How to become a Financial Manager: A step-by-step guide
A financial manager career is the kind of job that every finance enthusiast should consider.
Job opportunities for financial managers are expected to grow by 16% from 2022 to 2032, according to the U.S. Bureau of Labor Statistics.
But what are the financial manager responsibilities?
A big challenge for every company is finding the best way to make more money and deciding where to make the most profitable investments.
Company leaders trust financial managers with this task to create reports and analyze finances before making decisions.
A financial manager's skills involve using analytical thinking and leadership to help keep businesses thriving.
If your goal is to become a financial manager, there are a few things you should consider.
You can start in this field with the right education, experience, and skills.
However, there are specific steps to becoming a financial manager, so learning more is key to plan your career path.
In this article, we will share a simple guide on how to become a financial manager.
You will also learn about the job description and requirements for financial managers.
What does a financial manager do?
A financial manager takes care of an organization's finances.
They make sure the organization has enough cash flow and liquidity by handling budgeting, accounting, and financial planning.
They may also create reports to show how well the organization is meeting its budget goals.
Financial managers work closely with senior management to analyze data and make decisions about profitability.
Since many financial managers are in leadership roles, they usually oversee a team responsible for financial reporting and budgeting.
And because they work with legal teams, financial managers need to understand tax laws and financial regulations at both the state and federal levels.
A financial manager:
- Creates financial reports for upper management.
- Finds ways to cut costs for the company.
- Spots opportunities for growth.
- Oversee the accounting and finance team.
Also, there are many financial manager roles available:
- Treasurer.
- Credit manager.
- Risk manager.
- Insurance manager.
Educational requirements to become a financial manager
Financial managers are not required to possess specific credentials, but many employers prefer candidates with recognized licenses or certifications in accounting, auditing, or financial management.
Most of these certifications require at least a bachelor's degree and often need significant work experience after graduation.
To get these certifications, you may need to pass a standardized exam, complete an ethics assessment, and pay membership fees.
Bachelor’s degree in finance, accounting, or related fields
You need at least a bachelor's degree to become a financial manager.
While an associate degree can help you start in entry-level finance jobs, a bachelor's degree is necessary for this role.
Degrees in finance, accounting, or economics provide relevant knowledge, but a business degree can also be helpful.
A business or finance degree includes courses that teach you how businesses operate and develop the analytical skills needed for a successful finance career.
Master’s degree: Is it necessary?
A bachelor's degree can help you get mid-level jobs or leadership roles in small companies. However, if you want to work in bigger organizations, you will probably need a master's degree.
Financial managers often oversee employees and work with senior management, so it's important to improve your leadership and communication skills. One way to do this is by earning a Master of Business Administration (M.B.A.) degree.
Many MBA programs help students develop leadership skills and learn how to communicate well with business professionals. Some universities even offer specialized M.B.A. programs in finance that focus on detailed financial modeling and analysis.
Developing the right skills for financial management
To become a financial manager, you need to develop certain skills.
Besides being good with numbers, financial managers should have the following skills to move up in their careers:
- Management.
- Leadership.
- Communication.
- Analytical skills.
- Quantitative skills.
- Planning and organization.
- Problem-solving.
- Ethics.
Analytical and communication skills
Financial managers look at financial information and data to figure out what’s important and how it might affect the organization’s future.
Analytical skills are required because they help managers evaluate information carefully and make good recommendations for decision-makers.
Good communication skills are also very important in this job.
Financial managers often explain complex topics and give financial advice.
Strong communication skills allow them to discuss complicated transactions in simple terms so that everyone understands the key points.
The skills of a financial manager are useful not just at work, but also for personal finance, like planning for early retirement or creating a retirement strategy.
Leadership and decision-making abilities
Financial managers usually work in teams and collaborate with top executives in their organizations.
Leadership skills help them make sure everyone understands a common goal and encourages them to succeed.
However, when reviewing documents, financial managers may face challenges and find problems that need to be solved.
Strong problem-solving and decision-making skills help them address these issues effectively.
If you feel nervous about this, don't worry; practice makes the master.
Gaining work experience: The importance of internships and entry-level positions
A bachelor's degree often comes with an internship.
A financial manager internship is a real-world experience that helps you learn hands-on and build your professional network.
Internships can also lead to management training programs at the same company after you graduate.
But that's just the beginning.
Starting small can be a great option. An entry-level job is one of the best things for aspiring financial managers.
You can begin your career as an accountant, auditor, or financial analyst, gaining valuable experience by working directly with clients.
Accountants keep company records and prepare financial statements, while auditors make sure transactions are recorded correctly.
Financial analysts help evaluate investments, manage assets, and determine asset prices.
This combination of experiences not only prepares you for a financial manager role but also helps you meet certification requirements and build important connections in the industry.
Certifications to boost your career as a financial manager
After you graduate and start your career, you may want to think about getting certifications. While they are not required, having a professional certification can help you stand out when applying for financial management jobs.
There are many certifications:
- Certified Public Accountant (CPA): To become a CPA, you must be licensed by your state's board of accountancy, which requires at least 150 higher education credits and passing the CPA exam.
- Chartered Financial Analyst (CFA): This certification is for investment professionals with a bachelor's degree and at least 4,000 hours of relevant experience. Candidates must pass three exams from the CFA Institute and renew their membership annually.
- Certified Government Financial Manager (CGFM): This certification is aimed at professionals in government agencies. It requires a bachelor's degree and at least two years of relevant experience, managed by the Association of Government Accountants.
- Certified Management Accountant (CMA): To earn this certification, you must pass a two-part exam from the Institute of Management Accountants, complete a bachelor's degree, and have at least two years of experience in financial management or a related field.
- Chartered Global Management Accountant (CGMA): To become a CGMA, you need to be a CPA or meet professional development requirements, pass specific AICPA exams, and have relevant management accounting experience.
Career progression: From junior roles to senior management
If you have a bachelor's degree and want to become a financial analyst, you'll likely start in a junior position.
While junior analysts can advance, moving up to higher positions often requires further education.
That’s why many junior analysts go back to school for a master's degree.
With a master's degree, you can start as a senior financial analyst or quickly move into that role.
As you gain more experience and skills, a senior financial analyst can take on a supervisory role.
There are also chances to move into senior management.
In a corporate setting, senior analysts can become treasury managers, overseeing teams in their departments.
And, who knows? Even become CFO.
Conclusions
Building a career as a financial manager depends on your habits and aspirations.
What can we recommend here at Bloom Financial? Be patient, study, and work hard.
The skills needed for a financial analyst will take time to develop, and the role you’re seeking will also take some time to achieve.
However, it's part of the career journey.
First, pursue a bachelor's degree, then complete an internship, followed by an MBA, certifications, and finally land the role you’ve always dreamed of.
If you truly want to pursue this career, congratulations!
You’re entering a field with great growth potential, so perhaps it’s the right path for you.
