Question for business graduates in finance, your salary

[daveco]

I've returned to college at the ripe old age of 28 and have just completed the first year of a business degree.

So far, maths for business, economics, accounting, and statistics have been my strongest subjects, so my plan is to go with quantitative methods as my second year elective (linear models, matrix algebra, integration, calculus of several variables and optimisation) with the aim of securing employment in the financial sector upon qualification after completing my third and final year.

My question is this; at the moment I am employed in the printing industry (I'm doing both this and college, full time) and my salary is about €40k a year. When I graduate I will be on about €23k starting off-is there any field in finance where I could be guaranteed a salary close to what I am on now after graduating (hopefully with a 1st)?

[s2kjock]

Who are you getting your 23k salary on graduation from?

You certainly won't be getting 40k in accounting on graduation as you would then be a trainee in some form for 3-4 years. You won't even get that as soon as your training has finished.

[Lawrence5]

€40k is a bit low - current salaries include taking the piss by employer due to state of economy. We pay c€55k in Dublin for qualified and have grades to take you higher be c€70k when you start managing people. All in Dublin...

You are well placed for fund accounting over there. Think carefully whether you choose commerce or client accounting. I'm cima and stuck in commercial - aca/acca will give you more options...

[daveco]

Lawrence5 said:

€40k is a bit low - current salaries include taking the piss by employer due to state of economy. We pay c€55k in Dublin for qualified and have grades to take you higher be c€70k when you start managing people. All in Dublin...

You are well placed for fund accounting over there. Think carefully whether you choose commerce or client accounting. I'm cima and stuck in commercial - aca/acca will give you more options...

Thanks Lawrence.

So what do you think I should specialise in in my final year, to maximise my starting salary? Is a masters required if I get a 1st in my degree and maintain full employment throughout?

[matt3001]

Its not just about maximising your starting salary but following a career path that gives you the best future earnings potential as well...

[mrmr96]

"Tax" and "Corporate Finance" pay the most.

[daveco]

matt3001 said:

Its not just about maximising your starting salary but following a career path that gives you the best future earnings potential as well...

Can you expand on this please?

Looking for personal experiences as well if people have any stories to tell

[daveco]

mrmr96 said:

"Tax" and "Corporate Finance" pay the most.

Are you in either?

[nsi]

I am (well, have been). What do you need to know?

[sideways sid]

Your chosen subjects take you closer to quantitative modelling / catastrophe risk modelling / algorithmic trading than some of the previously suggested roles.

These tend to pay relatively little until you find your niche and can prove what your modelling is worth, when you can make shedloads of cash. The environment is more difficult now that banks do less ostentatious Prop Trading, and geniuses are appearing from far flung places, who have the same skill set as you and are multi-lingual too.

[daveco]

nsi said:

I am (well, have been). What do you need to know?

Your experiences/challenges in the job, how interesting it is/was would be of interest to me. Were the hours long? If you have left either sector to work in another area what were the reasons?

[daveco]

sideways sid said:

Your chosen subjects take you closer to quantitative modelling / catastrophe risk modelling / algorithmic trading than some of the previously suggested roles.

These tend to pay relatively little until you find your niche and can prove what your modelling is worth, when you can make shedloads of cash. The environment is more difficult now that banks do less ostentatious Prop Trading, and geniuses are appearing from far flung places, who have the same skill set as you and are multi-lingual too.

Thanks for the info Sid-when you say the pay is "relatively little" what exactly do you mean? If you were in my shoes what would you do?

[nsi]

daveco said:

nsi said:

I am (well, have been). What do you need to know?

Your experiences/challenges in the job, how interesting it is/was would be of interest to me. Were the hours long? If you have left either sector to work in another area what were the reasons?

My background

I worked in Corporate Finance for about 4 years for a UK top 10 accounting firm. Joined the company as a graduate from Uni having studied Maths BSc. Went into their graduate training program to gain the ACA qualification. First year was Audit and Accounts, then moved to CF for final two years of training, plus two years post qualified.


Training

Initial training salary is LOW, like about the same as working on tills in Sainsburys low. BUT as you've identified the crucial thing is the training. The firm not only pays for your courses, but also the exam fees, and gives you paid time off work to attend study/revision and exams. Generally pay rises are linked to exam passes, so a pretty significant rise every 6 months or so. By the time I qualified I was earning roughly double what I had been on as a trainee, as the most significat rise comes when you attain full qualification and come off your "training contract" onto a full staff contract. Reason being is at that point you're a fully qualified ACA and could leave for another firm, as many do (until then you're pretty locked in by the training, which you have to finish or else have to repay them a lot of the fees the shelled out for you). Anyway, hence the need to actually pay a decent salary to retain you once you're qualified. Qualification takes 3 years minimum. (I passed all my exams first time, meaning I was "exam qualified" in 2.5 years. BUT you can't get full ACA qualification without 3 years experience, so I had to wait for the last 6 months to tick out before gaining my ACA and staff contract.)


Good points

Corporate Finance is pretty interesting IMO, for lots of reasons:
1. Work is project based, so every job is different. (i.e. no monthly or annual recurring work like Audits etc)
2. Work is interesting (i.e. CF gets involved when something proper significant is happening, like a fund raising, or an acquisition or disposal)
3. People actually care about what you do. (i.e. audits are mandatory, so no one really cares, but with CF the stuff you do can help people do is life changing. For example helping someone to sell a business they founded!)
4. Work is varied (i.e. you can work on lots of types of transactions, and depending on the size you can also play different roles)
5. Team comaradarie is good (i.e. when working in a team you really do all pull together, especially when there's pressure)
6. Good oppertunities for networking (work is often won by referral, either from existing clients or from other advisors, like banks, vc's and lawyers - which also means there's plenty of socials! Definite "work hard play hard" ethic.)
7. Travel (you might get to work on projects across the country, e.g. if the target company you're looking at isn't local)


Bad points

There are bad points of course:
1. Pressure (since the stuff you're doing is so important, a f**k up can be very costly)
2. Potential to be sued (see above)
3. Long hours (when working to a deadline, you just have to be flexible. Working until past midnight will happen every now and again.)
4. Travel (you might not get much notice you're going away!)


Highlights

1. Helping a guy who I got to be friends with to sell his company which he'd built from scratch, and the proceeds made him a millionaire. He now spends his time driving racing cars.
2. Helping a company run by a guy who founded it when he was 20, and now turnover over hundreds of millions of pounds (and makes several million profit per month!) and getting involved in his financial projections!
3. Looking at a company for a bank who wanted re-assurance before providing funding; Proper investigation proved the business to contain all kinds of "shenanigans" which they were trying to hide - saved our client, the bank, several million pounds.


Lowlights

1. Providing assistance with an analysis of a family company where there had been a sibling rift, I was acting for one against the other; on one site visit I was physically threatened before being escorted off the premises. Just caught up in someone elses' fight.
2. Working 18 hour days for best part of two weeks after being parachuted into a tech company which was seriously struggling for money. Crazy crasy hours, crazy company. Despite our best efforts there wasn't really a business there, and it went pop in the end anyway.


What I'm doing now

I was invited to take a secondment into one of the other depts within the firm. After 3 months I realised I enjoyed that work too, and was actually natually very good at it, however the work is MUCH less sexy. Offered a promotion and payrise to take the job full time, so I couldn't really say no. Despite enjoying my new job and earning more there are things I miss about CF now; like the clients and the sheer scale of the work. And the variety of the people you get to meet, either as clients, targets or other advisors - there's a lot of characters in the business! When people asked what I did, I used to be able to say "I help people buy and sell companies" but now I do something else less interesting.

Overall I really enjoyed my time in that job and I think it's something I could go back into if I chose to, but I'm pretty happy doing what I'm doing for the time being. Sorry if I've gone off piste with regards answering your actual questions!

(No doubt my mate and colleague miln will be along shortly to take the piss... )

[matt3001]

daveco said:

matt3001 said:

Its not just about maximising your starting salary but following a career path that gives you the best future earnings potential as well...

Can you expand on this please?

Looking for personal experiences as well if people have any stories to tell

I work in Corp Fin for a Big4 in London; and what I am getting at is don't just look at the headline number when you first start.

For example, if a company is prepared to pay for you to do ICAS/ICAEW etc and offering a slighly lower base salary than another company who just wants you to do CIMA, then in the long term being chartered will command you a higher long term-salary.

Another example, Tax usually has a higher starting salary than Audit, but I know in my firm upon qualification that imbalance has now reversed. (Corp Fin/Advisory/Modelling positions are virtually always higher than Tax/Audit). Also in Audit, as most people leave, as long as you are prepared to stay around and do dull work the route to partner (where the real money is to be made) is easier to reach.

Finally, you may find a bank (with a decent rep) who offers you a nice back-office role (with training) on a competitive salary. Again, be careful as in 15 years time you may have only jumped a few grades and £20-£40k in salary. In a professional services firm, the starting pay would be less, but in 15 years you could be partner and on £600k-£1.5m?

Just food for thought.

[jonny70]

matt3001 said:

I
Finally, you may find a bank (with a decent rep) who offers you a nice back-office role (with training) on a competitive salary. Again, be careful as in 15 years time you may have only jumped a few grades and £20-£40k in salary. In a professional services firm, the starting pay would be less, but in 15 years you could be partner and on £600k-£1.5m?

Just food for thought.

How many accountants actually make anywhere near 500k? Probably only the top of the top.

[db10]

you will be looking around £28k when you start an ACA training contract with a big 4 firm, rising to £45k when qualified after 3 years

you might get a few K in bonuses over that period as well

[db10]

matt3001 said:

I work in Corp Fin for a Big4 in London; and what I am getting at is don't just look at the headline number when you first start.

For example, if a company is prepared to pay for you to do ICAS/ICAEW etc and offering a slighly lower base salary than another company who just wants you to do CIMA, then in the long term being chartered will command you a higher long term-salary.

Another example, Tax usually has a higher starting salary than Audit, but I know in my firm upon qualification that imbalance has now reversed. (Corp Fin/Advisory/Modelling positions are virtually always higher than Tax/Audit). Also in Audit, as most people leave, as long as you are prepared to stay around and do dull work the route to partner (where the real money is to be made) is easier to reach.

Finally, you may find a bank (with a decent rep) who offers you a nice back-office role (with training) on a competitive salary. Again, be careful as in 15 years time you may have only jumped a few grades and £20-£40k in salary. In a professional services firm, the starting pay would be less, but in 15 years you could be partner and on £600k-£1.5m?

Just food for thought.

not sure what firm you work for, but in the biggest of the big 4 the tax salaries are higher than any other line of service - and in actual fact this extends to all grades - the bonus structure is different, but the base salary in tax is higher.

[zcacogp]

matt3001 said:

Its not just about maximising your starting salary but following a career path that gives you the best future earnings potential as well...

.... and doing something you enjoy! This sort of thread mystifies me; why choose a career path based solely on money? Do something you enjoy .... very few people, when on their death bad, say "I wish I'd spent more time at the office".


Oli.

[db10]

jonny70 said:

How many accountants actually make anywhere near 500k? Probably only the top of the top.

the average PwC partner "salary" was £760k lasts year - there are 850 partners in the firm. The other big 4 will have similar average partner salaries (although their number of partners will be less).

So yes its the "top of the top" in the sense of a partner is the highest grade, but there are quite a lot of them. Also remember a number of CFO/CEO's of large companies/FTSE companies are accoutants who will be earning £500k plus (with share options etc)

If you are good enough/talented enough/lucky enough then you can make more than £500k as an accountant - as with much in life it depends how hard you want to work to get there and frankly how much you want it.

[jonny70]

db10 said:

the average PwC partner "salary" was £760k lasts year - there are 850 partners in the firm. The other big 4 will have similar average partner salaries (although their number of partners will be less).

So yes its the "top of the top" in the sense of a partner is the highest grade, but there are quite a lot of them. Also remember a number of CFO/CEO's of large companies/FTSE companies are accoutants who will be earning £500k plus (with share options etc)

If you are good enough/talented enough/lucky enough then you can make more than £500k as an accountant - as with much in life it depends how hard you want to work to get there and frankly how much you want it.

Thanks for the info.

So its only the top of the top that earn that just like I said.According to this article there are over 280,000 accountants in 2009 http://www.guardian.co.uk/commentisfree/2009/jun/1...