Money is the lifeblood of business, the thing that keeps the doors open, the wheels turning, and the paychecks coming. Managing that money is the job of finance professionals. They recommend and help implement strategies including investments, loans, mergers and acquisitions, and stock sales, all with an eye toward maximizing profit and reducing risk. This is equally true in the personal finance market, where financial professionals help groups and individuals formulate sensible plans to accrue wealth. Finance careers are available to those who hold only a bachelor’s degree, but the plum jobs go to those who have pursued advanced degrees, such as the master’s/ in finance.
A master’s degree in finance is typically a Master of Science degree, either in finance or in some more specific area of finance (e.g. financial economics, quantitative finance, financial mathematics, financial engineering). The degree is typically offered through the university’s school of business and management, although some some universities offer it through their engineering school.
Master’s in finance programs focus on finance and financial markets, with an emphasis on quantitative skills in statistics, probability, and computer science, and on quantitative applications such as risk management, asset management, derivatives, and financial forecasting. The degree designation indicates the program’s emphasis: a master’s in financial economics, for example, will stress economic theory, while a master’s of financial engineering will focus on the application of mathematical models to investment strategy.
A finance master’s is more singularly focused on finance than is an MBA/ with a finance concentration, and requires more advanced skills in mathematics and computing. Unlike an MBA, which typically takes two years to complete, a finance master’s can be completed in as little as 12 months. Some programs offer both a 12-month option and a less grueling 15- or 18-month option. It is not unusual for students interested in finance careers to pursue a master’s in finance upon completion of, or in conjunction with, an MBA.
A master’s in finance opens a wide range of career opportunities in investment banking, commercial banking, corporate finance, real estate finance, personal financial advising, real estate finance, money management, insurance analysis, and financial analysis. According to the Bureau of Labor Statistics, the finance sector should experience better-than-average job growth between 2016 and 2026.
Jobs in financial management, for example, are predicted to grow by 19 percent over the period; in personal financial advisement, by 15 percent; and in financial analysis, by 11 percent (by comparison, the overall job market is projected to grow at a rate slightly over 7 percent for the same period). Better still, the BLS lists these as among the highest-paying jobs in the business sector. In 2017 the median annual income for a financial manager was just over $125,000; for personal financial advisors, 2017 median annual income topped $90,000.
For many prospective graduate students, cost and convenience are the most important—perhaps the only important—factors in choosing a program. Those with the flexibility to consider other program features should think carefully about the following:
1. Reputation of degree: Simply put, top programs feed the top jobs. If your goal is to be a star in the finance world, you’ll want to look at one of the top-ranked programs (a number of which are listed below). If your ambitions are less lofty, a five-star degree probably isn’t necessary. There are many excellent graduate finance programs in the U.S., some at relatively affordable state institutions.
2. How theoretical/pragmatic is the program’s approach?: Some graduate programs—quite often the top-ranked schools, whose reputations are based at least in part on the cutting-edge research generated by their faculty—emphasize theory over process. Other programs focus more on the nuts-and-bolts of daily finance work. As always, evaluate the program’s focus in light of your career goals.
3. How general/specialized is the degree?: Not all master’s in finance degrees cover the same content. Some offer a panoramic view of finance, while others have a narrower scope. The degree designation (Master of Science in Finance, Master of Quantitative Finance, Master of Financial Engineering) will offer a clue in this regard, but a visit to each prospective school’s website is the best way to learn about each program. You won’t need to dig deep: schools know where their strengths lie and are not shy about promoting them. You’ll also want to factor in the school’s location: programs in Oklahoma and Texas will likely focus on finance in the energy sector (since that’s where many of the field’s experts live and work), while programs in New York City are more likely to stress investment banking.
4. What ‘bells and whistles’ does the program offer?: Yes, it sounds cheesy, but in many cases features like live simulations, internships, overseas study, labs and capstone projects are not only worthwhile on their own merits but also a good indicator of how seriously invested the school is in the program.
5. How big, and how influential, is the alumni network?: In the end, what you want is a great job, and a/ great alumni network can provide a huge boost to that end. Bigger programs may seem less exclusive and therefore less desirable, but they also have larger alumni networks. If your goal is to remain local after graduation, you should look closely at the nearby schools that feed your region’s job market.
The following finance programs are among the nation’s best, according to US News & World Report:
Massachusetts Institute of Technology, Master of Finance: Unsurprisingly, this quant and engineering powerhouse stresses “advanced financial theories, quantitative models, and industry practices." Graduates earned a median starting salary of $107,500 in 2017, the last year for which data is available. MIT offers 12- and 18-month tracks.
University of Chicago, MS in Financial Mathematics: Chicago’s 15-month program explores “the deep-rooted relationship that exists between theoretical and applied mathematics and the ever-evolving world of finance." With core courses in the mathematics of option pricing, stochastic calculus, regression analysis, and fixed income derivatives, this is definitely a program for quants.
New York University, MS in Quantitative Finance: Students are expected to arrive at NYU with a solid background in engineering, mathematics, science, and technology; the program is “targeted toward smart, disciplined and dependable students who have the ability to climb a steep learning curve and a well-developed capacity for creative and critical thinking." The campus is located less than two miles from Wall Street.
Columbia University, MS in Financial Economics (through the business school) and MS in Financial Engineering (through the engineering school): Further uptown, Columbia University offers two options. The two-year MS in Financial Economics combines courses offered through the business school’s PhD and MBA programs. This is a tiny program; the Class of ‘17 consisted of 16 graduates. The MS in Financial Engineering, which can be completed in as little as ten or as many as 18 months, is larger, with between 60 and 70 students per graduating class. The program “provides full-time training in the application of engineering methodologies and quantitative methods in finance."
Stanford University, MsX: Stanford offers a one-year generalized business master’s rather than a specific master’s in finance. It is included here because (1) the flexibility of the program allows students to load up on finance electives, effectively fashioning their own master’s in finance programs,; and (2) Stanford’s finance faculty is so highly regarded as to merit inclusion here.