of the largest MBA programs, the highest average starting pay was in hedge funds.
- Insurance - Did you know that some of the hottest jobs in finance aren't on Wall Street at all? These are jobs in insurance. Insurance is a trillion dollar business that employs more than 3 million people in the United States alone. As the population ages and wealth grows, the demand for insurance professionals will increase dramatically. This is great news for you if you're thinking of going into insurance. Jobs in insurance involve helping individuals and business manage risk to protect themselves from catastrophic losses and to anticipate potential problems. Work in this area is not only personally rewarding, but can be financially rewarding as well. Insurance is a stable yet dynamic industry that provides a wealth of advancement and career opportunities. From administrative support to management programs, from sales to information technology, from accounting to customer service ... anything you want to do in business, you can do in the insurance industry! You will help clients understand their insurance needs, explain their options to them and hopefully help them purchase appropriate insurance policies. You could work in a variety of areas in insurance including as an underwriter, a sales representative, an asset manager, a customer service rep or an actuary. A theme that is constantly emphasized by insurance professionals is that the industry is ultimately about helping people when they need it the most. The stereotype of a slick, sleazy, fast-talking insurance salesman is largely a thing of the past. Major areas of opportunity include auto insurance, life insurance, P&C (property & casualty) insurance, and health insurance. It's worth noting that private health insurance companies are central to all versions of health care legislation now being proposed in the US. If anything, the health insurance industry is likely to grow in size due to efforts to achieve universal coverage.
- Investment Banking – Investment Banks help companies and governments issue securities, help investors purchase securities, manage financial assets, trade securities and provide financial advice. The top investment banks including Goldman Sachs, JP Morgan and Morgan Stanley are said to be in the bulge bracket. Other investment banks are regionally oriented or situated in the middle market (e.g. Piper Jaffray). Others are small, specialized firms called boutiques which might be oriented toward an industry vertical, bond-trading, M&A advisory, technical analysis or program trading. Firms have lots of different areas and groups within them. In most firms, there is sales and trading which works with owners of securities, investment banking which works with issuers of securities (firms and governments) and capital markets which goes in between the other two.
- Money Management - Do you like to look behind the numbers? Do you like to analyze market trends? Do you get an adrenaline rush when a stock takes off? If so, then money management may be the career for you. Money Managers hold stocks and bonds for institutional clients and are on the buy side of Wall Street. Some money managers use the latest sophisticated quantitative techniques while others do very well using simple intuition. Each Investment Manager has a unique style. The key to being successful is to have discipline, be broad-minded and be willing to admit defeat if an investment goes against you. Many money managers buy and hold fixed income securities including mortgaged-backs, corporate bonds, municipal bonds, agency securities and asset-backed securities.
- Private Equity firms are an increasingly important part of the economy and offer some of the most sought after careers in finance. By private equity we are referring to the activity of purchasing all or part of the equity of companies away from a normal stock purchase in the public equity markets. We separately discuss the closely related career opportunity in venture capital - the activity of investing in small, early stage companies. Private Equity Firms control close to a trillion dollars of capital and get involved in leveraged buyout transactions, partial stake purchases in public companies and investments in private companies.
- Real Estate - As you read this, more than seven million people in the United States have jobs in Real Estate fields such as title Insurance, Construction, Mortgage Banking, Property Management, Real Estate Appraisals, Brokerage and Leasing, and Real Estate Development. In addition, many were engaged in corporate real estate and in real estate lending in commercial banks, savings and loans, and insurance companies where their jobs are included in counts of jobs in the real estate sector. Over a third of the world's wealth is tied up in real estate. Real Estate is collateral for mortgages and a large amount of financial assets. Of course, at present, the markets are weak in housing and real estate but this field is not going away. It is also worth recognizing how interesting jobs in Real Estate are. Real Estate professionals are tied to the development of our society in a very direct way and participate in decisions that will shape the way we live for centuries. Work in Real Estate is personally rewarding, ever-changing and challenging. Take some time and consider your potential in the field of real estate.
What are the course requirements for a minor in Finance?
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